Ignoring The Real Economy

To the Editor:

Towns like ours, that are trying to ignore what is going on in the real economy and continue the relentless increases in municipal spending and corresponding taxation, are in for a rude awakening. The first of the municipal defaults that can be expected in the coming years is upon us, in Harrisburg. Penn. They have $63 million in municipal debt maturing, which it appears they will be unable to refinance because of their bad spending habits. Chapter 9 bankruptcy is a possibility.

Sound like Greece? Newtown government isn’t insulated from the real world. Revenues are going to be lower. Our interest on the pile of debt is going to increase from its current level of roughly ten percent of the budget to who knows what. State monies are drying up for the foreseeable future and local taxpayers are under stress from the weak economy, and lousy housing market. Ignoring all of this means that the day of reckoning and its forced austerity will be a bigger and deeper shock to the system than the self-imposed restraint that needs to start now.

Our spending on the way up was irresponsible to say the least. The “spend more” crowd is ready to riot in the streets if they don’t get more and more, like the Greeks. So be it. We need to reign spending in and tread cautiously. Vote No on the outrageous budget increase after the second failed referendum. No means No!

Eric Steinkraus

22 Walker Hill Road, Sandy Hook                                  May 26, 2010