State Woes Worsen

No one’s been following the budget crunch facing states more closely than the Center on Budget and Policy Priorities, and today they’ve released more bad news: In the middle of the economic downturn, 43 states are facing funding shortfalls in 2009 and/or 2010.

Because most states are legally required to balance their budgets each year (ie, they can’t borrow their way through a recession like Washington can), the holes can be plugged only a handful of ways: By reducing spending through program cuts and employee firings; increasing revenues with tax hikes; tapping into rainy-day funds; or calling on the federal government for a cash infusion.

President-elect Barack Obama has vowed to make help for states the first priority of his White House tenure. For the nation’s governors, Jan. 20 can’t come quickly enough.