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NC not the only state counting on more federal relief

Post on June 2, 2010 by Rob Schofield 7 Comments »

The new half-billion dollar hole confronting North Carolina budget writers as a result of congressional wimpiness in renewing federal economic recovery spending is far from one-of-a-kind. According to a survey conducted in April by the National Conference of State Legislatures, 30 states (including North Carolina) reported that their budgets, either proposed or already enacted, assumed congressional approval of a six-month extension of enhanced Federal Medical Assistance percentages (FMAP). That list included a number of states led by Republican (or quasi-Republican) guvs, including Alabama, Alaska, California, Florida, Georgia, Hawaii, Idaho, Minnesota, New Jersey, Rhode Island, South Carolina, South Dakota, Texas, Utah, and Vermont.

Of course, there have been a lot of changes in the past month. Minnesota’s governor and presidential wannabe Tim Pawlenty (pictured above) assumed the FMAP extension would be there in his proposed budget, but was forced to back off when the final deal was struck a couple of weeks ago. Other states with earlier legislative sessions than North Carolina have also been reading the handwriting on the wall.

Still, the bottom line in the current situation is this: congressional conservatives of both parties are causing a lot of unnecessary harm to the citizens of their states – harm that responsible many politicians of both parties had tried (and budgeted) to avoid. Shame on them for potentially short-circuiting the recovery.

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Comments (Closed):7

WILLIAM MURRAT
June 2, 2010 at 4:42 pm
It seems fairly obvious to everyone but you that there is essentially no recovery going on when it comes to jobs. The stimulus spending has been an abysmal failure in job creation, and once the funds give out, all that we will be left is more debt. Government on many levels is simply broke, and states will need to learn how to live within their means as painful as it may be.
Rob Schofield
June 2, 2010 at 5:03 pm
No, actually what seems obvious to a lot of very smart people is that:
a) Despite being a half-measure, the stimulus helped avert utter economic collapse,If we’d done more we’d be a lot better off.
b) Leaders of both parties have been trumpeting its accomplishments and celebrating the jobs and infrastructure it has created.
c) Job growth IS on the rise.
d) The new debt resulting from the Recovery Act is a tiny fraction of the overall long-term budget problem.
d) It is a huge mistake to back off now and sink back into the defeatist, do-nothing swamp of the neo-Hooverites.
NCDude
June 3, 2010 at 7:54 am
It’s not Conservatives! Both the NC Legislature and the US Congress have kicked the can down the road to avoid making the tough spending decisions before elections.

For crying out loud, the last time I checked, Liberal Democrats have control of both houses of Congress and the Administration. Has the Progressive Pulse no shame? Oh, wait…
NCDude
June 3, 2010 at 8:07 am
Rob, we’re on the bleeding edge of a vertical deficit spending curve, which began at the end of WWII, and we can’t spend our way out.

If I were you, I would realize housing prices are going to tank because of all the foreclosures, banks will start failing, and the only thing propping up our economy is the dollar and the ability to defend it by force.

The GI Bill was the first government giveaway program financed by debt, and it will be generations before we recover from the Gazillion dollar debt run up since the end of WWII, and it will be worse than the Great Depression.

We could have headed off the health care crisis in the 60′s, but instead enacted Medicare, effectively hiding the real cost of health care in the national debt.

In the 60′s, we paid people to have babies, and they had babies. Today, we pay them not to work, and they don’t work.

I give up trying to figure you liberals out, I just want to know where it ends. Out of control federal spending is going to stop it, one way or the other.
WILLIAM MURRAT
June 3, 2010 at 8:22 am
Rob is a true Progressive which by my definition is someone who pushes their own cause, and then uses someone else’s money to pay for it. Well, guess what Rob- the money has run out ! His liberal Democrat friends ran California for 30 years with this same thinking, and look at it now- an unmitigated disaster !
Rob Schofield
June 3, 2010 at 12:33 pm
Uh, guys, you might want to do a little more research. U.S. debt is well under where it was after WWII. Stimulus spending is a relatively tiny contributor. Deficits have ebbed and flowed through the years with the economy and have most typically skyrocketed when lunkheaded trickledown policies (see Reagan and Bush II) are implemented.

Moreover, it was just a decade ago (before the disastrous Bush tax cuts on the wealthy) that the country was running big surpluses and seriously contemplating the prospect of paying off the debt.
NCDude
June 4, 2010 at 10:53 am
So, 287 Billion dollars in projected state’s budgets gaps over the next 3 years, almost all of which has to be balanced, compared to 2.4 Trillion in federal deficit spending isn’t an indicator of out of control federal spending?

The problem isn’t spending by the states, the problem is federal spending, and balancing state’s budgets with federal deficit dollars.

I have no problem with public sector spending, only when it’s borrowed $$. The public sector has to downsize, the same as corporate america has done decade after decade. With boomers about to retire, and any number of social ticking time bombs out there, the only thing getting our economy rolling is going to be to cut taxes and federal spending.