The Woeful State of the States (budgets)

Barron's ^ | March 8, 2010 | Thomas G. Donlan

[reaganaut1]

...

The National Governors' Association recently reported that the states had faced budget gaps of $108.7 billion in fiscal 2010 -- 16% of their total general-fund spending of $664 billion in 2009. They closed $89.8 billion of their gaps, using tax and fee increases of $23.9 billion, and budget cuts of $55.7 billion. For 2011 and 2012, the states already expect budget gaps of $55.4 billion and $61.8 billion.

Such sums are chump change compared with the federal government's current $1.6 trillion budget deficit, but states have been the biggest beneficiaries of that deficit spending, to the tune of more than $500 billion. Without their usual federal aid for such expensive programs as Medicaid and the special stimulus spending, most states would be even more troubled than they are.

Last year's brave talk about "shovel-ready" projects for the federal stimulus package was just hot air, but the 2009 stimulus bill probably did save many jobs in state governments. In 2009, the government sector shed a smaller share of its jobs than any part of the private sector tracked by the Current Employment Survey, run by the federal Bureau of Labor Statistics.

The averages are just the beginning of the story. All states have not created equal crises. The Pew Center on the States tallied budget projections as of last July 31. There was gloom almost everywhere, led, of course, by California, which was projecting revenues 49% lower than the spending necessary to continue all services and give expected salary and benefit increases.

Other big budget gaps: Illinois, 47%; Arizona, 41%; Nevada, 37%; New York, 32%; Alaska, 30%; New Jersey, 29%.

North Dakota and Montana were the only states with no budget gap; those with gaps of less than 5% were Arkansas, Nebraska, South Dakota, West Virginia and Wyoming.

[Diana in Wisconsin]

Bump for Morning Coffee.

Nighty-night from The Heartland. :)

[Gay State Conservative]

Kick out the illegals in the states mentioned (with the possible exception of Alaska) and things would be perfectly manageable.

[elkfersupper]

They're making up for it by launching their cops on a(nother) revenue enhancement power trip (as if they needed any encouragement).

I don't recognize this country anymore.

The place I was born in and was promised has all but disappeared.

[ronnie raygun]

Change in Washington, real change will only come when the states regain their independence from the federal government and become the leader instead of the lead. House cleaning needs to be made at the state level. A strong independent state is a state that can stand on it’s own make the demands needed of the federal government with no strings attached. There is a 4 letter word we must use and apply and also teach our children and that 4 letter word is VOTE!