Its the deficit dummy by Daniel J Hoban

I can hear a sound, a whisper, a growl. It is the sound of impending doom. It is the sound of a deficit BOOM! Day by day cities and states are laying out the bad news. Is anyone listening? Taxes payments of all types are coming in far below plan. Most are down 20-30% from projected.
In Connecticut they are down 20% and the deficit for the current year has ballooned to $1 Billion. In Massachusetts taxes are expected to come in $3 Billion lower. Michigan has suddenly discovered a new $1.32 Billion deficit. Florida recently suggested their deficit could grow to $6 Billion next year as taxes paid decline rapidly. Ohio is a train wreck and illustrates the nations problems very well. They have used massive federal money to fill the budget gap. That money goes away next year and they have no plans that will bridge the gap. It is estimated that they will have a deficit of $8 Billion by 2012.
The sheer size and scope of this problem will change our country. States are not allowed to run deficits so must choose between higher taxes or budget cuts. The spending cuts required to balance the budget would be devastating . They would have to cut deeply into permanent budget items. If new taxes are used to cut the deficit they would shock an already weary and burdened voter. One has to wonder how an economy will react to higher taxes at every level. It is very likely that property taxes , sales taxes, state and federal taxes will all go up at the same time creating the highest tax burden Americans have carried in decades.
It seems very likely that we a setting the stage for a double dip recession or a multi year recession.
Daniel J Hoban