Economic Stimulus and State Budgets

Goodbye, stimulus. Hello, state budget cuts, By Tami Luhby, May 5, 2010, 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…”
Budget cuts hang in balance, By Yvonne Wenger, May 7, 2010, Charleston Post and Courier: “South Carolina legislators have banked on Congress sending about $200 million more to help pay for health and human service programs, but the money might not come through. The House and Senate versions of the $5 billion state budget depend on Congress extending increased Medicaid assistance, first approved as part of the federal stimulus package. Earlier this year the cash looked like a sure bet, and the U.S. House and Senate approved it at one point, but it’s not a done deal. If the money does not come to the state, programs and services will be cut by about $200 million. This dilemma is a preview of what the state will face when all the federal stimulus cash is gone…”