State revenue crises, continued: Deficits as far as the eye can see

Steve Perry//June 12, 2009

To underscore the closing words of state economist Tom Stinson in our interview with him a couple of days ago, here’s a mind-numbling graphic (h/t Baseline Scenario) on the revenue crunch that US states are projected to face in the coming years. It suggests many additional rounds of absolute fiscal anguish at the Legislature, some of which could make this year’s cuts look relatively pain-free in retrospect.

No wonder, as Charley Shaw wrote here last week, the National Governors Association has joined the rising number of organizations who say tax increases are inevitable. But it’s pretty clear they won’t be able to fill a gap this size.

The graph below is based on national numbers–not Minnesota-specific.

The graph above is from "Assessing the State and Local Sector: Where Will the Money Come From?," a presentation by Donald Boyd of the Rockefeller Institute that was given last month at a meeting of the Federal Reserve Bank of Chicago.