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Texas begins steps to protect financial solvency in case of US economic collapse

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Texas legislators have begun steps to protect the State of Texas from US economic collapse. 

In January, HB 568 was filed by Rep James White http://www.legis.state.tx.us/BillLookup/History.aspx?LegSess=83R&Bill=HB568 

AUSTIN — Rep. James White, R-Hillister, filed a bill Friday that would create a committee to review whether Texas could keep operating without receiving federal dollars.

The bill, HB 568, would create the Select Committee on Budget Dependence on Federal Funding composed of legislators, budget experts, and citizens from the non-profit sector who will analyze what will happen if the federal government is no longer able to provide full funding to the state because of "possible reduction in or elimination of federal funding on the state budget due to federal fiscal policy." The committee would present their findings in a report to state leaders.

“Due to the fiscal dysfunction of Washington, D.C., and the fact that more than a third of our state’s budget revenue comes from the federal government, Texas needs to study what it would mean if the Federal Government couldn’t meet its obligations,” White said.

Federal funds account for about $64.7 billion — roughly 34 percent of the House base budget of $189.9 billion. That money goes toward Medicaid, public education, transportation and other areas.

A November blog by reporter Dave Michaels highlighted what would happen to Texas if the U.S. went over the fiscal cliff. One solution to a loss of about $656 million of federal funding in that instance was to bring back the state estate tax, which would collect between $62 million and $317 million in 2013, “depending on the estate tax’s top rate and the amount of inheritance that is excluded from taxation.”

“Speaker Straus should be commended for naming a House interim committee on sequestration. However, we must expand on this work. My district in South East Texas, for example, has a higher proportion of seniors compared to the state overall percentage. What would happen in the event the Federal Government eliminated the funds normally allocated to them?” White said. “In the current economic climate, exacerbated by out of control spending in Washington, Texas needs to study possible responses to Federal financial turmoil and our readiness to adjust to such an event. Texans must govern Texas and Texans need to be concerned about Texas.”

 

In February, HB 1930 was filed by Rep Matt Krause http://www.legis.state.tx.us/BillLookup/History.aspx?LegSess=83R&Bill=HB1930

AUSTIN, TEXAS - Today, Rep. Matt Krause filed H.B. 1930, which creates the Fiscal Risk Management Commission (FRMC). This commission would be comprised of elected officials and members of the public and be tasked with the assessment of, and planning for, a wide spectrum of potential economic threats to the state of Texas.

"Other states have already begun to take the initiative by studying and creating long-term contingency plans to protect their credit ratings, economies, and the delivery of fundamental government services," said Rep. Matt Krause. "With an unyielding $16 trillion debt, it is apparent that our federal government is fundamentally incapable of solving this crisis. If you look at the current uncertainty in D.C. with the sequester, and before that the fiscal cliff, and before that the debt ceiling, it's clear Texas needs to step up and take a leadership role in our citizens' economic security."

The FRMC would study all possible economic threats to Texas, including:

1. Significant reduction or elimination of federal funds on delivery of critical services and the state budget;
2. Effect of political or market-led default on state economy;
3. Impact of devaluation of U.S. Dollar and loss of reserve currency status on Texas;
4. Advisability and practicability of developing a contingency currency for Texas;
5. Risks presented by acts of economic terrorism (i.e. energy embargo) on Texas;
6. Any other macroeconomic threat to Texas FRMC considers appropriate.

"The FRMC would be charged with publishing a Fiscal Risk Management Plan, which would contain all research, findings, and drafts of proposed legislation the commission recommends," continued Rep. Matt Krause. "Governments have contingency plans for a wide array of threats, such as hurricanes and other storms. There is no need for our state to be caught flatfooted by any number of economic storms that are not only possible, but some of them are highly probable. Our citizens and business owners deserve strong action on this matter."

 

I for one, am proud to be a Texan. texas

Entry #41

Comments

1.
CajunWin4Comment by CajunWin4 - March 10, 2013, 1:14 am
The rest of the States need to follow in TEXAS foot steps SOONER then Later !!!
2.
jackpotismineComment by jackpotismine - March 10, 2013, 9:47 am
Agreed. They need to get rid of the fed.

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