Waves of job losses sap U.S. states' budgets

[undeterred]

Source: Reuters

WASHINGTON (Reuters) - Already sapped by a long U.S. recession, states' budgets will likely shrivel even more as waves of Americans lose their jobs, and the damage done to public services such as education could last for years.

Looking at the U.S. unemployment rate, which stands at 9.5 percent and is projected to rise above 10 percent, National Governors Association Executive Director Raymond Scheppach said states' economic conditions are going to "get worse in about 10 months, and it'll stay bad for a while."

During any recession, problems caused by job declines appear in states' budgets late in the downturn and are hard to eliminate. Unemployment injures the budgets so badly that economists use jobless rates instead of production and growth to measure the depth of states' recessions.

"People become unemployed and they first look around for another job for a while and only after a number of months of not getting a job ... try to get on the Medicaid rolls," Scheppach said, adding that the healthcare program for the poor, which is jointly administered by states and the federal government, makes up 22 percent of the average state budget. That pushes the amounts states spend on the program up just as their income tax receipts drop.



Read more: https://commerce.us.reuters.com/profile/pages/newsletter/begin.do

[aquart]

1. But we don't need no steenkeen jobs program.

WPA? CCC? Not for us this time around.

[4dsc]

2. Conservative economics is circling the drain folk

We need to continue to remind the American public that what we are witnessing is the end game of conservative economic policies that have spanned the last 30 years. Its going to take a miracle to fix this problem and I don't think its going to happen soon.

IMHO, we are in a depression but they are afraid to say it in DC..

[ananda]

6. If Obama was smart, he'd replace his whole economic team.

And replace with them with economists who know what to do:
Stiglitz, Reich, Galbraith, etc.

[cascadiance]

7. And perhaps get someone like Ravi Batra in the mix too...

He's been warning us about this mess for quite some time already!

[corpseratemedia]

3. public option, public works, public good, public financing of elections

these phrases need to become acceptable again to our country and to our lobbyist-loving reps if things are to get better

we are indeed in the death spiral of reaganism - it collapsed the country

[Mari333]

4. just read its over 10 percent in my small town

the roads are buckling, the jobs dont exist, and the utility rates just went up 29 percent.

[undeterred]

5. Wisconsin put the stimulus into the annual budget

and the result is that the cuts are less drastic. Instead of dealing with a 5B deficit its now just over half that. There will be 2% cuts to state agencies instead of 10 or 15% cuts. Of course thats great, but it doesn't improve life for people without jobs. At least not in the near term.

[Odin2005]

8. This is what happens when right-wing Keynes-hating idiots run things.

[bemildred]

9. Gee, who could have predicted this?

Too bad the Fed can't pull jobs out of its ass like it does money.

[Sirveri]

14. Fed pulled jobs out of its ass during the depression.

Public works employs large numbers of people and pays them a decent wage.

That a big problem for those who want a race to the bottom though.

[bemildred]

15. That was not the Fed.

I meant "The Fed", not the Federal Government. I think we are on the same page actually. If you let yourself think about it, for example, a federal health care program could create a boatload of jobs, so could a national public works repair and maintenance program, so could a return to a real publicly financed education for anyone that wants it program. There is lots of work that needs to be done.

[DollyM]

10. life is hell in Illinois because of the economic mess . . .

We lost jobs nearly a year ago and can't even get interviews anymore. (We have Master's degrees too.) Front page news today is local layoffs in social service programs, four at a local children's home, eliminating the pregnant and parenting teen program, job cuts at a home for developentally disabled adults, and major cuts at a prison. All jobs lost for an area that already has an unemployment rate at over 12 percent. In a small area like ours, this is an absolute disaster. Our governor wants to raise taxes which didnt fly so he is cutting social services instead. We applied for food stamps and medical cards two months ago and have never heard back a word. Times are incredibly rough, it is enough to make a person just hang it up.

[KamaAina]

11. See, if we had single-payer, that pesky Medicaid thing wouldn't be a problem

sighhhhhh....

[NeoConsSuck]

12. Whatever we do...

let us not upset the capitalists by trying to limit H1B visas or outsourcing. Until our federal government looks at those two issues, it's all just politicans blowing smoke up our asses.

[nc4bo]

13. Budget crunch? Just do what our new gov. is fixin' to do in NC

A "temporary" 1% sales tax increase (among other things). I'm surprised she doesn't want to raise the food tax - since we all gotta eat and all.

http://abclocal.go.com/wtvd/story?section=news/local&id=6903658

That's going over really well across all party lines.

Coming in behind Liddy Dole, I'd think that Purdue would be going through EVERYTHING having to do with NC's finances/budget with the nit comb.