Posted on 02/07/2011 12:27:13 AM PST by dragnet2
The Lone Star State is facing a budget gap of about $27 billion, putting it in the same league as California among states facing financial meltdowns.
Texas has a two-year budget cycle, which allowed it to camouflage its red ink last year, thanks in large part to billions of dollars in federal stimulus money.
As if to punctuate the point that Texas has found itself in a California-style mess, a power-grid problem caused rolling blackouts statewide Wednesday as the Capitol was consumed with fiscal crisis.
"It's going to be a tough time for us," said Rep. Warren Chisum, a Republican
"There is no indication that there is going to be a robust economic rebound,"
The state has much lower unemployment than California, but economists note that many of the jobs are low-paying. One out of three wage earners in Texas earns too little to keep a family of four above the federal poverty level, according to a 2009 study by the Corp. That is double the percentage of similarly low-wage Californians.
Texas lags far behind California in major research universities, patents produced, high-tech infrastructure and venture capital investment, according to the Missouri-based Kauffman Foundation. The foundation's 2010 ranking of states in "movement toward a global, innovation-based new economy" put California at No. 7. Texas was No. 18.
"For all the talk of Texas being a high-tech state, they have never really caught up to California.…
Even Perry's claims of companies that have decamped from California to lay down roots in Texas appear to be overblown. Austin American-Statesman looked into the Texas governor's boast that there were 153 such companies in 2010, reporters found the claim included California firms that stayed put but maybe opened a Texas branch. The newspaper concluded that Perry's figure was grossly inflated.
(Excerpt) Read more at latimes.com ...
If Texas is in trouble weeeeee’re doooooooooomed......
I wonder if there is some kind of common factor that is contributing to the financial woes of these two border states?
Part of the mainstream Media’s “they all do it” strategy. Have to trash a conservative state to make it all ok.
Can't cut spending since the elderly are going to suffer.
Need to raise taxes (close loopholes)
Need to spend more for education.
blah, blah, blah.
Ask Tom Tancredo.
They seem to think that our government has the same agenda as California’s. and the same political make-up. Republicans have a 2/3 majority in the House and almost the same in the Senate. Plus no public employee-unions. This gives Texas a head start. Educational cuts are already in the offing. There are fewer sacred cows.
Of course: We both have Democrats.
But this CNNMoney article should give you an idea about the difference between Texas and California.
Texas lawmakers unveiled a Spartan budget late Tuesday night that slashes $31 billion in spending to close the state's massive budget deficit. Education, Medicaid and corrections would be hit particularly hard. House legislators were forced to rely on spending cuts to close the shortfall -- estimated at between $15 billion and $27 billion -- because Republican leaders pledged not to raise taxes. They also did not touch the state's projected $9.4 billion rainy day fund, one of the most flush in the nation.
The spending plan calls for a 13% hit to public education and a 7.6% drop in higher education support. Among the cuts, funding for pre-K Early Start programs would be slashed, and four community colleges would be closed.
SNIP
Health and human services would see funding plummet by nearly a quarter, while government services would fall by almost the same percentage.
Nearly 9,300 government jobs would be eliminated and Medicaid providers would see a 10% rate reduction. Fewer residents would receive meal deliveries and services to keep them in their homes. Some 60,000 students would lose financial aid for college. Funding for defending the poor in court would drop by 15%. And the department that supervises and supports parolees would by cut by nearly 21%.
One reason for the harsh cuts is the end of federal stimulus funds for the states. Texas had included $6.4 billion in stimulus money during its most recent 2010-11 budget. The new spending plan does not replace these funds with state money.
Until now, Texas had weathered the Great Recession fairly well, buffered by its vast oil and gas industries. It avoided the housing industry meltdown and its unemployment rate is below the national level. It also benefited from having a two-year budget cycle so officials have not had to craft a spending plan since 2009.
SNIP
"Texas families have had to set priorities and make difficult decisions in order to live within their means," he said. "The introduced budget is a positive sign that the Texas Legislature is committed to doing likewise."
As you might expect, there is a big fight going on as we move to make these cuts and those which will surely come. And I expect we'll see taxes eventually go up.
The difference in TX and CA is we aren’t talking about adding more debt, but rather cutting spending. We have a back up fund that I doubt you would ever find in a long time dem run state.
The obscene spending spree the dems and Obama have been on for two years and the high unemployment rates are going to have consequences on every state. We didn’t get huge bailouts like the blue states the dems and Obama lavished funds on. Most importantly, our leaders are talking about cutting spending and not blowing through our back up funds. Let’s see which state comes out in better shape once Obama is gone and some of his stink is cleaned up behind him.
Interesting: TX is sitting on a 9B rainday cookie jar of cash that has not been raided. They are in a situation somewhat like CA.
A quick wikipedia (?) snoop yields this about CA:
“In California, for instance, the rate for a single individual begins at 1% at $6,622 in income and rises to 9.3% over $44,814[2]. In 2005, California added a mental health tax of 1% on incomes greater than $1 million, making the marginal income tax rate in that state 10.3% at the extreme income ranges.”
And TX is keeping pace nicely with CA finacially... yet they have NO personal income tax. They artfully use a whole slew of other revenue sources.
Well, for one happens to be a People, looks like TX is a great place to be. That CA mental health tax must be to drive you completely nuts just in case your crazy enough to reside in CA and have an income > 1M. I like that phrase “extreme income”. Hey dude, you make an extreme income, let’s just levy a mental health tax on you, you’ve gotta be bats to live here.
Is that cookie jar one of those IOU funds. Where the money has been spent twice before, if not what is it invested in.
lol
You got it. First clue this is Liberal spittle was the source LA Slimes. Second clue the authors reference to Austin American-Statesman.
I’ll believe it when I see it from say Human Events, or Heritage.
lomao... LA Times reporting on Texas?! Guess they need something to redirect blame (equalness) to... Sorry Cali peeps... nothing to compair :p
States taxes literally kill...
Bikk
Who do you think designs those Chinese-made electronics? Farm animals?
They both have politicians?
LA Times reporting on Texas?! Guess they need something to redirect blame (equalness) to...
I hope they also publish this in Spanish too. Please, please, please convince all the readers of the LA Times that Texas is actually far worse off than California and we are nothing but illiterate rubes and gun toting hicks.
Texas is horrible - we can't even make our own power! Go Away!! It's like Hell, only worse!
(the productive element of society knows better)
“We didn’t get huge bailouts like the blue states the dems and Obama lavished funds on.”
“Texas public schools stand to receive as much as $6 billion in support from the stimulus. And our health care system may see as much as $6 billion in the form of assistance to low-income, under-insured families and uninsured children.”
“Finally, by putting doing what is right for Texas first – and politics last – our state can assist laid-off workers with up to $500 million in unemployment assistance.”
http://www.txstimulusfund.com/
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