We`re going to see many states across the country specifically california dealing with rosy predictions and forecasts brought by the govt. They said the economy was going to rise to 8.0 % unemployment if they passed the stimulus, but we see that even by the govt`phony standards, this rate rose to 9.6% . Of course, budgets across the country are going bust and states are seeing deficits rising even higher than they predicted. Nearly two thirds of US states are projecting budget gaps in the next couple of years.
The study, conducted by the Pew Center on the States, found the following US states to be the most bankrupt:
- New Jersey
- Rhode Island
“Doomsday is here for the state of Illinois,” said Laurence Msall, Civic Federation President, to the Sun-Times.
In order to crawl from beneath crushing debt and reach fiscal solvency, Illinois legislators must choose from a series of options that range from bad to worse, according to a prominent watchdog group.
The Civic Federation wants to launch an intervention that includes significant budget cuts and the largest tax increase package in Illinois history, all in an effort to save the state from a $12.8 billion budget deficit.
The group says it would support a state income tax increase from 3 percent to 5 percent. It also recommends the state tax retirees’ pension and Social Security checks be taxed for the first time at the same rate as workers’ paychecks. They want another $1 increase on a pack of cigarettes and to eliminate $181 million in corporate tax breaks. Source: NBC News Chicago
When the people who work for government benefit more from the State then the people who live under it, that is tyranny. New York State is failing because it is the most corrupt State in the nation. We are losing population because voting with your feet is more meaningful than voting at the ballot box. The unions control government and will do to NYS what they did to GM, and for the same reasons. Our politicians are gutless, do what they need only to get re-elected, and have no concern for the greater good.
Since the Governor took office in California he has faced huge budget deficits. He has had mounting debt issues, and continued to borrow money or used prior year resources.
Causes: 2/3 shortfall comes from Corporate income taxes, a huge problem; erroneous financial assumptions; huge housing downturn; reduced property taxes; world wide recession; unemployment rate 6.2 %; and Long Term unfunded debt 65-95 billion and growing.
The California deficit is the third largest in the United States. The State is bloated with public servant and had recently been on a been on a hiring spree (2007-2008). Unfortunately the layoffs do not target the meat on the bone, and there financial woes will not go away anytime soon.
They’ll be back at the trough next month with yet more deficits. The assumptions they are using for tax receipts are preposterous. These people are incapable of thinking ahead more than 90 days.
They all stand there smiling like they have actually accomplished something. It’s pathetic. Republican “spend without regard to debt, because debt doesn’t matter” ideology is driving this state into the ground.
And Democrats are not doing any better. They want to “preserve the safety net.” The lavish and extensive safety net is what got them into these problems in the first place. You cannot reward laziness. People have said that for decades, but nobody believed them because it never seemed to matter. Now it matters and they are so blind to the fact that it is the root cause of their problems that no actual solution is logically possible.
Illinois is destined to become the new California of the US. They might even surpass southern Texas for that mantle.
MTA Announces Layoffs of 1000 Workers
By Erika Tarantal and Hasani Gittens NBCNewYork.com
The MTA’s slogan is “Going Your Way,” but for employees of the agency, that “way” could be to the unemployment line.
In an effort to clamp down budget deficits, the Metropolitan Transportation Authority announced today that it will lay off more than 1,000 positions.
In a press release the agency said they would begin “with the elimination of more than 600 represented and non represented administrative position.. [and] begin the process of laying off up to 500 NYC Transit station agents.” Source: MSNBC
SF School Board Approves Massive Layoffs
San Francisco school officials have voted to layoff nearly 900 teachers and administrators, and this time Superintendent Carlos Garcia says at least some of them will eventually be let go. The school board approved the layoff notices. Source: kgoam880
ABC News plans 25% cutback
Reporting from New York – Bowing to economic pressures, ABC News is launching a top-to-bottom restructuring that will shrink the staff by as much as 25% and dramatically reorient the way it gathers and produces the news. ABC News President. Source: LA Times
Saks posts smaller loss in 4Q on less discounting
NEW YORK (AP) – Luxury retailer Saks Inc … The 2009 fourth quarter included several one-time items that weighed down profit by US$14.8 million, or 9 cents per share, related to asset impairments and a pension charged related to layoffs. Source: MSN Money
It appears from evidence that 2010 promises to be a year when the sovereign credit risks remain at the forefront of the public sector as they experience lower revenue while US states continue their largely unsuccessful efforts to revive their moribund economies. As with American states, each sovereign mess is characterized by a mixture terrible fiscal policies that are ultimately resolved through higher borrowing to the point where new debt must be reduced, the depth and the madness of the mess becomes obvious.
Financial autopsies will continue across the USA to reveal bloated government budgets filled with unionized workers, excessive wages, excessive pension, and unchecked public services that need structural reforms.