US states’ budget crisis sets stage for

new attack on the working class
by Tom Eley

By Tuesday, many US state governments must pass budgets for the coming fiscal year. The state capitals are now the scene of bitter feuding among governors and legislators over how the deficits will be met. But there is unanimity that the working class must foot the bill.
Forty-six states confront significant deficits, and their collective shortfall for 2010 stands at more than $130 billion. This comes after a $104 billion deficit in 2009, for a two-year total of $234 billion in red ink—$91 billion more than President Barack Obama’s stimulus package allocated to all municipalities and the 50 states for the next two years.
At its heart, the state budget crises are driven by the recession and the impoverishment of the working class. Layoffs and wage cuts are rapidly diminishing returns on state and local taxation—income, sales, and property taxes. At the same time, increasing numbers of unemployed workers and their families are turning to state-administered social safety programs already woefully unprepared for hard times.
Now, as the fiscal year approaches its June 30 end, the budget crisis is being used by Democratic and Republican governors alike to launch a new attack in the social position of the working class. This will be carried out through cuts to social programs, education, and transportation; layoffs and wage and benefit cuts for state workers; and regressive forms of taxation targeting the spending and income of working class households. ( learn more at )

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Hotel owners are facing the same problems as homeowners, being upside down on their properties with no good escape. Please consider Hotel foreclosures jump in California. ( learn more at )

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Prices excluding fresh food slid 1.1 percent from a year earlier after dropping 0.1 percent in the preceding two months, the statistics bureau said today in Tokyo. It was the sharpest decrease since comparable figures were first compiled in 1971. (http://globaleconomicanalysis.blogspot.com/)