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US Sees the Lights Go Out as States Scrimp and Save
Published on Thursday, April 24, 2003 by the Times/UK
US Sees the Lights Go Out as States Scrimp and Save
by Roland Watson in Washington

IN MISSOURI they are unscrewing every third light bulb. Prisons in Illinois are splitting prescription drugs in half. The Governor of South Carolina is urging others to follow his practice of reusing Post-it notes and saving paper clips.

If voters go into the presidential election year in 2004 with their education and healthcare systems in chaos, it may present Democrats with an opening.

Across the United States the worst budget crisis in half a century has forced states to scrimp for savings in a style reminiscent of the Great Depression. Together, the 50 state governments are facing deficits of $30 billion (£19 billion) this year and $82 billion next.

Because all but Vermont are obliged by their own laws to balance their budgets, they have to find $112 billion-worth of savings in two years. California, which has the biggest deficit, is about to run out of money.

Tax rises would help to meet some of the need, but in many states moves to increase taxes have been defeated by legislatures or voters, leaving drastic cuts as the only way to make ends meet.

“The Big Turn Off” in Missouri, which has dimmed electric light by a third in most government buildings, is typical of the desperate scramble to save pennies. In Kentucky, every other ceiling light has been turned off in the State Capitol.

The Kansas Governor has asked agencies to drop the gold-embossed state seal from stationery, saving 2c a page. Agencies in Oregon are banned from color printing.

Such measures, although eye-catching, are largely symbolic, Scott Pattison, of the National Association of State Budget Officers, said. “They demonstrate that you are doing everything you can.” They are also aimed chiefly at administrative agencies, or at areas of spending where there are fewer votes, such as prisons.

Jail chiefs in Illinois are trying to cut their prescription drugs bill by ordering double-strength drugs and splitting them. In Virginia, prisoners are to receive only two meals a day at weekends. Kentucky has chosen an alternative route, releasing prisoners early.

The sums involved make it impossible, however, for state governments to confine their cuts to politically marginal areas. In Oklahoma, teachers are mopping floors, driving school buses and cooking meals because support staff have been laid off. In Oregon, teachers worked for two weeks without pay to keep schools open. School districts in some parts of Colorado are operating four-day weeks. In Idaho, towns have held cake sales to keep teachers on staff.

Across the country, tens of thousands of poorer families are losing access to healthcare as capitals cut back on the Medicaid program. In Texas, 275,000 fewer children will receive healthcare.

California, which faces a $30 billion deficit, 30 per cent of its budget, will have to start writing IOUs by the summer unless it finds a way of raising money. Alaska and Oregon face even bigger deficits as a proportion of their budget. Nevada, New York, Arizona, New Jersey and Texas all face deficits of between 15 and 20 per cent of their budgets.

The turmoil has yet to threaten President Bush. The White House has tried to keep the issue at arm’s length, refusing to bail out states and telling them it is their problem. Mr Pattison said that voters tended to take their wrath out on state legislators rather than presidents for local problems.

Mr Bush travels to Ohio today to bang the drum for his economic priority, his endangered package of federal tax cuts. The state demonstrates how state budget deficits could yet hurt him. Ohio is planning to cut 50,000 people from health coverage, the largest such cut yet.

If voters go into the presidential election year in 2004 with their education and healthcare systems in chaos, it may present Democrats with an opening.

Mr Bush contends that a recession that began before he came to office, coupled with war, is behind the financial straits of states, as well as of the economy as a whole. States, too, share some of the blame for gorging on the 1990s boom with little regard to possible perils ahead. They cut taxes, increased spending and put some aside in reserves. But it was not nearly enough.

“States are really hurting,” Mr Pattison said. “It is particularly bad because in the past they have relied on rainy-day funds to cushion the pain. Now it is nothing but painful cuts.”

Copyright 2003 Times Newspapers Ltd


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