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July 21, 2009
Posted: 06:00 PM ET
FROM CNN's Jack Cafferty: Almost every state in the nation is hurting financially. More unemployed people along with cuts in consumer spending mean states are collecting a lot less in taxes - and that means bigger and bigger budget shortfalls.
Protesters demonstrate against cuts to social services that aid people with disabilities and the poor at the home of California Gov. Arnold Schwarzenegger. The Financial Times reports one estimate shows tax collections dropped by almost 12 percent during the first quarter of this year... with 45 of 50 states reporting declines. Early numbers for April and May are even worse - showing declines in tax revenue of almost 20 percent. Some are also questioning how effective the federal stimulus package has been - if states are spending billions of these stimulus dollars and still can't close budget shortfalls. There are only two choices when it comes to this: either raise taxes or cut expenses. Many states have made cuts to school districts, health care, programs for the disabled, the prison system and state employees... California has even been issuing IOUs for things like welfare checks. The bad news is this may not be a temporary situation. These cuts to state budgets may be the new reality going forward... Almost two-thirds of states are projecting budget gaps for 2011... and at least 15 states already foresee gaps as far out as 2012 - when the federal stimulus money will have dried up. Here’s my question to you: What government services are you willing to see reduced or eliminated? Interested to know which ones made it on air?
Ira writes: Remo in Pflugerville, Texas writes: Karen writes: Carl in Aurora, Illinois writes: AC writes: Robert writes: J. writes: Nuria writes: Filed under: Economy Government
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Jack Cafferty sounds off hourly on the Situation Room on the stories crossing his radar. Now, you can check in with Jack online to see what he's thinking and weigh in with your own comments online and on TV. Send your comments on the "Cafferty File". Jack's Book
Read excerpts about Jack's battle with alcoholism and Jack's philosophy on parenting. CNN=Politics Screensaver
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