State Fiscal Crises' More News is Bad News

Local news and national papers alike have been replete with the troubling real results of the growing state budget shortfalls. These stories have broken down the astounding figures – $65 billion and $70-$85 billion budget gaps in FY 2003 and FY 2004, respectively – into their real, daily effects on ordinary citizens. By now, Kentucky’s decision to release prisoners before their sentences were up has become the poster-child for desperate states and their drastic budget-balancing measures. In other similar high-profile cost-saving efforts, some school districts in Oregon and Colorado have turned to a 4-day school week; others have stopped buying new textbooks; still others have cut school athletic and marching band programs; in some districts in Oklahoma, the schools have stopped hiring substitute teachers and are, instead, looking to parents to fill in for teachers. According to the International Association of Firefighters, the state and local budget gaps have resulted in layoffs, station closings, and other reductions in staff, even as new Homeland Security Secretary Tom Ridge calls on local contributions for domestic security.

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Fair Taxes for All is Back!

In the face of Bush’s new tax proposal (misleadingly billed as a “growth and jobs plan to strengthen the economy”), the Fair Taxes For All Coalition has been reconvened by People for the American Way, the National Women’s Law Center, the Leadership Conference on Civil Rights, and the American Federation of State, County and Municipal Employees (AFSCME). A petition is being circulated opposing the Bush tax cut proposal:

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The Estate Tax - Reform It, Don't Repeal It!

On January 13, 2003, Responsible Wealth held a press conference on preserving the federal estate tax, which featured William H. Gates, Sr., the co-chair of the Bill and Melinda Gates Foundation, George Soros, chair of Soros Fund Management, Sen. Kent Conrad (D-ND), and Chuck Collins, co-founder of United for a Fair Economy.

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Summary of Chicago Discussion Groups

The following is a summary of themes that arose in discussion groups held in the state of Illinois on September 16 through 18, 2002, around federal budget priorities and how to begin a long-term effort to increase domestic investment. This effort is part of a two-year project, called the Social Investment Initiative (SII). A description of the project is available at www.ombwatch.org/sii/.

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SII November 2002 Texas Meetings Participant Groups

Members of the following organizations and coalitions participated in the Social Investment Initiative's (SII) discussion groups in Austin and San Antonio, TX, in November 2002.

For a summary of what SII learned at these meetings, see the Texas Summary, which will be available on this site later this month.

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What Are Some Good Economic Stimulus Plans?

The chart in this article provides a comparison of some economic stimulus plans that have not come out of Congress. For a comparison of the Bush plan with Congressional plans, see this chart.

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Unemployment Assistance Needs to Go Farther

With last week’s round of self-congratulating that followed the President’s signing of an extension of federally-funded unemployment benefits, one might think that the bill’s benefits would reach all unemployed workers in the country. Indeed, the bill’s signing came just in time for those workers whose regular (or state-funded) unemployment benefits ended December 28. Without the extension of the federally-funded “Temporary Emergency Unemployment Compensation” (TEUC), these workers would have been left with no assistance. Under the renewal of the TEUC, this group of unemployed workers will receive 13 weeks of federally-funded unemployment benefits, or up to 26 weeks, if they reside in states with exceptionally high unemployment rates.

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House Republicans Institute Dynamic Scoring; Waive Debt-Ceiling Votes

Included among its questionable first actions in the 108th Congress, the Republican-led House Ways and Means Committee made two new troubling rule changes that will govern House legislation around the federal budget.

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Continuing Resolution, Take 8

Last week the House and Senate Passed, and the President signed the eighth continuing resolution (CR) of the FY 2003 budget season. This CR will keep the federal government and the programs it funds going through January 31, 2003. Without the CR, there would be no funding for these programs and the government would be forced to shut down – an option no one wanted to serve as the opening to the 108th Congress last week. As discussed in previous issues of the Watcher, there are many problems for agencies trying to operate under a stream of CR’s, which only continue last year’s funding levels, with no increase for inflation. There is hope that this will be the last CR necessary for FY 2003, as many in Congress want to complete work on the remaining 11 appropriations bills by combining them into an omnibus appropriations bill – to allow them to move on to the FY 2004 budget.

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The New Round of Bush Tax Cuts--Inequitable, Ineffective and Costly

Bush’s new tax cuts, thinly disguised as an economic stimulus plan, fail every test – whether that of equity, economic stimulus, or responsible budgeting that addresses the nation’s needs. The only test that the Bush plan passes is that of making the President’s wealthier constituents richer while forcing diminished government services upon the rest of us.

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