STATES' MONEY WOES

Physician's Money Digest, July15 2003, Volume 10, Issue 13

Wall Street Journal

When the economy was ridinghigh, spending by the individualstates was cruising right along with it.But when the economy tanked, choppingstate tax revenues, state spendingbarely slowed, according to arecent report. In2000 and 2001, state and local governmentsincreased spending bymore than 8% each year. Even lastyear, when the economy really icedover, government spending at thestate and local level was up nearly5%. So far this year, outgo is up byanother 6%. Any spending cuts thatstate governors may ballyhoo, criticssay, are coming after fat increases inoutlays in previous years, or else aren'tactual cuts. They maintain that a 10%boost in spending that's pared back toa 4% increase is not really a "cut."