* From Reboot Illinois…
Back in 1981, Illinois reported $164 million in debt service “interest” expense. By 2012, Illinois’ accumulating debt led to a reported $1.6 billion in interest expense — about 900% higher than in 1981, despite a 95% decline in general interest rates! To boot, Illinois has had a longstanding ‘balanced budget’ requirement in the state constitution, which theoretically constrained state borrowing.
In 1981, Illinois reported $8.4 billion in total liabilities. By 2012, that amount had risen to over $100 billion. And that is just the amount reported by the state under current government accounting standards. These standards have long allowed states to accumulate massive off-balance sheet liabilities for retirement programs for government employees. Truth in Accounting estimates these obligations totaled over $120 billion in Illinois as of fiscal year-end 2011 – an amount about equal to the state’s total reported liabilities.
$164 million in interest expenses in 1981 would be equal to $421 million in today’s dollars, and $8.4 billion in total liabilities in 1981 is equal to $22 billion in 2013 money, so the percentage increases aren’t quite as dramatic as claimed.
Still, that’s a whole lot of debt.