Category Archives: Debt and deficits

Jett: Arkansas needs a ‘stress test’

Leave a reply

Large banks must perform “stress tests” to ensure they would be OK if the economy took a severe downturn. Should Arkansas’ state government do the same?

Former state Rep. Joe Jett, who chaired the House Revenue and Taxation Committee for eight years until he left the Legislature in 2022, believes it should. He’s particularly concerned about what would happen if the federal government reduced the billions of dollars it sends Arkansas’ way.

The former lawmaker and farmer from Success, Arkansas, now splits his time between working with the Rose Group Advisors business strategies and lobbying firm, crop dusting, and being a relief aerial firefighter fighting wildfires in the West. He’s also a grandfather to four grandsons ages 6-16. His two sons now run the farm where he and his wife still live. 

Jett said state government should perform stress tests like large banks must do under the 2010 Dodd-Frank Act, which was a response to the preceding financial crisis. Some states have already started doing so. Continue reading →

Social Security crisis this year’s election secret

tax, taxes, debt, deficits, spending, trillion, State of the Union, deficit hawks, balanced budget amendment, Jonathan Bydlak, immigration, $98.8 trillion, $970 billion, Social SecurityHere’s an issue not being discussed much in this year’s campaign: The winners of U.S. Senate races across the country likely will face a Social Security crisis near the end of their terms, about the time they would run for re-election.

 In Arkansas, that would be Sen. Tom Cotton or one of the candidates seeking to replace him.

Both the Social Security Administration’s actuaries and the Congressional Budget Office have said that the Old-Age & Survivors Insurance Trust Fund, which pays seniors’ Social Security benefits, will become insolvent by the end of 2032.

That’s less than seven years from now. Continue reading →

Arkansas projects get funded as debt elephant gets ignored

tax, taxes, debt, deficits, spending, trillion, State of the Union, deficit hawks, balanced budget amendment, Jonathan Bydlak, immigration, $98.8 trillion, $970 billion, debt elephantCongress has funded most but not all of the government. Four members of Arkansas’ congressional delegation secured hundreds of millions of dollars for highways and other state projects. Meanwhile, a nonpartisan group is warning of the consequences of ever-increasing government debt.

That paragraph pretty much sums up the federal budget news from the past couple of weeks, with more to come. 

As you may not have noticed, there was another government shutdown last week, though only a partial, brief one. It ended when President Trump on Feb. 3 passed the second of two bills that funded government operations through September – all except for the Department of Homeland Security, which got funding for only two weeks until Feb. 13.

Democrats balked at funding that agency because they want major reforms to its Immigration and Customs Enforcement (ICE) operations. As of Sunday evening, the question had not been resolved. 

So we’re in another partial government shutdown. Continue reading →

A $40 trillion debt party?

By Steve Brawner

© 2025 by Steve Brawner Communications, Inc.

The national debt reached a new milestone last month. Did anybody notice? 

Maybe a party would help.

Sam Sicard, president and CEO of First National Bank of Fort Smith, offered that suggestion in a text message Tuesday. 

The day before, the national debt had reached $37 trillion.

Sicard, who has tried to call attention to the issue for years, texted, “Let’s plan a ‘Hit $40 trillion’ party for next year.”

He was being sarcastic about planning a party, but not about the concept. 

“Bottom line is we need to find ways to grab voters’ attention, and parody of the recklessness is another approach,” he wrote. Continue reading →

Arkansas’ credit can’t escape Uncle Sam’s ills

By Steve Brawner, © 2025 by Steve Brawner Communications, Inc.

Governments want good credit ratings just like individuals and businesses do. In that respect, the U.S. government is moving in the wrong direction, and Arkansas is moving in the right one – for now.

S&P Global Ratings recently raised its long-term rating on the state of Arkansas’ general obligation bonds to AA+. It’s the state’s highest rating since 1966 and the second highest on S&P’s scale after AAA.

Meanwhile, Moody’s Ratings kept the state at Aa1, also its second highest rating, and said its outlook was “stable,” meaning it doesn’t think things will change. On May 16, it wrote, “The Aa1 issuer rating reflects the state’s strong governance practices, high reserves and low leverage. The state’s proactive and conservative budget management has driven a material increase in reserve levels while lowering tax rates.”

Sounds good to me.

Gov. Sarah Huckabee Sanders touted the state’s ratings in a press release, saying they could attract potential investors. Department of Finance and Administration Secretary Jim Hudson pointed to the $1 billion Arkansas Reserve Fund. 

The news was not so good at the national level. That’s where Moody’s downgraded the federal government’s credit rating from Aaa, the highest possible, to Aa1. Continue reading →