Governors’ Budgets: Federal Aid Needed to Prevent Job Loss

States are facing an estimated $180 billion budget gap for FY 2011 (which begins July 1st, 2010 in most states). A new report from the Center on Budget and Policy Priorities, Governors’ New Budgets Indicate Loss of Many Jobs if Federal Aid Expires, outlines the significant cuts proposed in governors’ FY 2011 budgets. The cuts will predominately affect education, health care, and programs that serve low-income families and the elderly. According to the report, reducing funding in these areas would lead to a further weakened economy, including significant job-loss. The report outlines the impact of the funding provided by the American Recovery and Reinvestment Act (ARRA) in preventing job-loss and increasing demand. The report emphasizes the need for Congress to provide additional fiscal relief to states facing record revenue declines.

Policies to Expand Economic Opportunity.