State governments, unlike the federal government, have to balance their budgets according to law. A tough task in normal times, but after the Great Recession it became much more difficult for many states as economies around the nation suffered. Here is a list of the state’s entire projected deficit for the fiscal year of 2012.
Texas, the state government cut $5.4 billion dollars in spending on education statewide. Part of the cuts involve having to lay off 25,000 public education workers, including 11,000 teachers. These cuts are occurring while student enrollment is increasing, by more than 80,000 per year. Texas is facing a two-year budget shortfall of $27 billion.In
California last election passed new regulations raising the income tax rates for the wealthy, 10.3% for those earning over $250,000 and 13.3% for those earning over $1 million. The increases are expected to lower the budget shortfall, a projected $16 billion in 2012, down to $1.9 billion by the end of summer in 2013. But the tax hikes might cause an exodus of the wealthy from the state, who do not wish to pay the higher tax. The wealthy already feel they carry enough of the burden. The top 2 percent of earners, those over $450,000, pay 46 percent of the state’s taxes. Those earning over $1 million account for 25 percent of the entire state’s taxes.
This link shows all 50 states, estimated budget shortfalls, tax change percentages, and cuts to various programs. Minnesota from Jan 2010-March 2011: personal income tax increased 17%, corporate income tax increased 30.6%, and sales taxes increased 3.6%.