May 5th, 2010
08:46 AM ET
5 years ago

Goodbye, stimulus. Hello, state budget cuts

New York (CNNMoney.com) - Think states have made deep spending cuts? You ain't seen nothing yet.

States have been struggling with huge budget gaps since 2008, but this year could be worse as federal stimulus funds wind down.

Until now, stimulus money spared governors and state lawmakers from making some of the most brutal budget cuts. But with this lifeline running out, officials are looking at making significant cutbacks to public services, particularly schools and health programs.

"The stimulus funds have staved off what could have been even deeper cuts," said Todd Haggerty, policy associate at the National Conference of State Legislatures. "You're seeing states now are coming to that point where they will have to make additional cuts or find new sources of revenue for fiscal 2011 and that will continue in fiscal 2012."

Full story on CNNMoney.com


Filed under: economic stimulus
soundoff (29 Responses)
  1. Michael

    Time to rescind those godawful tax cuts for the uber-rich! Time for corporations and fatcat investors to start taking some responsibility for the community upon whose labor-bent backs they rose to fortune.
    If only in the name of self-interest: why crush the back that works for you?

    May 5, 2010 09:01 am at 9:01 am |
  2. Claudia, Houston, Tx

    It's time for state governors to do their job and stop passing the buck and then complaining about too much federal government. They've had more than enough time to become innovative instead of just playing golf and living high in the governor's mansion and doing nothing.

    May 5, 2010 09:06 am at 9:06 am |
  3. Good

    Yell, budget cuts. These are the same people who are complaining about how much debt we are leaving our children, but yet the first thing they want to cut is education. What chance do the children have without education?

    May 5, 2010 09:09 am at 9:09 am |
  4. Nurse

    This how stimulus wors ....It doesn't. Thanks for nothing Obama.

    May 5, 2010 09:09 am at 9:09 am |
  5. Steve (the real one)

    Say what you will about Mark Sandford and others like him. He did not want stimulus money because he know it would be but a temporary crutch. Guess what! the Stimulus will eventually run out and then what, deep budget cuts! These massive budget cuts will affect EVERTONE, to include lower income families! Schools are being closed, services are being cut back! The stimulous was just a bandage

    May 5, 2010 09:10 am at 9:10 am |
  6. Chessnutz of Liverpool NY

    What a house of cards our stimulus policy is. This nation's debt has been exasperated to the point that it is unsustainable. We the middle class have been lied to again and again. Wall Street kept their bonuses and Main Street pays for them with skyrocketing local and state taxes.
    This is why Big government doesn't work folks! Governments can not take care of the people. Only the people can take care of the people.

    Vote Congress out, “you are fired” if they are in. Vote them out this fall no matter what party they belong to, and in the next election and every election going forward until they become the servants of the people once more.
    This November tell Congress "You Are Fired!"

    May 5, 2010 09:14 am at 9:14 am |
  7. Anonymous

    Yeah, The red states will complain that Obama is not giving them enough help. Thats my word!!

    May 5, 2010 09:23 am at 9:23 am |
  8. Fair is Fair

    Go figure. Everyone knows that porkulus was nothing more than political payback and an effort to dramatically expand nanny government.

    Let each state do what it needs to do to keep themselves solvent. And don't give me that "cut schools and health programs" junk. Try cutting the state level hack-a-rama jobs FIRST. Besides, the lions share of school funding comes from LOCAL revenue sources – same with public safety.

    Don't like the state you live in? Move. People do it every day.

    May 5, 2010 09:28 am at 9:28 am |
  9. KM

    Why is it that education is always the first thing to get cut? Why not look at some of the "nice to have" public services and decide which of those could be cut first.

    May 5, 2010 09:31 am at 9:31 am |
  10. Willy Brown

    So how's that hopey changey thing workin for ya?

    May 5, 2010 09:33 am at 9:33 am |
  11. Wil in the VA.

    Well i guess we will see just how many jobs where saved by the stimulis last year by the amount of jobs lost this year .

    May 5, 2010 09:39 am at 9:39 am |
  12. Hugo

    About time, the Stimu-less in Florida has done nothing but keep the bevy of commerce killing bureaucrats in State jobs with higher than private sector paychecks, unbelievable benefits and guaranteed 4% cost of living increases while the taxpayers in the private sector that actually fund the entirety have continued to slide to a 12.7% unemployment rate, lost benefits, homes, and life savings while their families do without for the last two years. Great job President Obama and Governor Crist, birds of feather!

    May 5, 2010 09:44 am at 9:44 am |
  13. Randall in Torrance, CA - The Republican's Legacy

    This fiscal wreck is the Republican's legacy. Under the hands-off policy of Jarge Bahoosh the economy went down the toilet. Never again!

    Obama-Biden 2012!

    May 5, 2010 09:54 am at 9:54 am |
  14. VAVoter

    WHY, WHY, WHY do we always cut funding for schools? This is dispicable. Are our children not worth the money that we are investing in their education? Can't you cut some salaries of government workers, kickbacks to corporations or R & D funds? Why is it always the children? Its like we don't value our future.

    May 5, 2010 09:58 am at 9:58 am |
  15. Anonymous

    What the stimulus should have done was give them time to properly prepare for additional cuts and reorganization.
    Instead, most used it it as a stop gap and did nothing and now must pay the price.
    Most city, county and state governments could easily shave money from thier budgets had they taken the time allowed them. Instead they will rush through, half thought pans that will end up hurting people and their area.

    May 5, 2010 09:59 am at 9:59 am |
  16. Washington DC Insider

    Does anyone find it mildly ironic that we can spend, spend on a Federal level...but now we have to cut back the stimulus money for the states? I guess that means we'll see less State-level services trickling down.

    Good thing we have the Federal Government to take care of us, just don't mind the deficit that is slowly growing and growing.

    May 5, 2010 10:02 am at 10:02 am |
  17. Dutch/Bad Newz, VA

    Simply said, if the stimulus was never enacted, states would be in a worst situation that what they're in now. Just think of all those police, fireman and teachers that would've had to be layed off.

    May 5, 2010 10:08 am at 10:08 am |
  18. MARKPAIN

    If we had jobs we would not have this problem. When are the leaders of the states going to realize this goes back to the eighties when the federal government decided that manual labor jobs were beneath the U.S. citizens and let those jobs begin to go around the world? Free trade was a mistake and the result is no jobs = no revenue for business` or taxes for the government

    May 5, 2010 10:18 am at 10:18 am |
  19. Luke Brown

    The reason these budget shortfalls are so deep is that the states - led mostly by Republicans - have given one tax cut after another to businesses and wealthy individuals.

    They gave away their state's tax base, and looked no farther than the next election at the implications of what they had done.

    Listen up America ... Republicans know very well how to win elections. Republicans do NOT know how to govern.

    Ironically, Federal stimulus money has allowed a cover up of Republican fiscal mismanagement at the state level.

    May 5, 2010 10:27 am at 10:27 am |
  20. NVa Native

    As the "red states" are the biggest federal welfare states this will be good to see them cry and moan about budget cuts. They never gave the President any credit when his stimulis bailed them out since '08. Let's watch as the hypocrites blame our President for them not being able to educate their children ... wait they already choose to keep their kids ignorrant so it's easier for Fox media to mold their brains into followers of lies and deception.

    May 5, 2010 10:31 am at 10:31 am |
  21. rachel

    Shocking I tell you. I am sure the Healthcare bill will help with the state's budgets. I also beleive that the president of Iran holds no ill will for the people of Israel.

    May 5, 2010 10:32 am at 10:32 am |
  22. Capt. Snarky

    Try cutting aid to illegal immigrants for a start. Both on the State and Federal level. Shut off the tap, and the keg party will wind down pretty quickly, and go home.

    That would save billions..........................

    May 5, 2010 10:35 am at 10:35 am |
  23. David

    Cutting funding for schools almost guarantees we will become a third world nation over the next few decades. We need to raise taxes too. People need to realize we do get something for our tax dollars. Cutting alone is not the answer.

    May 5, 2010 10:41 am at 10:41 am |
  24. Liz the First

    The states are in such dire financial straits not only because of the recession, but because of the poisonous anti-tax mania among people on the 'right.' how do they think states can function with no revenue? they are always screaming about 'tax and spend.' well, duh! that is the function of government. government is us! it's people we hire to manage the things we can't manage individually, and we contribute a portion of our wages to enable these people to take care of these necessities for us. when we reneg on our end of that arrangement, everyone in the state suffers. and the people who scream about not wanting to pay any more taxes scream just as loud when something important to them is cut. there's no free lunch, folks. and stop listening to the idiots who scream, 'it's your money!' if it's the portion that should go to the state or the country, it's NOT your money. arguing against taxes is arguing for anarchy!

    May 5, 2010 10:44 am at 10:44 am |
  25. Naqib

    Doesn't surprise me... the mass federal spending helped support the fall up to this point. It's now running out and we will see things simply get worse. No money... lack of income due to job loss... (less paying taxes)... those that are paying will see massive increases in state taxes to pay for the massive increase in federal spending. We have a tough roe to hoe at this point with no end in site. We will have to address and change the recent bills because they aren't affordable... We are going to go through a massive decrease in service... with an increase in cost... leading to a much worse situation for the middle class and poor... because they always feel it more. The change is coming and that's a fiscal fact... just hope it's the change so many believed in.

    May 5, 2010 10:49 am at 10:49 am |
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