NJ Fiscal Folly

Wednesday, February 22, 2006

And Your Point Was?

A few comments to elaborate on my post immediately below.

As my growing list of links should indicate, there is a tremendous amount of data available regarding NJ state and local finances. In fact, the volume is overwhelming, primarily because too many details are presented as little more than a massive data dump accompanied by standard bureaucratic commentary that explains very little. As a result, trying to locate and isolate key financial indicators is a major undertaking. Although I have private sector experience with complex budget analyses, I doubt that many other NJ residents would be able to figure this stuff out.

On the other hand, I don't think you have to be a rocket scientist to identify 20 - 30 key variables that would give NJ residents a very good overview of the state's financial situation, including trends over the last few years. The two variables I selected below, total state debt and total unfunded pension and healthcare liabilities, are pretty basic. The failure to make this kind of data easily available is one way politicians and bureaucrats avoid accountability.

Another problem is the lack of appropriate summary reports. The NJ state government is a complex organization, but that's no excuse for failing to aggregate financial data into more comprehensible units. If you review the currently available reports, most of the top level summaries still include long lists of detailed items, and intermediate level summaries frequently don't exist. There's no way you can analyze and manage the state's financial situation if all the data is presented simultaneously, and you constantly have to flip back and forth between various reports and schedules to try to assemble the relevant pieces in your own mind.

My final point for today is the need for more timely financial information. If you look at some of the dates in my link list you can see that the most recent figures for many kinds of data are 2 - 3 years old. Now I understand some of the reasons for delays in the accumulation of data and publication of financial reports. But I also understand that failure to produce timely reports is another way to evade accountability. This is true in both the public and private sectors. There's no reason to trust our state government if they're unable to provide an accurate description of our current situation.

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