Local Governments To Cut 500,000 People In 2010 And 2011, As $400 Billion Budget Shortfall Brings State Economies To A Halt

Tyler Durden's picture

Ever wonder why according to the latest economic poll published by Reuters earlier the general public's satisfaction with Obama's handling of the economy is deteriorating faster than any other issue? (not to mention that 46% of Americans believe Obama is not focused enough on job creation, and that 72% of republicans say they are certain to vote at the November congressional elections versus 49% of democrats). A part of the answer comes courtesy of a new study produced by National League of
Cities, the U.S. Conference of Mayors and the National
Association of Counties titled simply enough: "Local Governments Cutting Jobs and Services: Job losses projected to approach 500,000", showed local governments moved to cut
the equivalent of 8.6 percent of their workforces from 2009 to
2011. As a result of local government cutbacks, almost 500,000 people will lose their jobs, and the total will likely rise. The summary of the report attached below, is particularly grim: "Over the next two years, local tax bases will likely suffer from depressed property values, hard-hit household incomes and declining consumer spending.
Further, reported state budget shortfalls for 2010 to 2012 exceeding $400 billion will pose a significant threat to funding for local government programs. In this current climate of fiscal distress, local governments are forced to eliminate both jobs and services." If Americans are dissatisfied with Obama's handling of the economy now, just until 2012.

More from Bloomberg:

While a separate report by the National Conference of State Legislatures today said U.S. state revenue is recovering from the drop in tax collections caused by the 2007 recession and the slow pace of job growth since, the greatest blow to local governments will be felt from now through 2012, the local groups said.

They called on Congress to pass a bill that would provide $75 billion in the next two years to local governments and community-based groups to stoke job growth and forestall deeper cuts.

Such a move may face political obstacles. Governors have appealed to Congress to extend additional aid to cover the cost of providing health care under Medicaid, the state-run program for the poor. The proposal stalled in the Senate, where the Republican minority has raised concern about the size of the federal deficit.

Full report that somehow made it through the tractor beam clutches of the propaganda death star.


Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
WineSorbet's picture

Separation of corporation and state is the only thing that will save us.

DrLamer's picture

Nop. No "thing" will save you. The "things" went too far.


A Nanny Moose's picture

+1. According to your junkers, apparently there is still hope. Do they still think the Gummit can stimulate jobs, and create wealth by stealing from the productive, and by stifling innovation in favor of entrenched coporate behemoths?

DrLamer's picture

Regardless of what is discussed here and there, Mr. Big O is not an expert on economics.  Big O will do whatever he will be told by *David Axelrod* and his budies from

AKP&D Message and Media




Born February 22, 1955 (1955-02-22) (age 55)
Lower East Side, Manhattan, New York
Political party Democratic Spouse(s) Susan Landau Children Lauren Axelrod, Michael Axelrod, Ethan Axelrod Alma mater University of Chicago Occupation Senior Advisor to President Obama Religion



DrLamer's picture

After flood (limited, like in paganistic voodooistic New Orleans, about 100m high) the rest of the un-uNited States will be transformed into a new society, based on a new law. It will be done in a very, very unusual way. Unfortunatelly, (1) even if to start tomorrow, it will take 30 years or longer; (2) the group of The-Resposible-Persons-not-from-this-world see no reason to start this transformation at all. US citizens are pagans.

That is why:


dark pools of soros's picture

your religion stole many of the pagan rituals..  i guess it didn't have any legs of its own

still kicking's picture

does that change the message?  it's about faith not symbols, relics or rituals.

Shortbus Bully's picture

If a religion has to assimilate local religions in order to assimilate local populations then I'd bet it's own message really ain't all that great.

Nacho.Libre's picture

Ok ZH community, what's your solution?  Let's get some things going...


Cursive's picture


Well played.

WaterWings's picture

If there IS any solution it's "Get thee to the farm."

Cathartes Aura's picture

++ a garden

the only "solution" is taking responsibility - for yourself, your loved ones, and anyone else you trust.

everything else is hot air.

(and best start today, you're behind schedule)

WaterWings's picture

No kidding around about that. The only savior is storable food for the transition - you can barter the excess for what you forgot back in the city; if someone else stocked up whatever that might be, like tampons - don't forget those. If you are learning when it counts you can reduce your chances of survival by at least one order of magnitude.

Cathartes Aura's picture

+ *vigorous nods* 

mentioning "tampons" is a popular theme here. . . I know it's often "jokey" and I usually just pass on responding, but what the hell, here goes. . .

commercially produced tampons use dioxins and artificial fibers that can leave residue threads behind causing many internal problems, including toxic shock syndrome. . . the idea of using "bleach" internally is not one I entertain nor recommend. . .

research has shown "menstrual huts" were historically common, and sometimes gapped floors allowed for bleeding onto straw, fibers, soil, etc. which was eventually used to fertilise the fields (of course, people were less toxic then, minus pharmaceuticals, etc.). . . if you are at all curious, this is an interesting thread with good links:


(you need to know I'm hesitating over the "save" button. . . lol)

RockyRacoon's picture

I admire your moxie, but nothing short of torches and pitchforks will do the job.

docj's picture

No, no, no Tyler.  This is all the Republicans fault.

After all, they (allegedly) won't let Barry prod Uncle Sugar to borrow another $1T Bennie Bucks to bail out the states and cities (and their public employee unions).  So you see, if those mean old racists would just let Turbo Timmy borrow more Sugar from the ChiComs then this would be all good.

Think I'm kidding?  This is essentially Team HopeyChangey's playbook for 2012.

pan-the-ist's picture

I'm confused, doesn't the 500,000 jobs represent largess that would be removed anyway if the conservatives prune the extra expenses?  Are you suggesting that the republicans will restore those jobs and the democrats are bad for letting them wither?

chistletoe's picture

the republicans are just chomping at the bit

to create a bunch of new new jobs in some exciting localities...


....in Iraq, Afghanistan, Iran, North Korea, Venzuela, Cuba, Mexico ....

knukles's picture

Morticians and Gravediggers.

DaveyJones's picture

magicians and mortitians

docj's picture

What's to be confused about?  Not to be snarky, but I'm confused as to how you're confused.

Looks like I hacked-off some Axelturfers, though (4, to be precise, at the time of this last edit).  Which is always good.

perchprism's picture


You're almost right.  What's going to happen is that we taxpayers get to bailout the states like California and Illinois so they can keep their civil service work force intact.


RKDS's picture

Here's the thing alot of people who've never worked in gofernment always seem to miss:

There's an awful lot of waste in government but cutting all the regular employees like some of you austerity nuts want won't even put a dent in it.  Like in any large organization, the waste is at the top.  It's in legislative budgets, ruling class perks, no-bid contracts, no-work crony appointments, federal mandates, social engineering programs, pork projects, tax breaks/subsidies, etc.

Just using Pennsylvania as an example, employees and pensions made up less than $2 billion of a $30 billion budget.  I can't even begin to detail the fraud and abuse and stupidity that sucks up the other $28 billion.  Millions in legislative slush funds, grade schools with 10 principals, paying 5 times the market price for computer equipment, brushing welfare fraud under the rug, handouts to major league sports teams, the list is a mile long.

And absolutely NONE of it will be solved by firing normal state workers en masse.  You'll pay through the nose for no services whatsoever.  And your invincible and pure "private" business, the one that sells to government or its employees and retirees?  Right down the tubes even faster.

knukles's picture

But you're far and away too rational.

The tips of the spears must be trimmed; police, firefighters, EMS, etc., so that services are curtailed clearly displaying to John Q. Taxpayer that the Powers That Be are in dire straits, there Can be No Further Cuts. 

Indeed, the Only Catharsis is Higher Taxes, Mr. Middle Class. 

For the waste and abuse, the doling out of public monies by the politicians to friends, relatives and campaign donors Must Be Preserved at All Cost.  It Shall Not Be Stopped.  It shall be Campaigned About, Spoken of, Debated, but Cannot Be Stopped.   

WaterWings's picture

You can't even object to an order from a uniformed thug, unlawful or not, without fear of being beaten to a pulp or charged with felonies:


This one is long but worth it if you want to see the current mentality. Obey your masters!


Tazed! This kind of stuff is all over YouTube - what fraction of reality is it? No wonder it's a felony in three states to film uniformed thugs using excessive, unlawful force:


Chunkton's picture

I think being tazed is a small price to pay to be able live in the greatest country in the history of the universe, you should be grateful. Being taxed into poverty is a blessing, all those public workers being paid like millionaires adds to consumer consumption which is what made this great country great.

Sending your children to be slaughtered in foreigb wars or then having the opportunity for them to slaughter others not only builds backbone but is blessed by God, who wants all non-believers dead. Don't pay attention to the other religions that also want all non-believers dead as they are the spawn of Satan and not to be trusted.

What ever happened to just looking sfter your own country and helping its true friends, as opposed to be  a world power for the benefit of...

Cursive's picture


Very true.  I particularly like the no-bid contracts as an area of low-hanging fruit ripe for the picking.  Most pro-market people I run into don't seem to understand that the government is so pervasive that a large portion of a company's revenue is dependent on government.  The government is into everything and completely distorts the free market.

docj's picture

I completely agree on the state level.  On the local level though it's entirely headcount based (something like 75% of local budgets are salaries and benefits).

Thing is you could reduce much of that without laying-off a single person.  Look at the number of "cirriculum coordinators" there are in the school system, for example.

technovelist's picture

Hmm, it seems to me that if all of the state workers were laid off, there would be no one left to spend the money.

Hey, it's worth a try!

Econolingus's picture


None of the current problems existed before Obama took office.  Then suddenly on 1/20/09, everything went to hell.

Obama has certainly exacerbated a bad situation.  But let's be real about where the troubles started and bring Greenspan (bubble-mania) and Bush/Cheney (reduced revenue/increased spending) into your mental model, shall we?


DaveyJones's picture

it took both criminal parties to get here. That's why electing either is a pointless act.

Translational Lift's picture

Do you prefer Regular Republican crooks or Fascist Democratic crooks??

Shortbus Bully's picture

Each party represents a side of the despotic state coin.  Republicans represent social control (PATRIOT act, Defense of Marriage act etc) and Democrats represent economic control.  Each party is instrumental in the metamorphosis to total despotism.

docj's picture

None of the current problems existed before Obama took office.

Uh, I never said that.

Obama has certainly exacerbated a bad situation.  But let's be real about where the troubles started and bring Greenspan (bubble-mania) and Bush/Cheney (reduced revenue/increased spending) into your mental model, shall we?

Add Billy J Clinton and Phil Gramm to this and I agree completely.

dark pools of soros's picture

bring Jimmy Carter back... just to piss off all the fat cats

Moneygrove's picture

+ the 5.5 trillion bush spent on what ????

docj's picture

You know, I'm old enough to remember just how much the late-70's sucked.


StychoKiller's picture

I believe that most here would agree the slippery slope saw footprints in 1913 with the creation of the FED.

docj's picture

That would include me.

I believe a truly unvarnished history is going to be particularly unkind to Sir Alan, however.

economicmorphine's picture

8.6% sounds like a good start.  Why stop there?  Cities and states could be flush if they made 25% cuts the target!

mnevins2's picture

And how many of these job cuts could be avoided if the present employees made less and  had less generous retirement benefits?  Will this be done? NOT if the union leadership, which is generally the sr employees (and thus could give a rat's ass about the jr employees - they just want their pension $$$$) have anything to do with this, and so this common-sense solution doesn't have much of a chance at all.

Oh yes, find a way to reduce the present pensions above a certain limit and the upcoming one for the village mgr and his cronies in Bell, CA!

Bohica's picture

Hey, no sweat on those pensions.  They all gonna earn 8.0% - 8.5%/year as far as the eye can see.

TrulyStupid's picture

Yes, let's cancel social security payouts, fire government employees, cut the minimum wage, raise the salaries and benefits to members of congress, cut taxes and print money to make up the budgetary deficit.  More trickle down economics in action!


mnevins2's picture

"Yes, let's cancel social security payouts, fire government employees, cut the minimum wage, raise the salaries and benefits to members of congress, cut taxes and print money to make up the budgetary deficit.  More trickle down economics in action!"

No, why don't we reform social security, review govt employmnent - including salary and benefits, allow the states to determine their minimum wage, legislate that congressional districts be determined such as Iowa does their's, reform and review both federal taxes AND spending in order to stop stealing from future generations (to pay for today's baby boomers - which I am one) and focus more on private sector growth rather than public sector growth?

Bush and the Republican majority failed to do this last decade, but Obama and the Dem majority promised to do this with their fillibuster-proof majority - and never really meant it. We need divided govt and I hope that we'll obtain it in the next election.


midtowng's picture

"We need divided govt and I hope that we'll obtain it in the next election."

 We already have a divided government. What we are going to get with the next election is a majority of Republicans and Blue Dog Democrats. Thus we will return to the policies of Dubya.

StychoKiller's picture

Also, add the following amendment to the US Constitution:

"Congress shall make no law abridging the freedom of Production and Trade."

RockyRacoon's picture

Oh, great.  One more amendment to be ignored.

Wonder what "make no law" means in Washington, DC?  Nothing.