Tag: State Spending

States Have Hand Out Too

Obama and congressional Democrats have promised that soon after Inauguration Day he will sign an economic stimulus bill that could exceed $500 billion. The governors intend to request about $176 billion of that — $136 billion for infrastructure projects and $40 billion to bolster Medicaid health programs that serve the poor and disabled.

As the economic downturn has swept from the housing market to financial institutions to the automobile industry, Obama has begun sketching out plans to address a recession that most experts project will be deep and long lasting. At the heart of his approach is a massive infusion of federal tax dollars.

Unlike the federal government, which can run a deficit, most states are required to balance their budgets. In tough financial times, Medicaid often faces a double squeeze, said Diane Rowland, executive director of the nonprofit, nonpartisan Kaiser Commission on Medicaid and the Uninsured. Just as the money is drying up, more people are in need of assistance.

It appears there is growing support for a sizable federal investment in infrastructure, which Rendell and Douglas said goes beyond the traditional road and bridge repairs to include public transit, water and sewer projects and even broadband Internet. The two governors said states have $136 billion worth of “ready-to-go” projects.

How About The Anti-Tobacco Programs?

U.S. states have not lived up to their commitment to devote a major portion of their huge legal settlement with the tobacco industry a decade ago on anti-smoking efforts, health advocacy groups said on Tuesday.

In the 10 years since the landmark deal, the states have received $79.2 billion of the settlement and another $124.3 billion from tobacco taxes, but have spent only about 3 percent of it — $6.5 billion — on tobacco prevention and cessation programs, the groups said in a report.

The deal, which restricted cigarette advertising practices, requires tobacco companies to make annual payments to the states in perpetuity, with total payments estimated at $246 billion over the first 25 years.

The report was issued by the Campaign for Tobacco-Free Kids, American Heart Association, American Cancer Society, American Lung Association and Robert Wood Johnson Foundation.

No state currently is funding tobacco prevention programs at the levels recommended by the U.S. government’s Centers for Disease Control and Prevention, and only nine are funding such efforts at even half the recommended level, according to the report.

In November 1998, 46 states settled their lawsuits against the major tobacco companies to recover tobacco-related healthcare costs, joining four states — Mississippi, Texas, Florida and Minnesota — that had reached earlier, individual settlements.

And as of yet, most of the cash has not been spent where it was suppose to be. That in return should be a lawsuit challenging the lawsuit.

She Is A Fiscal Conservative?

Alaska Gov. Sarah Palin calls herself a fiscal conservative who wants to “rein in government spending.” She says she “reformed the abuses of earmarks in our state.” Republican John McCain said during the last debate that his running mate has “cut the size of government.”

But Palin didn’t cut the size of government as mayor of Wasilla, and she hasn’t done so as Alaska’s governor, city and state budget records show. Spending in fast-growing Wasilla increased by 55% during her tenure from 1996-2002, records show. In nearly two years as governor, she has presided over a 31% spending hike by a state government that sought earmarks from Washington even as it reaped billions from higher oil prices and Palin-backed tax increases on oil companies.

Alaska’s spending bills are split into a capital budget for infrastructure projects and an operating budget that funds salaries and other general government expenses. In Palin’s first two years, the state operating budget has increased 31%, and capital spending remained roughly at the same level as the last two years under her predecessor, Republican Frank Murkowski, state records show.

Alaska’s capital budget is full of local projects because many local governments rely on state funding to meet basic needs. Most of Alaska is owned by the federal government, and only 25 municipalities levy a property tax, according to the state tax assessor’s office. The capital budget, therefore, is a grab bag of projects requested by communities through their state lawmakers.

Because 90% of the state’s revenue comes from the oil and gas industry, Alaska has been flush with cash in recent years. State coffers grew fatter still when Palin, with help from Democrats in the Legislature, increased taxes this year by billions on the energy industry.