This recession has been what one expert called "shock and awe for state governments." States are facing budget gaps many have never seen before.
In the coming year, 31 states and Puerto Rico face budget shortfalls totaling more than $82 billion! And now new Census data is out showing just went wrong across the country.
For one: total revenue was down a half a trillion dollars in 2009, that's the biggest drop ever. Pension funds were a major reason for the plunge! The data shows a $477 billion decline as states try to plug holes in the failed system.
Other problems? Tax collections fell by $66 billion, but as we've told you before collections are on the rise in many states for 2011.
Despite federal help for the jobless, state spending on unemployment benefits nearly doubled from 2008 to 2009. And welfare also got a boost from state governments, up more than 6% year-over-year.
The Recovery Act - or "the stimulus" did provide states with a lot of help. However, once the summer hits, states can say goodbye to the aid - most likely for good! As of June 30, the Feds will have doled out $165 billion to capitals across the nation.
This means many programs will likely get the ax in the coming months and governors shouldn't expect a re-up in stimulus money now that the Republicans control the house.
Indiana Congressman Mike Pence says: "we've got to put our fiscal house in order in Washington D.C... it's going to be essential that leaders at the state level roll their sleeves up, make the hard choices and put their fiscal health in order, as well."
But here's the problem: Thanks to this administration, and others before it, states have become addicted to federal aid. No matter how much they get they want more and more.
But Congressman Pence is right - now's the time for governors to stand up and take responsibility for their own situations and do something to fix it without more taxpayer help.