Sunday, February 08, 2009

When 49 Herbert Hoovers Attack

With apologies to Paul Krugman, we need to knock it down to 49 instead of 50. The state of Wyoming, with its half million people or so, appears OK for the moment, or maybe I just didn't dig deep enough.

Here is a cursory look at what happens when you Google "state budget cuts" with the name of the state behind it. Things have gotten drastically worse in the past two months in many cases; some governors are even putting off their budgets with the hopes that the stimulus will help them. Most states are not ashamed of using it to fill budget holes either - Strickland is building his budget around it as a matter of fact. Southern Republican strongholds may claim they don't want the stimulus, but they quietly admit they will take it and use it.

In comparison to states that are around our population size, Michigan's $1.6 billion is less than what some of our counterparts are facing. In the Great Lakes area specifically, Ohio, Wisconsin, and especially Illinois, are all facing bigger deficits than we are. Even Michigan Republican darling Indiana has made massive cuts, with more to come. The Michigan GOP wail and cry that this is a "one-state" ordeal is ludicrous in the face of what is happening all across the nation, and the thought that the 2007 increases weren't necessary should be banished immediately - we would be facing the same kind of deficits that are neighbors are now facing, probably even worse, had we not acted when we did - and it's going to be bad enough as it is.

Reading these stories, what these states are doing to health care and education in particular, makes the US Senate's action to cut $40 billion in aid seem all the more cruel.

All 50 states are listed below, and things are changing by the day.

Alabama: Gov. Bob Riley plans "thousands of layoffs" and cuts to education, and is banking on Medicaid money to avoid cuts to health care. The state is taking a wait and see attitude and banking on the stimulus, like many others, and will be tapping its rainy day fund to help fill a $253.3 million general fund deficit and $800 million education budget deficit. Alabama's Congresscritters opposed the stimulus 6-1, and we don't even have to mention their esteemed senators, do we?

Alaska: Gov. Palin wants to tap state reserves to cover a $1.36 billion shortfall; "unspecified cuts" of $268 million also in the works. The state had over $7 billion socked away; they have spent around $2 billion of that in the last nine months or so.

Arizona: State layoffs, closing parks, cuts to education, both K-12 and universities, "eliminate a welfare program for disabled people waiting for Social Security benefits and require low-income people getting subsidized health care to pay new monthly premiums", eliminate economic development research grants, all to cover a $1.6 billion deficit. They too are banking on Medicaid money.

Arkansas: $62 million in cuts; education and Medicaid bear the brunt, plus others such as the state police. Raising taxes on cigarettes, cutting taxes on groceries. (until last year Arkansas taxed groceries at 6%)

California: The problems in California are well reported - just Google "state budget California" and start reading. Apparently they have begun the process of shutting down the state government, period. With a $42 billion deficit, various plans for drastic cuts coupled with tax increases have gone nowhere with battling lawmakers and Gov. Schwarzenegger.

Colorado: With a $1 billion deficit over the next 18 months, Colorado will close two prisons, cut education spending, cut a mental health facility, eliminate a raise to Medicaid providers, furlough and freeze pay for state employees, and eliminate a property tax break for seniors.

Connecticut: Looking at an $8-11 billion dollar shortfall over the next two years, Rell's cuts have been called "draconian" in some articles; cuts to cities, health care, laying off state employees and asking for concessions, and increasing "fees". They also are looking at consolidation of government agencies. Banking on stimulus as well, in a big way.

Delaware: $606 million in the hole, Delaware is looking at big cuts to higher education, and "programs and services" will be eliminated.

Florida: Legislators cut almost $1 billion from schools (!) to get halfway to erasing a $2.4 billion dollar deficit. Medicaid cuts to nursing homes will be 10%; predictions of job losses and bankruptcies in the industry abound. Florida has cut law enforcement, and they also have eliminated drug treatment programs, with clients now looking at jail and kids winding up in foster care. The state is the great GOP "drown government" experiment with cuts of nearly $7 billion since July of '07, and they aren't done yet - they look to cut $3 billion more this year. These are monster numbers. Keep an eye on Florida - this is what happens when the Republicans get their "all cuts" way.

Georgia: Looking at a $2 billion dollar shortfall already, and revenues plunged in January. The state's GOP contingent is against the stimulus, but they will take the money if it comes, you betcha, because they are in some deep trouble. Looking at a cigarette tax increase and a "cut" on a property tax cut. State agencies will take a 10% hit, and employees are looking at furloughs. Education is a target.

Hawaii: Hawaii already whacked their government last year, from cuts to social services, government agencies, libraries, education, health care - you name it, they probably cut it. Now they are looking at another billion dollar shortfall for 2010, and are busy tapping reserves and warning state departments of more cuts to come.

Idaho: Already cut 4% across the board, and their January revenue also took a huge hit, so they are looking for more cuts. Stimulus figures in plans. Health care has already been slashed, state employees are being laid off, fuel taxes are being increased to fund road construction/maintenance.

Illinois: $9 billion dollar deficit, nearly "twice as big as they thought", and 15% of the total state budget. With Pat Quinn just getting comfy in his new job and dealing with Blago fallout, the state will battle this spring over what to do about the budget. Illinois is looking at increasing income taxes. Desperate for stimulus money.

Indiana: Daniels already cut $763 million in December; cuts to higher education, pay and hiring freeze on state employees, unspecified "significant savings" in Medicaid, cuts to cities and tourism - and declining state revenues could force another $400 million by summer. Pressure to tap state reserves.

Iowa: Chet Culver already ordered a 1.5% cut across the board in December to close a $90 million gap, now he is calling for another 6.5% and is looking to tap $200 million in state reserves. These cuts would effect 205 state programs.

Kansas: Gov. Sebelius ordered a 3% cut back in November, including higher education. Now the state is looking at another $199 million short by summer, and they are busy transferring money between departments, and looking at more spending cuts.

Kentucky: Faced with a $456 million deficit, Kentucky wants to raise cigarette taxes by .70 a pack, and is facing a 4% reduction to state agencies. Trying to avoid cuts to schools and health care, but no one will be spared the ax. State employees being asked to shoulder more of the burden, and lawsuits in that regard are popping up.

Louisiana: Governor Jindal cut $341 million back in December; health care, social services and education paid the price. Tuition is starting to increase, colleges are laying off employees. Worse case scenario has 10 hospitals closing with new budget cuts due by July 1st.

Maine: Budget cuts were already made last year, now Maine is facing another $838 million blow to its bi-annual budget. A 2.4% cut to higher education, layoffs of state employees, closing housing units at prisons, raising fees on hunting and fishing - and a banking on the stimulus money, all in the works as lawmakers look to close the hole.

Maryland: Cut $300 million from state budget last fall; health care and higher education took the hit. Arts did as well. State employees are being furloughed. $2 billion has been cut in the past couple of years, and more is on the way.

Massachusetts: Made budget cuts of "historic proportions" last fall to close a $1.4 billion dollar hole. Whopping hits to Medicaid and other health care programs, layoffs of state employees, cuts to law enforcement, mental health, substance abuse, just about everything you can think of were deep and painful, and the fallout is still being reported as cities and agencies deal with the aftermath.

Michigan: $1.6 billion down. Stay tuned, because after looking at half the country, you can start to grasp just what it is we are up against. Governor Granholm presents the cuts this week, and "there will be pain all around".

Minnesota: Looking at $7 billion down over the next two years, and the figure increased by $2 billion in the past two months alone. Pawlenty is facing heat even from his own party - calling for cuts to health care and revenue sharing to cities, shifting payments into future budgets and borrowing money, while calling for tax cuts to business and and an increase in funding to schools, doesn't really add up.

Mississippi: Barbour cut 2% from the budget last July - $42 million - and is now looking at deeper cuts after revenue fell dramatically in December. State departments took freezes and other cost-cutting measures, this time education and health care might be on the line.

Missouri: Missouri is looking at $261 million in the red and Gov. Nixon has suggested slashing over 1300 state employees and 20 state programs. Both the governor and the legislature are looking to plug budget holes with the federal stimulus money.

Montana: A state that had been in pretty good shape, they are now running a deficit of $220 million over three years as conditions are getting worse. Higher education cuts are in the offing.

Nebraska: Doing OK for '09, but facing a $152 million gap in '10 at latest report. Has limited enrollment into child health care programs to save money.

Nevada: Facing a $2.3 billion shortfall over the next two years, Republican Gov. Gibbons is looking at a budget that is 9% lower than the current one, with cuts to K-12, higher education, environment, tourism, and Medicaid reimbursements to hospitals and doctors. Lawmakers are looking at tightening loopholes on tax exemptions and going after tax cheats - but many stories indicate that Nevada is very much counting on the stimulus money for help.

New Hampshire: The small state has cut $16 million out of the budget, has a current deficit of $65 million, and a projected deficit of $300 million by June due to declining revenue. Gov. Lynch has asked department heads for a 3% cut across the board, and will present a budget this week with possible cuts of state employees, health care, and aid to cities.

New Jersey: Governor Corzine has put off his budget presentation until March, counting on the federal stimulus money to save the state for making drastic cuts in the face of a $2.1 billion dollar shortfall. Corzine is scrambling - a bill for cities to defer pension payments has been introduced, layoffs of state employees has been threatened. New Jersey just got done with a bruising battle to raise taxes a couple years ago, and Corzine is looking shaky for re-election this year.

New Mexico: Approved cuts and shifts to cover a $450 million deficit, including reduction of capital outlay projects, shifting money from a state reserve fund, "speeding up" corporate tax payments (can we do that?), and a 1% reduction to education and Medicaid.

New York: Almost as legendary as California, the state has closed a $1.6 billion shortfall with "spending cuts, tax increases, and accounting devices, along with the government equivalent of piggy-bank raid" for this year's budget. This buys them all of two months, and then a monster $13 billion deficit will hit them in the new fiscal year that starts April 1st. Massive cuts to education and health care are rumored.

North Carolina: Faced with a $2 billion dollar shortfall, Gov. Perdue was dismayed when state departments only came up with a 7% reduction across the board. She was looking for programs "that could be killed". Biggest cuts offered so far: closing seven prisons, a 12% reduction in pensions to the NC National Guard, and massive cuts to Medicaid providers, children's health insurance, and mental health care.

North & South Dakota: Two states that are relatively unscathed, only because about 500 or so people live there. North Dakota has its revenue projections report tomorrow, and already they figure that cuts will have to be made due to the drop in the price of oil. State employees and "one time spending bills" will be on the block. South Dakota is looking to eliminate its Arts Council, which includes aid to symphonies, theatres, museums and school programs.

Ohio: Ohio operates on a two year budget, and as December had already cut $1.3 billion out of a budget year that ends this June. Further cuts of $640 million are projected by then as well. For the new budget year of 2010-2011, Gov. Strickland is calling for a bigger general budget, funded in part by the stimulus money, higher state fees, and pay cuts to state employees. Ohio is looking to reform their government as well - with state programs being funded with only 80-95% of their current levels, and major shifts in money between budget years. Ted is very much counting on the stimulus money and these changes to happen - without it the state will be around $7 billion short for the two year period.

Oklahoma: $600 million in the hole, its first shortfall in six years. Looking at cuts and "efficiencies" in state agencies, such as reducing travel expenses. Also will tap state reserves.

Oregon: The state is coming to the end of its two-year budget cycle and is around $1 billion short. Last November, state agencies were asked to present a 5% cut across the board to lawmakers. The debate is on about what to cut in the remaining months, with a new budget that now looks to be up to $2 billion short due this July 1st.

Pennsylvania: Sneaky Ed is looking down the barrel of a $2.3 billion dollar deficit, and will cut up to 2600 state jobs and makes cuts to hundreds of state programs. They will eliminate the Scranton State School for the Deaf, as well as cuts to tourism and public broadcasting. "In the FY2010 Budget, we cut or eliminated funding across 89% of the line items in the budget". Rendell wants to legalize video poker gambling and raise taxes on such things as tobacco products and natural gas drilling, as well as tap the state's rainy day fund.

Rhode Island: Tiny Rhode Island needs to cut another $350 million, and this comes after they slashed services and laid off employees to fill a $425 million dollar hole. "The state cut in half community service grants that assist the elderly, the youth and the poor; tightened the requirements for health coverage for low-income parents, and reduced funding for public colleges by $19.5 million, forcing them to hike tuition by as much as 10% for the fall semester and even more for the spring. Rhode Island is second in the nation's unemployment rate behind us.

South Carolina: Gov. Mark Sanford is a tool. He doesn't want any stimulus money, but the state has already cut $1 billion, is looking to cut $500 million more, has gone after health care and education in a big way, and its unemployment fund is broke, amongst other horror stories. One story was about a baby that was missing half its brain, and can't die at home because the state has cut Medicaid hospice. The Greenville News and education officials are begging the state to accept any stimulus money that comes its way.

Tennessee: $1 billion short will equate to a 20% cuts across the board, with projected layoffs of state employees and tuition increases at universities. They had already slashed in Medicaid funding in 2005, throwing 170,000 people off the rolls and reducing benefits to others, and now Tennessee worries that any stimulus money coming might make them spend it on health care. They want the stimulus money though - Bresesen will delay the budget until March based on getting it. The state also looks to tap its rainy day funds.

Texas: Texas officials have asked state agencies to present a 2.5% cut in spending to cover what is projected to be a $500 million dollar deficit. Texas also has $6.7 billion in its rainy day fund, but requires a 2/3rds vote to spend it. Texas unemployment offices are seeing floods of applicants, and residents are asked to go online as they have been here. Yet another state that is against the stimulus, but quietly talks about how they will spend their share.

Utah: Thousands of state jobs will be slashed, and spending will be cut 7% across the board as Utah looks to make up a $1 billion deficit. Closing courthouses, reduced enforcment in food safety, cuts to senior meals, substance abuse treatment, services to families with autistic children, closing state parks a few days a week, and layoffs in education are in the works.

Vermont: Residents are literally taking to the streets to protest Gov. Douglas' "draconian cuts" of $68 million to the state budget that have hit the poor and higher education the hardest. Refusing to raise taxes as some lawmakers have suggested, the state is looking at "living within its means" as revenues plunged steeply in January.

Virginia: $3 billion in the red is a lot of money for this state, and cuts to everyone and everything are coming, including $600 million for K-12, 10-15% cuts to higher education, cuts to state police services, releasing non-violent inmates early, and $418 million to Medicaid, with the biggest hit coming to nursing home admissions and homes for the mentally-impaired.

Washington: In December the state was facing a $5 billion shortfall in its next two year budget, with projections that it might grow to $6. Massive cuts in education are being considered - almost $1 billion to public schools. Higher education may be cut up to 20%, and layoffs and pay freezes for teachers and state employees are possible. They are also looking at cutting health care for children and the elderly.

West Virginia: WV currently doesn't have a budget issue, but rumors of cuts to higher education are floating. The new budget won't cut spending, but Gov. Manchin is looking to increase state efficiency by 4% in anticipation of decreased revenues. They also are looking at "increasing fees" on various items.

Wisconsin: $5.7 billion short for its next two year budget cycle. A budget fight is in the works, and with massive cuts to education and healthcare looming, Democrats are quietly talking about raising taxes. They are counting on that stimulus money to get them through, but worry about what happens when it's gone.

Wyoming: With all of 514,000 residents or so (about half the size of the metropolitioan Grand Rapids area), Wyoming looks to be OK for now, although there was one report where community colleges may be facing a slight cut in funding.