$37.8 Billion Borrowed From Treasury To Fund Unemployment; CA, MI, NY Worst
By Tyler Durdin
“In 2009, the State of North Dakota does not have any funding issues at all. We, in fact, are dealing with the largest surplus we’ve ever had.” Eric Hardmeyer, president of the state-owned Bank of North Dakota.
Courtesy of Economic Policy Journal we now know that the majority of American states are currently insolvent, and that the US Treasury has been conducting a shadow bailout of at least 32 US states. Over 60% of Americans receiving state unemployment benefits are getting these directly from the US government, as 32 states have now borrowed $37.8 billion from Uncle Sam to fund unemployment insurance.
The states in most dire condition, not unexpectedly, are the unholy trifecta of California ($6.9 billion borrowed), Michigan ($3.9 billion), and New York ($3.2 billion). With this form of shadow bailout occurring, one can only wonder how many other shadow programs are currently in operation to fund states under the table with federal money.The full list of America’s 32 insolvent states is below, sorted in order of bankruptedness, in millions of dollars.