Recession and State Budgets

Recession-bruised states’ revenue sank 30 percent in 2009, Census Bureau reports, By Michael A. Fletcher, January 5, 2011, Washington Post: “The recession blew a huge hole in the already shaky finances of state governments, causing them to lose nearly one-third of their revenue in 2009, according to a Census Bureau report released Wednesday. The severe drop in revenue resulted largely from the big investment losses experienced by state pension funds during the worst period of the downturn. Also, the report said, tax revenue slipped while surging demand from newly needy citizens drained the funds that back unemployment benefits, publicly funded health care and workers’ compensation. Overall, total state government revenue dropped 30.8 percent, to $1.1 trillion, between fiscal 2008 and 2009, according to the report…”