On State Budget Cuts and Can Kicking: Do accounting short cuts and more debt make smaller problems bigger?

Govs feel the weight of wielding budget ax

…Since taking office last year, Arizona Gov. Jan Brewer (R) has criticized accounting gimmicks and borrowing that, she has said, led to the Grand Canyon State’s current budget “crisis.”

But now Brewer is defending a compromise she struck with state legislators that relies on the same type of budget tricks and borrowing…

…the state would borrow $750 million and delay making $450 million worth of payments into the next fiscal year…

In neighboring Nevada, Gov. Jim Gibbons (R) plans to call legislators back to the capitol by the end of the month to deal with an $880 million gap in the current two-year budget…

…the $880 million shortfall would require a 20 percent cut of state government operations…as The Associated Press explains it: “Nevada’s budget is so far out of balance that by one account the state could lay off every worker paid from the general fund and still be $300 million in the red. The economic downturn has hit so hard that prisons may be closed, entire colleges shuttered and thousands left without jobs.”

…Gibbons’ plans would result in the layoffs of 234 state employees. But the layoffs won’t save the state as much as many people think, because the state still must pay for unemployment benefits…

…school superintendents maintain that to make the 20 percent reduction, without pay cuts, they will have to resort to massive layoffs, larger class sizes and maybe even a shorter school year.

Stateline.org