From: CNNMoney: 10 states face financial peril

By Daniel at 11 November, 2009, 5:16 pm

http://money.cnn.com/2009/11/11/news/economy/states_economies/index.htm

But the economic downturn is greater than administration officials expected when the Recovery Act was passed in February, Lav said. That’s why more assistance is needed now.

Budget projections show that states could face deficits as large as $260 billion in 2011 and 2012 after stimulus funding is exhausted. State economies usually take up to two years longer to recover after the nation’s fiscal health begins to improve.

New budget cuts and tax increases “will be a serious drag on the economy at just the wrong time,” said Mark Zandi, chief economist at Moody’s Economy.com.

Without assistance, the economy could slide back into a recession, he said. To top of page