The Edmond Sun

Opinion

April 8, 2013

How to visualize $2 billion of state debt

GUTHRIE — You may have seen recent news reports detailing how Britain’s national debt now equals 90 percent of its entire economy. The Daily Mail published a graph showing the acceleration of the UK’s debt since 1992. I noted that although on a larger scale, the UK debt accelerated at a significantly slower rate than Oklahoma’s state debt during this same time period. For you see, in Oklahoma, long-term state obligations now exceed $2 billion.

Twenty years ago, total long-term state obligations were a tenth of this amount. I have published on my website at hd31.org/435 the graph showing the acceleration of Oklahoma’s debt since 1992. This massive difference between 1992 and 2012 becomes extremely apparent when we look at the bar chart showing the increase.

The viewer will note the 2012 debt towering over the 1992 debt much like the new Devon skyscraper dominates the Oklahoma City skyline.

The amount is so substantial that it would take each and every Oklahoman paying about $600 to pay it off. A family of four would have to come up with $2,400 just to pay their “share.”

To put it into a little different perspective, the state debt equals about 90 years of expenditure from either the Deer Creek School District general fund budget or the City of Guthrie city budget. This amount would pay for nearly 200 years of Logan County’s operating budget.

Those who continue advocating for debt increases seem to think that Oklahoma should jump off the fiscal cliff because, compared to the federal government and many other states, we are in a much better financial position. Of course, most who take a second to think through this dangerously flawed logic will quickly recall the important adage, “If all of your friends jumped off a cliff, would you do the same?”

A day of financial reckoning is rapidly approaching for our nation, and the debt-encumbered national, state and local governments are sure to face dire consequences when that occurs.

Perhaps even scarier is the fact that these numbers only represent the state’s tax-backed, long-term obligations.

The amount actually owed by the state is really much, much more. The state owes $9 billion in revenue-backed debt. Revenue-backed debt is issued by state government entities such as the Oklahoma Turnpike Authority, higher education entities, the state’s workers’ compensation insurance provider or the state-owned electric utility providers, OMPA and GRDA.

Advocates of new debt sometimes claim that revenue-backed debt isn’t problematic since it will be paid off by fees for service. But every time Oklahomans pay an unnecessary toll on a turnpike or are forced by bad higher education policy to live in a higher education financed dormitory, they are paying the penalty for this debt. Like the tax-backed debt, issuance of revenue-based debt also has dramatically spiraled out of control during the past 20 years.

None of this speaks to the additional $11 billion of unfunded pension system liability owed by the state, or the$750 million owed by the state’s business-type activities funds.

Fortunately, there is a light at the end of this very dark tunnel. A few weeks ago, in one of the most important votes of this legislative session, the state House of Representatives voted to pass House Speaker TW Shannon’s proposal to cap the level of state debt at current levels. This would substantially slow the practice by which the Legislature has incurred so much future indebtedness that will be placed on the backs of our children and grandchildren.

Not content to just say “no” to fiscal irresponsibility, Shannon also proposed and secured House passage of legislation that would allow the state to meets its legitimate capital infrastructure needs through a common sense pay-as-you-go approach that does not require debt issuance.

Shannon has proven that he is one of those rare elected officials who can oppose bad policy while creating positive solutions to real needs. Final passage of these two bills is a vital goal of reform-minded legislators during the remainder of this year’s session.

With the passage of these bills, Oklahoma can start to turn the tide and show that it is possible to roll back the fiscal insanity that has gripped our nation the past few years. Now, perhaps policy makers in other states won’t have to give in to the peer pressure to jump off the fiscal cliff as they look to the new Oklahoma example.

REP. JASON MURPHEY, R-Guthrie, represents House District 31, which encompasses all of Logan County and a portion of northern Edmond. He may be reached via email at jason.murphey@okhouse.gov, on Facebook at facebook.com/JasonMurphey and Twitter.com/JWMurphey.

 

1
Text Only
Opinion
  • 'Too big to fail' equals 'too eager to borrow'

    Four years ago this month, President Barack Obama signed the Dodd-Frank Act into law, promising that the 848-page financial law would “put a stop to taxpayer bailouts once and for all,” he said. But recently, Massachusetts Sen. Elizabeth Warren told a Detroit crowd that “the biggest banks are even bigger than they were when they got too big to fail in 2008.”
    Who’s right?

    July 30, 2014

  • Sheltons travel for better life for family

    Some time around 1865 a mixed-race African American couple, William and Mary Shelton, made their way from Mississippi to east Texas. Nothing is known for certain of their origins in he Magnolia state, or the circumstances under which they began their new lives in Texas.

    July 29, 2014

  • Film critic Turan produces book

    Kenneth Turan, who is the film critic for National Public Radio’s “Morning Edition,” has written a book “Not to be Missed, Fifty-Four Favorites from a Life Time of Film.” His list of movies span the gamut from the beginnings of filmmaking through the present day.
    There are some surprising omissions on his list. While he includes two films, “A Touch of Evil” and Chimes at Midnight” made by Orson Welles, and one, “The Third Man,” that Welles starred in but did not direct. He did not however, include “Citizen Kane,” that was the first movie Welles made, that is  often cited by both film critics and historians as a favorite film.

    July 28, 2014

  • Logan County’s disputed zone

    Watchers of “Star Trek” may recall the episode from the original series entitled, “Day of the Dove.” In this episode, Captain Kirk and his crew are forced by a series of circumstances into a confrontation with the Klingons. The conflict eventually resolves after Kirk realizes that the circumstances have been intentionally designed by an alien force which feeds off negative emotions, especially fear and anger. Kirk and his crew communicate this fact to the Klingons and the conflict subsides. No longer feeding upon confrontation, the alien force is weakened and successfully driven away.

    July 28, 2014

  • Russell leads in Sun poll

    Polling results of an unscientific poll at www.edmondsun.com show that Steve Russell, GOP candidate for the 5th District congressional seat, is in the lead with 57 percent of the vote ahead of the Aug. 26 runoff election. Thirty readers participated in the online poll.

    July 28, 2014

  • Healthier and Wealthier? Not in Oklahoma

    Increased copays, decreased coverage, diminished health care access, reduced provider budgets and increased frustration are all the outcomes of the Legislature’s 2014 health care funding decisions. Unlike some years in the past when a languishing state economy forced legislators into making cuts, the undesirable outcomes this year could easily have been avoided.

    July 26, 2014

  • Medicaid reform a necessity

    Historically, education spending by the state of Oklahoma has been the largest budget item. This is no longer the case. In recent years, the state of Oklahoma spends more on Medicaid (operated by the Oklahoma Health Care Authority) than common education and higher education combined, according to the state’s Comprehensive Annual Financial Report.

    July 25, 2014

  • Remembering lessons from 1974

    This week marks the 40th anniversary of an important milestone in America’s constitutional history. On July 24, 1974, the Supreme Court voted 8-0 to order the Nixon White House to turn over audiotapes that would prove the president and his close aides were guilty of criminal violations. This ruling established with crystal clarity that the executive branch could not hide behind the shield of executive privilege to protect itself from the consequences of illegal behavior. It was a triumph for the continued vitality of our constitutional form of government.

    July 25, 2014

  • RedBlueAmerica: Is parenting being criminalized in America?

    Debra Harrell was arrested recently after the McDonald’s employee let her daughter spend the day playing in a nearby park while she worked her shift. The South Carolina woman says her daughter had a cell phone in case of danger, and critics say that children once were given the independence to spend a few unsupervised hours in a park.
    Is it a crime to parent “free-range” kids? Does Harrell deserve her problems? Joel Mathis and Ben Boychuk, the RedBlueAmerica columnists, debate the issue.

    July 24, 2014

  • Technology that will stimulate journalism’s future is now here

    To say technology has changed the newspaper media industry is understating the obvious. While much discussion focuses on how we read the news, technology is changing the way we report the news. The image of a reporter showing up to a scene with a pen and a pad is iconic but lost to the vestiges of time.
    I am asked frequently about the future of newspapers and, in particular, what does a successful future look like. For journalists, to be successful is to command multiple technologies and share news with readers in new and exciting ways.

    July 23, 2014

Poll

The runoff race for the 5th District congressional seat is set for Aug. 26. If the voting were today, which candidate would you support?

Al McAffrey
Tom Guild
Undecided
     View Results