The Stimulus Set The States Up For An Even Bigger Mess This Year

Remember how $200 billion in federal stimulus cash was supposed to save the states from fiscal calamity? Well, hold on to your paychecks, because a big story of 2010 will be how all that free money has set the states up for an even bigger mess this year and into the future.

First, in most state capitals the stimulus enticed state lawmakers to spend on new programs rather than adjusting to lean times. They added health and welfare benefits and child care programs. Now they have to pay for those additions with their own state’s money.

For example, the stimulus offered $80 billion for Medicaid to cover health-care costs for unemployed workers and single workers without kids. But in 2011 most of that extra federal Medicaid money vanishes. Then states will have one million more people on Medicaid with no money to pay for it.

This is the opposite of what the White House and Congress claimed when they said the stimulus funds would prevent economically harmful state tax increases. In 2009, 10 states raised income or sales taxes, and another 15 introduced new fees on everything from beer to cellphone ringers to hunting and fishing. The states pocketed the federal money and raised taxes anyway. SOURCE

The government and the State leaders were told that this would happen and now they will feel it as well as see how wrong it was to spend so much tax money. The democrats and Obama has been told time and again that you can’t spend the country out of a recession. Another bad decision by the weak Jimmy Carter like president, yes you Barack Obama!


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4 comments on “The Stimulus Set The States Up For An Even Bigger Mess This Year

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  3. I think California slides into the ocean this fiscal year, and the U.S. will be left with 49 states. They blew the money and have no credit.

  4. From what I understand is that all the states has spent the stimulus money, the jobs are finished and they will start laying off the workers. In my neck of the world I have not seen one job created with the stimulus money, maybe a few jobs inside the large cities in the northern part of North Carolina. Our roads still has those big pot holes and parts of the pavement is cracked and missing making it dangerous to drive on.

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