[/caption]There was a time when most of the states could thumb their noses at California and Michigan, because they were seen as economic basket cases. But, apparently, there are many states that are suffering from the same economic ailment.
USA Today is reporting that many states and local governments will have to layoff many of their workers due to the lack of revenue, and to close gaping budget gaps.
Mark Zandi, an economist from Moody’s, is predicting that state and local governments will have to lay off up to 400,000 employees due to lack of funding from Washington.
These projected layoffs will aggravate an already bad job situation, because the states will be dealing with the added bad news of their Census employees losing their jobs too.
The bad news for the states seems to be coming from every direction; according to the National Governors Association, money for the states from the stimulus is expected to drop by $55 billion.
In addition, the Senate recently failed to vote in $16 billion for extra Medicaid funding.
USA Today also says that the low hanging fruits have been proverbially eaten, and because the economic down turn has lasted so long, the state and local governments have no choice but to carry out massive layoffs.
With austere measures now in vogue, the states cannot afford to raise taxes, because those who would do so are fearing the lost of their jobs in the coming elections.
It is becoming apparent that it is not only austere measures of not raising taxes and cutting spending alone that will get us out of our economic mess - we will have to raise taxes too, but the voting sentiments out there are such that just broaching the topic is tantamount to political suicide.
Republicans might be salivating thinking of the coming elections and the projected seats they will pick up. But if the projections pan out, the falling sword will be speeding towards them, and the voting public will be looking for a solution.
Alternative for state and city employees:
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