Investment advisor and Fox Business News commentator Stephanie Pomboy has alerted us to some bad news: state and local government spending is soaring nearly as rapidly as the $7 trillion federal budget. It’s no secret that the States were primary recipients of the lavish Federal spending during and after the pandemic.

But after two years of swimming in cash, Pompey finds: “Surpluses have evaporated and, in many of the largest states, large deficits are emerging. California has gone from a $56b surplus in 2022-3 to a $73b deficit.” New York, Illinois, and New Jersey have also seen surpluses vanish.

This comes at a time when local tax receipts have turned negative year-over-year for the first time since after the Great Recession.

It’s noteworthy to us that the biggest deficits are showing up in the blue states that received massive federal handouts, partied like it was in 1999, and are now facing the day of reckoning.