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alstry (35.17)

If you cut enough you DIE!!!

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July 23, 2009 – Comments (6)

The bad news about state budgets just keeps getting worse. Only three weeks into the new fiscal year, gaps are already opening up. And the shortfalls are only expected to grow.

"If you think legislators are breathing a sigh of relief because their budgets are passed, think again," said William Pound, executive director of the National Conference of State Legislatures.

State legislators and governors had to contend with deficits totaling $142.6 billion as they closed out fiscal 2009, which ended on June 30 for 46 states, according to the conference. Three states have yet to pass balanced budgets for fiscal 2010, as officials tussle over painful budget cuts and tax increases.

 

An Arizona official joked that the state's financial plight is comparable to the Grand Canyon, while an Illinois legislator said his state's budget situation is so scary, it's best told around a campfire at night.

"The revenue forecasts are continuing to underperform even the most pessimistic of projections," Eckl said. "There's still a lot of this ahead of us."

At least 12 states and the District of Columbia are confronting gaps totaling $23 billion in budgets already adopted.......

http://finance.yahoo.com/news/Budget-gaps-that-just-wont-cnnm-20000940.html?x=0&sec=topStories&pos=8&asset=&ccode=

There is a point where the evaporation of revenues exceeds ability to cut.  Not much different than dealing with a patient presenting with an uncontrollable sepis.  First you cut off the patients legs, than arms, than organs, and there is simply nothing left to cut without killing the stump of a patient as the infection keeps spreading.

If economists were doctors, the world would be dead on the operating table.  How could this "exceed" the most pessimistic estimates.  Alstrynomics has been blogging about the problem ad naseum for the past year and a half.  Soon it will be time to restructure, the only question now is how will it be imposed upon us.

When you don't have enough money to eat, health care reform is meaningless.

6 Comments – Post Your Own

#1) On July 23, 2009 at 2:43 PM, EcoFreako (< 20) wrote:

Here's what happens with the infection:

 http://news.bbc.co.uk/2/hi/americas/7849061.stm

Again Alstry, I ask, what do you propose?  Do you have any thoughts?

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#2) On July 23, 2009 at 5:50 PM, alstry (35.17) wrote:

Either cut or tax or both......when there is no money all are Zombulated.

 

Water rates could soar 28.5% in Milwaukee, and even higher in the suburbs, under a plan backed Thursday by a Common Council committee.

If the full council agrees Tuesday, the city would ask the state Public Service Commission to authorize raising the water bill for the average Milwaukee homeowner from $156 to $200 a year, Water Works Superintendent Carrie Lewis told the council's Public Works Committee.

Rates would rise by the same percentage for water customers in Greenfield, Hales Corners, St. Francis, West Milwaukee and part of Franklin, Lewis said. The city would also raise the wholesale rates it charges to the municipalities of Brown Deer, Butler, Greendale, Menomonee Falls, Mequon, New Berlin, Shorewood, Thiensville, Wauwatosa and West Allis and to the County Grounds in Wauwatosa.

Rates for users in the suburbs that buy water wholesale would likely increase more. The city would ask the PSC for a rate of return, or profit margin, of 5% for city residents and suburban retail customers, but 6.5% for suburban wholesale customers, up from less than 1% overall now.

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#3) On July 23, 2009 at 6:23 PM, EcoFreako (< 20) wrote:

Al-

 I found my answers in some of your previous posts...I apologize, I try to keep up with all your posts, got caught up on Tuesday, and missed my answer by this morning. 

Thanks for all the insight.  Energy is going to be big.  There are going to be many changes coming which will drastically change the energy field. 

Eco

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#4) On July 23, 2009 at 7:06 PM, debtRichQuick (< 20) wrote:

This is exactly why I can't understand why we are not showing deflation in the data?

First, it would scar all this Rah-Rah money, into treasuries, and posibly create speculation to the point that a 30yrs fixed is yeilding 2%. LOL

Second it would create competition for state issued bonds, so that states have plenty of power to refi at lower rates and get releveraged.

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#5) On July 23, 2009 at 7:11 PM, debtRichQuick (< 20) wrote:

Forgot to mention it would help "sell" the second stimulus package.

If things were really so good....why would we need a second stimulus package? 

 

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#6) On July 23, 2009 at 7:44 PM, bridgeboy0 (30.66) wrote:

I finally found something we agree upon!!!!

Alstrynomics has been blogging about the problem ad naseum for the past year and a half.

We have definitely reached naseum!

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