Bartlett: States Face Budget Shortfalls

At his new column at the Fiscal Times, Bruce Bartlett explores how the budgets of the states are under extreme pressure:

On Saturday, President Obama asked Congress to extend federal aid to the states. Because their fiscal years run from July 1 to June 30 (the federal fiscal year runs from October 1 to September 30), the imminent expiration of temporary federal aid could lead to a sharp cutback in state spending that would hamper the economic recovery.

A June 3 report from the National Governors Association and the National Association of State Budget Officers shows that the states have cut aggregate spending by $74.4 billion, or 10.8 percent, since 2008. The expiration of $55 billion in temporary federal aid to the states could lead to further substantial spending cuts beginning on July 1.

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