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Local Governments To Cut 500,000 People In 2010 And 2011, As $400 Billion Budget Shortfall Brings State Economies To A Halt
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.
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Cut business taxes and the bureaucratic bullshit, paperwork, and the business license extortion rackets that new business men and women have to contend with on a daily basis. Create an environment like the wild west where ideas and dreams have a chance. Repeal minimum wage laws and create competition. Let house prices fall to levels where valuations aren't artificially propped up. Entrepreneurs will come out of the woodwork...everyone with an dream will try and create something new, and tangible. New services will be created to service all the newly created vibrant businesses. Pretty simple stuff...
No can do, piceridu! House price depreciation will ruin the Banks, don't ya know?
Cutting business taxes and simplifying paperwork will put civil servants out of jobs.
States need that tax money to buy more buses to transport the needy, provide meals on wheels, and build handicapped access ramps. The Feds need the tax money to show the rest of the world that our reserve currency is backed by real money, not just military might.
The Wild West scenario will not prevail. That would put many law enforcement and fire department folks out of work. Can't have that.
Your ideas will work but the transition period would sink the economy during the growing pains. The status quo would be upset. Politicians would be replaced, no more 30 year terms. That would upset the well-oiled wheels of DC and chaos would ensue.
Whassamatta with you? You nuts?
Sorry but Obamatron is trying to lift one mighty big boulder and ALL the steroids (FRNs) in the World aren't gonna be any help this time.
"Full report that somehow made it through the tractor beam clutches of the propaganda death star."
They let this one escape. They could have easily launched a hundred talking heads to prevent this. We're being set up!
"Full report that somehow made it through the tractor beam clutches of the propaganda death star."
+1138
About the funniest comment I have read on here in weeks.Thanks for that.
Of course this one made it thru. It rationalizes why Congress and the Prez need to ramp up the deficit by another half a trillion dollars to make sure SEIU members don't get laid off and keep paying their dues.
This is a product of the propaganda death star.
+1
Not going to happen. We did not want TARP when we feared the world was going to fall apart. We will not want QE 2.0 having witnessed TARP's failure. The contraction of credit is the acceptance of our fate. We are busy boarding the windows and mining the yard because we KNOW what is coming and have, albeit unnervingly, accepted it.
The debt ceiling will be raised just enough to keep the state and federal governments afloat with haircuts... we will not get any dramatic increase in stimulus. TARP was the alarm bell to man the life boats... all the spots are reserved and now they'll watch us sink on the ship.
I for one, still fear that the world is going to fall apart.
No, there is a difference between now and 2008. In 2008, we feared the world was going to collapse, little little debt dominoes smacking from bank to bank. Now we KNOW this is going to happen from bank to bank and country to country. In other words, our fears have been mostly realized...
You may have a point. Or, maybe this report is just observing the inevitable effects of collapse. Or, maybe both...it's a carousel to hell.
Today's Polls have the President hovering barely above his all time lowest ratings:
Rasmussen has him at -20 (His lowest being -21)
Gallup has him at 47 Disapproval (Lowest being 48)
You can always predict some form of grandstanding and free political goodies to be handed out at about this time and some illusory "Enemy" opposing the President's efforts to get the economy back on track.
For example the other day we had him discussing the how partisan politics in campaign finance reform are unacceptable. Mr. Corporations was actually scolding politicians and the inherent dangers of allowing corporations to influence political office..just incredible.
Then last week we had Feinberg's nicely timed list on stating the obvious that Wall Street was paying out nearly 2 billion in bonuses with 80% being unjustified as these firms teetered on collapse.Their punishment...Clawbacks? Indictments? Subpeonas? DOJ investigation? Cutting off ZIRP? ..nope...Their shame and tears are enough.
Afghanistan Wikileaks leaks stating the obvious that we are fighting a very expensive unnecessary war if we are allowing Pakistan to aid and abet the enemy and likely hide Bin Laden. Next day we have WH former press sec Ari Fleischer front running on Morning Joe MSNBC calling the President, "Heroically keeping Al-Queda from reforming by chasing them down using unprecedented concentration of U.S. forces in Afghanistan".
Fully expect every single story to be blown to immense proportions so long as it distracts from the largest issues domestically. Rangel, captured sailors, North Korea nuclear threat absolutely anything aside from stepping up and admitting errors were made, taking responsibility and telling the truth.
19 million - the number of barrels of oil we consume daily.
5.3 million - the number we produce domestically
13.7 million - the number we input
Now riddle me this? If we can't drill in Alaska and we can't drill offshore where's that 13.7 million going to come from. It comes mostly from 10 countries, five of which hate us, that's where. Now, where is the one area of the world where there's oil and they are beggin for Western capital? The Caspian region. Afghanistan sits directly between the Caspian and the Arabian seas. It is the perfect pipeline route for a bunch of the 13.7 million barrels of oil we will need to import today, tomorrow and every single day to come until we figure out a better way. Check out the DOE website. Afghanistan isn't as unnecessary as you seem to think it is.
Putting pipelines thru Afghanistan would be stupid. It would be viewed, correctly, as "every day is Christmas" for local terrorists and other gangsters.
exactly.
that's why amrka continues to poison the ground, the people, its own soldiers, with weapons of mass destruction, including depleted uranium that will outlast even this nationstate, and others, and the distressed, deformed and dying humans, generations.
amrka needs a pipeline for the oil.
Yup. Big Pharma has drugz to help your incontinence, ED, leukemia, etc.
Problem, solution.
7 Secret Ways We Are Being Poisonedgreat link WWings - succinct with good links - will add it to my overloaded bookmarks file. . .
any site that includes information about the barium & aluminium trailing being deliberately sprayed in our skies, daily, is noteworthy. . .
(priceless pic of rumsfeld next to the aspartame paragraph, hahahhahh. . .)
Putting pipelines thru Afghanistan would be stupid. It would be viewed, correctly, as "every day is Christmas" for local terrorists and other gangsters.
American WORLD THIEVES!!!
You are all victims of your own insanity and immorality.
Robbery in Afghanistan
Robbery in Iraq
Robbery in Europe
Robbery in Africa
Now you become cannibals on your own folks!°
Now riddle me this? If we can't drill in Alaska and we can't drill offshore where's that 13.7 million going to come from.
Bakken. The oil reserves there rival Saudi Arabia.
GFD, i hope this was sarcasm.
No. It's America's best kept secret.
"You can't HANDLE the TRUTH!" -- Colonel Jessop
for those who missed this on Barry's site today
perspective on billions and the Financial Bailouts
http://www.informationisbeautiful.net/visualizations/the-billion-dollar-o-gram-2009/
Finally! An end to the welfare state is in sight.
Yes. An end to many failed government experiments in social services as well. A return to real freedom is in the cards....hang in there.
This should be good for a 500 point pop to the upside on the DOW. Who the hell needs jobs and wages and real demand when PD algo's can tell us about where the economy is headed?
Doesn't sound like the locals are going to get a QE2 bailout from our community organizer.
Right. Double whammy then. Obama can be blamed for the rise in unemployment.
Talk about digging one's own grave....
Willie Brown (ex- San Francisco potentate) was on Fox this morning trying to protect his fabulous pension from the grubby unemployed...
State poor and Fed rich (in paper). In a paper world, this actually means more power to the fed.
Clearly a huge move back to centralized power.
Prior to the announcement of the "new" new administration controlling 10 FEMA districts.
You all know this is coming right? Nixon passed it. It's been sitting in limbo since 1971-72. Easy to find on google.
End of the experiment is nigh.
ORI
http://aadivaahan.wordpress.com
Not really. The states are not without redress. The ability to print their own currencies and create their own banks is, pretty important.
Further, how do you reconcile the issue of marijuana legalization? Effectively, states have told the federal government to go fuck itself, they're not enforcing federal regulations. Why stop with marijuana (e.g. AZ)? The point is, if necessity calls and states need to raise revenue, they will have no qualms about telling uncle sam to go fuck itself if it stands to help the situation. Those states that are economically self sufficient (net outflow to uncle sam), may just end up with... incredibly interesting incentives.
This conversation is purely academic anyway... I honestly do not think we will likely get to see too much of it play out... they won't keep it together that long.
We've seen how the Federal government handles states trying to protect their borders...
By suing them to determine if they have the authority to do so? Of all the tools in the federal government's arsenal, this is it? I'd say they dealt with AZ rather cordially... I suspect that won't be the trend going forward. Especially when the property taxes come due on all those fannie and freddie mortgages.
Federal troops to quell the local uprisings would not be new.
Try Central High School, Little Rock, Arkansas, 1957.
It will be the norm going forward as municipalities' cries for help fall on the deaf ears of the state. I suspect uncle sugar will have deaf ears shortly thereafter... again, Congress is busy passing laws that no one is going to enforce...
As a Macho man, perhaps this analogy will be apt.
Who has whose balls in a death-grip?
The rest follows.
ORI
http://aadivaahan.wordpress.com
The fact that the city of Fresno, CA had 4160 employees is the government problem in microcosm!
How about giving the small people something tangible to look forward to? The way things are going I fear that some form of autocracy will rise by necessity to keep food moving and maintain a modicum of social order. So who would you rather have as Tyrant of the United States? Barry or whoever the Republicans come up with? Obviously if this happens there will be much resistance from Americans, after all it is the American way. But many will capitulate and follow the leaders...so who do you think the sheeple will pick?
I still can't believe this story from Bell, California:
There are a few caveats to this story. The City of Bell is also managing a neighboring city which is insolvent. We're talking about few hundred thousand dollars in salaries, for budges in the tens, or hundreds of millions probably. Thirdly, what the voters didn't know this was going on? Like the war in Iraq, the public makes bad choices supporting these things, and then repents at their leisure.
In a downward spiral, the half-life of action-reaction pairs diminishes rapidly.
I think the "bad choice - repentance" cycle time will get shorter and shorter.
It will get very interesting (ugly?) to see what the political landscape looks like when that cycle drop below 2 years.
and it should happen sooner at the local level, where anyone with a few dollars for the filing fee can run my local city has actually become empowered during the slowdown, they are spending money like mad.they use eminent domain, they raise the sales tax, its all good. and we're just about a hour away from Bell
I see a lot of angry people but no change. Nationwide. Hmm. Wonder what gubmint has up their sleeves...
It's the flouride in the water that keeps em in check.
Cities to Fund Bell Official’s Huge Pension | July 26, 2010
Bell, Calif. CBS13 -- City officials in the southern California town of Bell are coming under fire for their outrageously high salaries, but the pension of one official in particular could cost as much as $33 million. And, CBS13 has learned that some local cities will be forced to pay for it.
He's the new poster boy for government worker greed.
"We're all paying for it," said Marcia Fritz, a member of the group Calif. Foundation For Pension Reform.
Small town taxpayers across California are on the hook for a millionaire manager created by the city of Bell, according to accountant and pension reform advocate Marcia Fritz.
"He's retiring early. He's only 55 years old. He's going to live probably another 30 years," said Fritz.
Based on Robert Rizzo's salary of close to $800,000, Fritz estimates he'll earn $26 to $31 million dollars in retirement, which the cost covered by small cities.
"Citrus Heights, and then Lincoln and Rancho Cordova," said Fritz.
There are 140 of them -- all part of a pension risk pool created by CalPERS.
http://cbs13.com/onthemoney/bell.citizens.threats.2.1826314.html
Fk the hook. It took some lawyers to draw up the fraud so lets get them busy erasing the fraud.
Jail time on the amount line of the monthly check.
Want to know what would turn the US around ?
See this in the am headlines....
US eliminates all individual/corporate income taxes...to be replaced by a 10% consumption tax.....
how do you think that will work in communities where the sales tax is already 10%. Precedent is the new federal VAT might bump the total number to ten and take the difference between the local tax and the new federal number. I just don't see it replacing the uneven system of sales taxes in this country. too big a job.
I am at a loss as to your reasoning. States + local then on top of that we would have a federal tax. 10% state+local then add 10% (or whatever) fed. If corp/individual taxes are eliminated, of course you make it up in a national sales tax.
By the way, take a look at how gas taxes work now (multiple levels of sales tax). Check your phone bill, same thing.
yeah - so glad we made the utilites private!! now we pay some CEO & the gov'ment!!
@Leo : Uncle Ben makes it possible. FED´s printing machines working all day and night. By the way : 38 $billion in 2 year notes auctioned couple of minutes ago. Where is all this mony coming from bond fund managers are throwing into 2 years ? Take an informed gues...:=)))
I love how some of those here blame the current administration, as if we would be better off with another party in charge. It wouldn't make a bit of a damn difference. We would still be in the Titanic post-iceburg, with officials trying to keep the casino floor water free to let the public roll the dice. I do not blame Obama for the mess we are in, I blame 12 years of a failed government that takes it in the rear sans reach around from the lobbyists. The only true solution is the obvious one....let it fail and reset.
Golly, only 12 years? This particular Titanic set sail nearly 100 years ago, with the iceberg in full view the entire time.
It's the lifetimers in Congress that are the problem. Our congressmen are supposed to be equal in pwer, but that is not how it works.
Senority perks being banned would be a great start. Frank and Dodd should not be more powerful than my representation. They should be equal.
And I am ready for a means test before we pay these assholes. Kerry's yacht tells me we need not pay him any salary or cover his health care or retirement. If they are going to means test me for SS, I think it only fair.
wasn't there a famous line saying something like... let me control a nations money and i need not care who writes the laws??
central banks call the shots.. not the american idol politics of this age
The elimination----not of jobs, but employees----is a fraction of the number of muni and state hangers-on, politican hacks (that should never have been so high in the first place) have to go.
It would be a hell of a lot more meaningful if AFSCME let go the most unproductive members of this juicy featherbedding plum but you can bet that the way the people will be let go will conform to a formula in which the obverse will hold sway. The worst, least able will be kept
By all means let's eliminate 500,000 employees living off the fat but how about doing it in a way that assures that the most competent, the best, and brightest, should there be any, be the ones that are permitted to stay.
"By all means let's eliminate 500,000 employees living off the fat but how about doing it in a way that assures that the most competent, the best, and brightest, should there be any, be the ones that are permitted to stay."
AFCSME and teacher unions won't let that happen. They'll march, go on strike and scream "it's for the children" all day and every day.
This DID work for them in the past. Not any more - the general public just ain't buying it any more. But that won't stop them from trying.
There is no way to do this in many states and localities. They are unionized by the administrations favorite union, the SEIU. A large part of the administration's fiscal policy has been geared to assuring that SEIU jobs are retained. Therefore union dues keep flowing in and the union keeps paying a bunch of that money to keep the current scoundrels in office. Union work, seniority and hiring rules prevent efficient downsizing.
In addition, jobs that will be cut will be things like teachers, cops, road repair crews, and other things that benefit the folks who actually pay taxes. Jobs that will not be cut are administrators, social workers, grief counselors, medicaid counselors, grants to the National Lawyers Guild and the like. This is how politicians punish the taxpayers for not supporting raising taxes. They cut the stuff that actually benefit the people who pay taxes and keep the crap.
The whole point of deleveraging is to eliminate the nonperforming assets... unionized employees being a glaring example. Soon, they will have an incredibly simple choice, shut the fuck up and take their paycut or get the fuck out. The demand to fill their ranks will be vastly stronger than their lobbying ability and job performance. I also doubt our new robber barons will want any legacy unions hanging about... this is a temporary problem.
Frackin crazy talk.
The fact that the city of Fresno, CA still has 3500 employees is the reason that I still have no hope for this country.
BELIEVE IT, Bro Leo. Tiny Bell, CA.
California, awash in a $20 Billion dollar deficit. Govenor Terminator, begging the Feds (awash in a 13 Trillion dollar deficit).
This corrupt situation became exposed and rectified by a small but organized populace who was tired of getting screwed.
Around my county in California I can see that the health of the American economy that supports the government sector is not reflected on the home pages of MarketWatch and Bloomberg. More vacant retail and office complexes go dark every week…sometimes entire blocks; signs of unemployment are everywhere as small businesses cut back, if they can even hold on. Only the national chains and their cookie cutter malls hold on.
A landmark report on small business appears in today’s San Francisco Chronicle. This is the America that the PPT World hopes to silence… with its precious Dow and Treasury shills.
SMALL BUSINESS
As Revenue Keeps Lagging, So Does Hiring | TomAbate | July 27, 2010
Lagging small-business revenues may explain why job creation remains so weak.
Small businesses - firms with 500 or fewer employees - generated nearly two-thirds of all new jobs over the past 15 years, according to the Small Business Administration.
But Main Street firms seem to be suffering as consumer spending remains weak, while many Wall Street giants benefit from growth in Asia and the developing world, said Brian Pretti, senior investment manager at Mechanics Bank in Richmond."The really big blue chip guys have a lot of business in Asia and their earnings are good," he said. "The economic story is not so good for the local businesses."
Up-to-date facts about small-business performance are hard to come by because small, private firms don't report their earnings each quarter as do publicly traded companies.
But new data from the North Carolina accounting software firm Sageworks offers a lens into small-business finance.
Based on its analysis of thousands of anonymous financial returns from firms throughout the country with $10 million or less in annual sales, Sageworks estimates that revenues for small businesses fell 5 percent in 2009 and continued to shrink by 6 percent midway through 2010.
Sageworks Chief Financial Officer Drew White said that as sales fell owners reacted quickly to cut expenses to maintain their profit margins. "Unfortunately that means cutting salaries and jobs," White said.
The notion that small firms face a revenue squeeze is corroborated by the most recent monthly survey of the National Federation of Independent Business.
More than a third of respondents told the group that their revenues were down from the prior quarter. Nearly one-fourth that said revenue rose while the rest said sales were more or less flat.
Federation economist William Dunkelberg said until small firms see a pronounced upturn in sales, they are unlikely to do much hiring.
He said the current economic situation differs from past rebounds. It used to be that small businesses led the nation out of recession because they were the first to benefit from rising consumer spending and the recovery of the housing market.
Once small-firm sales turned around, they picked up hiring, helping to fuel the general recovery, he said.But in this economic cycle consumer spending and housing both remain weak, while global factors like stimulus spending in China and the speedier growth of developing economies benefit multinationals.
As a result, the nation's small-business job engine is stalled in a way that is not easy for government to influence.
"How do you stimulate revenue growth?" asked White at Sageworks, framing the question he thinks policy makers should be asking.
Small-business revenues down, hiring stalled
This chart summarizes the finances of thousands of businesses with $10 million or less in annual revenues. Still waiting for revenue growth midway through 2010, small firms are holding down payroll expenses to maintain profitability.
Metric ..........................…….………. 2006 – 2007 – 2008 – 2009 - 2010
Sales, percent change...……............ 7% 5% 3% -5% -6%
Net pretax profit margin……............ 6 6 5 5 6
Payroll as % of sales.....……............ 18 18 17 14 14
People squatting in their own homes:
http://www.youtube.com/watch?v=sHQXU9Kzgr8
JR... Haven't You Heard?
According to the BLS Birth Death Ratio... 146k new small business jobs were created in June alone!
I am sure many of them are right there in your Cali county! Green Shoots JR! Drink up your Kool-Aid...
Now That's Change You Can Believe In!
Jesse will fill you in...
"The BLS Added About 145,897 Imaginary Jobs to the Non-Farm Payrolls Headline Number"
How to right this ship?
End all corporate income taxes.
There is too much monkeying around with accounting to avoid taxes that the average investor fights a losing battle to discover which companies are really growing and which are cooking the books.
This leads to money being invested in the wrong places, which leads to a decline in overall real growth for the economy.
We need truth in taxation and spending laws. You cannot even calculate how much you are really paying in taxes. Too much of this spending is on projects that if the truth were told (real cost per job, real cost per passenger mile for busses, real cost per student per year), that we would say no more.
We need spending bills to be voted on at the local level by the people that will be paying the taxes, not people in Massachusetts being the deciding vote on higher taxes in Georgia.
We need the Federal Government to immediately stop funding state and local programs. I need to know the truth about which programs are efficient and which are not. Inefficient public programs are unneccesary friction on the economy.
End all corporate income taxes.
Ummm, yeah.... I can't really get behind this one. Our largest corps. have ENOUGH subsidy and love being thrown at them right now. I don't believe this is the answer to all that ails us friend, not at all.
Half of the Fortune 500 Pays NO US Income Tax...
ejmoosa must shill for the other half...
ZERO corporations pay taxes. They simply prepay the ultimate end users taxes for them then tack it on to the price at the end. Corporate taxation is just silliness. I buy any product from any outlet, the corporate tax is simply in the price. Hence, you and I pay the taxes. Might as well be a national sales tax...at least we'd all know what the actual price of government is.
By all means states, beg for money from the crack-dealing loan shark on the corner. Don't worry, there won't be any strings attached....except for you Arizona. Arizona, he would like to talk to you about that immigration law you are trying to enforce.
This has actually gotten psychotic. The states are begging money from the Congress as if they believe the money is pulled from some magic wallet. Goody for the people in South Dakota living fiscally in their means supporting the people in California!!
Only 500,000??
100x would be more appropriate to bringing them back to reality.
" provide $75 billion in the next two years to local governments and community-based groups to stoke job growth and forestall deeper cuts."
This is good, money for gubmint and ACORN.
it's only a matter of when, not if, before we all are gov't workers
I want to be either a stormtrooper, or a propaganda artist (economist).
At the moment, it's a self-perpetuating circle. The more you layoff the more income, sales, and property tax revenue you lose, which leads to more layoffs.
Yup. There is no way out.
Keep cutting the lard of the government, and cut pensions too. Restore PRIVATE industry by cutting public bureaucrats and taxpayer expenses to feed and medicate the public pigs.
*Deleted b/c in wrong thread*
The Only Fat High Paying High Benefit Jobs Left in Amerika:
Are Corporate CEO's, Obummer's Bankster friends and Government Administrative Ass-istants...
One of the things I find interesting about the housing crash is the fact that local governments aren't adjusting the property value assessments to match the reality of the market.
When the housing market was going sky high, I was told by many people how the assessors were slamming them almost every year with higher property taxes.
Property taxes will continue to paralyze the housing market, IMO.
It is exactly that type of thinking (long-term unemployed are not worthy of hiring) that is not going to help this country get out of the death spiral. Add that logic + drug tests + background checks + credit checks = very high unemployment. But it's OK, if the thinking doesn't change soon and these people lose benefits, it will = very high crime and more taxpayer costs to house more criminals. My suggestion, lose that type of thinking, karma is a bitch!