Veronique de Rugy: State-Based Accounting 101
States must confront pension costs.
New research by the Mercatus Center's Eileen Norcross reveals that more fiscal disasters loom in the United States. She ranks each state's financial health using data from standardized and audited Comprehensive Annual Financial Reports (CAFRs) that show short- and long-term debt along with key fiscal obligations, including unfunded pensions and health-care benefits. Beyond the ranking itself and the disastrous fiscal health of several states, the study points to worrisome structural weaknesses shared by most states. Unfortunately, these issues are mostly overlooked by ignorant or unscrupulous state officials who are blinded by poor accounting techniques, writes Veronique de Rugy.