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TOPIC: Bond Burden

Bonds

For 30 years, California has spent money without appearing to do so: The politicians borrow it. The state issues billions in bonds every year, with more than $111 billion in General Obligation bonds already approved.

Now California has the second highest bond burden and the worst bond rating of all 50 states. And the long-term bills for those 20- to 40-year bonds are coming due:

  • In 2010–2011, we paid $5.45 billion to service bonds the state has issued, or 7.1% of what we spent as a state the entire year.
  • This will double in the next 3 years, to $11.1 billion—10% of our annual spending. The numbers will continue climbing over the next decade, as well.
  • California Treasurer Bill Lockyer said in 2011 that California already owes $91 billion in bond debt—$2,542 per person for bond debt alone.

That’s $10,000 for a family of four…twice the national median!

This growing bond debt is killing the future for our children and grandchildren—and we need to get it under control sooner rather than later.


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