The House of Representatives is expected to vote tomorrow on a measure the Senate approved last week to extend badly needed education and health care assistance for states from last year’s Recovery Act. Here are the amounts each state would lose if the House fails to approve the funding.
BEYOND THE NUMBERS
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:
A new survey of leading economists about the state budget crisis adds ammunition to the case for more federal fiscal relief. Lawmakers should take a close look and reconsider their failure to provide additional relief to date.
“It could’ve been a lot worse” may not be a winner as a political message, but it’s the right response when people complain that the TARP financial stabilization bill and the 2009 Recovery Act didn’t work. This chart, based on new data on gross domestic product (GDP) released this morning, shows the turnaround in the economy since Congress enacted these measures.
As states tally up spending and revenues for fiscal year 2010, which ended June 30 in most states, some (such as Virginia and Connecticut) are finding that they ended their year with their budgets in the black. Here’s what those modest “surpluses” mean — and what they don’t.
Most states started their 2011 fiscal year on July 1, and we’ve updated our analysis of the budget shortfalls — that is, the gaps between revenues and spending — that states closed when adopting their budgets. As the map shows, nearly every state faced a shortfall for 2011; in 18 states, the shortfall exceeded a fifth of the state’s spending.
Several states, including Maryland and New Jersey, have reported a decline in their millionaire population in the past couple of years, and advocates for cutting taxes have been quick to argue that this shows high-income residents are fleeing to other states with lower taxes.
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.
In a New York Times op-ed, Chris Edley rightly warns that state budget cuts and tax increases are undermining federal efforts to boost the economy; that’s why we’ve recommended (most recently here) that Congress extend the state fiscal assistance in last year’s Recovery Act.