Texas Is In Financial Trouble

Our incompetent governor, Rick Perry, would like for Texans to believe that this state has not been hit hard by the recession -- not as hard as the rest of the nation. He's so confidant in the Texas economy that he's even turned down federal money meant to help our schools.

But if the recession hasn't hit Texas hard, then the governor has a lot of talking to do to explain the situation the state finds itself in. According to a spokesman for the Texas Legislative Budget Board, the state will be between $11 billion and $15 billion short of what will be required just to maintain the current level of services. Any new spending authorized will push the deficit even higher.

The governor has already asked all state agencies to cut their budgets by 5%, but that won't even come close to cover the impending deficit. That would only save $1.7 billion. The reason for the huge shortfall is a huge drop in sales tax revenues.

For over a year now, the sales tax revenues have been off by double digits over the same period the year before. And it may be a long time before those tax revenues recover. Some saw February's tax revenues as a good sign, because they were only off about 9% instead of double digits. I think they're fooling themselves.

The tax revenues won't recover until the joblessness is ended, and that could be years (especially if the off-shoring of jobs is allowed to continue unabated). There is no magic bullet to raise sales tax revenues. People that don't have jobs, or have minimum wage jobs, cannot spend money they don't have.

I expect the Republicans will continue to cut services for regular folks, because raising taxes on the rich or stopping government giveaways to corporations is anathema to them. The citizens will continue to suffer while the rich and the corporations get richer, because that's the Republican way.

For Texans, the future looks pretty dim.