I’ve always said you cannot have too much debt. The problem with debt, however, arises when your cash flow cannot pay the obligations of the prior borrowings.
The previous two Stewart Blogs detailed personal and state+local debt on a per capita basis by state. This blog will add those two together, include the federal debt obligation per capita and household and then relate household income by state. All data are circa 2017 for consistency.
The federal debt totaled $20,244,900,016,054 in 2017. With a population of 323,405,935 at that time (per the U.S. Census Bureau), per capita federal debt was $62,599 or $164,635 per household (at an average 2.63 people).
The following table shows the per capita debt by state for the 10 states with the most debt per capita.
The 10 states with the least total debt per capita are shown in the next table.
The next table shows the same data for all 50 states and the District of Columbia in Alphabetical order.
When examined on a per household basis, some of the ranks change given the differences in people per household. The following two tables show the 10 states with the greatest and least levels of debt per household.
Data for all states for debt per household are shown in the next table.
The next tables shows the 10 states with the greatest and least debt–to-income multiples. Pushing Louisiana onto the top position is a relatively low median household income as average state household debt is less than the U.S.
Debt to income multiples for households by state are shown in the following table.
To read the prior two Stewart Blogs on debt click:
Many argue that the amount of federal debt is materially understated. Some believe that from $70 trillion to $95 trillion of known future obligations are unfunded. They include federal retiree benefits, and payment to Social Security recipients and Medicare participants. These were not included in this analysis.
Even though government debt exists, not every taxpayer faces the same burden. The Tax Policy Center states that 44 percent of all people paid no income taxes in 2018. This makes the burden of payment of federal taxes unequal across the states.
Stewart’s former Co-CEO often said, “You can’t go broke if you don’t owe anyone.” There’s a lot of truth in that statement. Debt does, however, provide opportunities that would otherwise not exist. Imagine not being able to purchase a home until having saved the entire purchase price. Remember, it’s not about the total amount borrowed, but the amount and timing of the repayment that counts.