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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.

For New Governors, Getting Elected Was the Easy Part

November 3, 2010

Voters in more than half of the states elected new governors yesterday — the first time that’s happened since 1938, according to But one thing hasn’t changed: states still face massive revenue problems resulting from the recession. Next year will be states’ worst budget year ever. So what will the new governors do about it?

State Revenues Turning the Corner?

October 19, 2010

The Rockefeller Institute of Government issued a report today that says state revenues are in a “gradual recovery” after their record decline of recent years. The new data that Rockefeller has collected for the report (on revenues for the April-June quarter) are helpful. But it’s too early to say that state finances have turned the corner.

Big Public-Sector Job Losses Dragging Down Economy

October 8, 2010

As our analysis of today’s jobs report explains, a sharp decline in government jobs in September more than offset the small gain in private-sector jobs. State and local governments, still coping with a massive recession-induced loss of tax revenue and their own balanced-budget requirements, eliminated 83,000 jobs in September, and most of the lost jobs — some 50,000 of them — were in education. Since August 2008, states and localities have shed 416,000 jobs (see chart). These numbers suggest three things:

State Revenues Still Flat-Lining, New Figures Show

September 27, 2010

Data on state tax revenues that the Census Bureau released this morning remind us how devastating the recession has been for states’ ability to fund public services — and how important it is that states are closing their shortfalls in part through new revenues, as my colleague Jon Shure noted Friday.

State Budget Cuts Update

August 5, 2010

States have been scaling back services and trimming their workforces for over two years now in response to sagging revenues resulting from the economic downturn. As our new report shows, these cuts continue to deepen. The cuts that many states have made for the current fiscal year (2011), which began in most states on July 1, go even farther than those in past years. To cite just a few examples, in 2011:

Different Charts, Same Picture

July 14, 2010

Congress is back in session and will consider extending the parts of last year’s Recovery Act that have provided extra weeks of jobless benefits and aid to cash-strapped states. The graphs below show why it needs to do both.

State Fiscal Crisis 101

June 14, 2010

With President Obama calling on Congress to extend Recovery Act assistance for states, here’s a set of graphics on:

David Broder: “Unconscionable” Cuts to Education

June 7, 2010

“[W]e cannot commit to raising [educational] standards in one breath and turn around and issue layoff notices to thousands of teachers in the next,” columnist David Broder wrote yesterday, terming it “unconscionable” for Congress to fail to help states avert these layoffs. I couldn’t agree more.