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Wisconsin Governor’s Budget Takes Aim at Low-Income Working Families

March 3, 2011

Wisconsin Governor Scott Walker’s budget would force low-income working families with children to pay $41 million more in income taxes over the next two years by cutting the state’s earned income tax credit (EITC), giving him some of the revenue he needs to cover $200 million in recent and proposed tax cuts for corporations and wealthier people.

States Should Take Action to Avoid Billions in Revenue Loss

March 2, 2011

A federal business tax cut that was part of the tax deal that President Obama and Congress enacted last December could cost states billions in lost tax revenue at a time when they are already struggling with recession-induced budget shortfalls and making deep cuts in education, health care and other key services. Luckily, there’s a way for states to avoid taking the hit.

S&P Agrees: A Balanced Approach Is the Right Way to Tackle State Shortfalls

February 25, 2011

With unemployment still high and revenues still 11 percent below pre-recession levels, states must close over $125 billion in shortfalls as they enact their budgets for fiscal year 2012, which begins July 1 in most states. The critical question is this: will they do so through spending cuts alone or through a more balanced approach that includes a mix of strategies, including higher revenues?

Tax Cuts Widening Wisconsin’s Budget Hole

February 23, 2011

While much of the national attention on Wisconsin in recent days concerns Governor Walker’s proposal to strip many public workers of collective bargaining rights, the role of the tax cuts in widening the state’s budgets problems also merits a close look:

For State and Local Workforce, the Recession’s Still On

January 11, 2011

The state and local government workforce — teachers, nurses, police officers, and others — continues to suffer from the 2007-2009 recession, even as the private sector slowly gains jobs.

Recession Lies Behind State Budget Problems

January 6, 2011

When it comes to state finances, the big story is still the old story: the recession, and the way it has continued to hurt states’ ability to keep up with rising needs.

Some Right, Some Wrong in “60 Minutes” Story on State Budgets

December 20, 2010

Last night’s CBS “60 Minutes” piece on state budgets made some important points but also — through some big mistakes and omissions — gave a deeply misleading impression of the state budget situation.

Long Road to Recovery for State Revenues

November 30, 2010

Today’s Rockefeller Institute report has some positive news: state tax collections in the third quarter of 2010 were higher than in the third quarter of 2009. However, the overall state budget picture is still bleak, as revenues are 12 percent lower than they were before the recession, adjusted for inflation. The report concludes that “the immediate outlook is for revenue collections significantly below prerecession levels, and growing spending pressures. The overall picture remains: States will face continued, significant budget challenges in fiscal 2011 and beyond.”

Obama’s Business Expensing Proposal Would Prove Expensive for States

November 15, 2010

President Obama has proposed a new tax break for business investment. It’s intended to boost the economy, but it would have the unintended effect of worsening states’ already severe budget problems. That, in turn, would force states to take steps that would undercut the hoped-for economic stimulus.

State Budget Problems Are Hardly Partisan

November 12, 2010

Talk about seeing the world through rose-colored glasses.

Michael Gerson writes in today’s Washington Post, under the headline of “Blue-State Budget Crises,” that “massive state budget shortfalls” are “concentrated” in “predominantly Democratic states.” Well, no. Actually, fiscal distress is as nonpartisan as the recession itself. Republican-dominated states like Arizona, Georgia and South Carolina all faced budget shortfalls for the current fiscal year equal to more than one-quarter of their budgets, as did the “swing” states of Maine, Minnesota and Nevada.