If you live in a small city, you can see whether your local governments is in trouble by comparing its annual deficit with the federal government.
The average deficit is a little over $2 billion, but that doesn’t mean your local public officials are paying their fair share.
According to a report by the nonprofit Taxpayers Alliance, local governments in Michigan and Ohio had a combined $1.7 trillion in federal and state government debt as of January, 2016.
It’s unclear whether these local governments were able to balance the books, but there’s no reason to assume they wouldn’t.
Here’s what you need to know.
The Big Six: Local governments that have more than $2 trillion in debt, by state, 2015 Source: Taxpayers Association of America/Associated Press via ThinkstockThe federal government owns roughly 70% of all public debt in the U.S. The next highest percentage of debt belongs to the state of Michigan, where it was at 15%.
That makes Michigan the state with the second-highest percentage of state debt of any state.
The other states with the highest proportion of state government’s debt are Kentucky, Louisiana, Mississippi, Tennessee and Virginia.
It should come as no surprise that these six states have the highest ratio of state governments’ debt to their GDP, which is roughly 4.5 times.
State governments are generally responsible for paying their own bills.
In most states, they are also responsible for their own debt.
What’s in a name?
The word “debt” in the federal budget includes the value of the debt, which includes interest payments, and also includes taxes, interest, and other payments from other sources.
When federal money is used to pay for services, like schools or highways, the federal funds are included.
The federal government does not own a percentage of a local government’s net assets.
Federal debt is a lot higher than local government debt.
According the Taxpayers Associations report, local government net debt exceeded $2.6 trillion for the first time in 2020, a $1,000 increase from the previous year.
The ratio of debt to GDP in each state grew from 5.5% to 6.1%.
In Ohio, for example, the ratio was 7.4%, a 1.6% increase.
There are three main reasons local governments have higher debt.
1) State governments don’t have to pay federal taxes, but local governments do.
Federal law requires local governments to pay taxes on their property, including sales taxes and property taxes.
In some states, local taxes are considered an essential component of government operations, but not everywhere.
In many states, a local tax that doesn