Against a Federal Bailout: State Budget Resources

Report Budget and Spending

Against a Federal Bailout: State Budget Resources

February 28, 2003 9 min read
The Heritage Foundation

State capitals are busy with lawmakers working to eliminate red ink: 31 states must fill a combined $17.5 billion budget gap before June 30, according to the National Conference of State Legislatures. Rather than encourage them to reform their budgets and reduce costs, Senator Thomas Daschle (D-SD) has proposed a $40 billion federal bailout to prop up state spending. Because it would lead to higher federal taxes, this bailout would not save taxpayers any money. Furthermore, it would encourage the same overspending that created these crises. It would be better to practice spending discipline and allow low taxes to aid economic growth, which will in turn help balance state budgets.

State governments have wisely concluded that their constituents should be spared higher state taxes, but the bailout solution would simply raise federal taxes instead. Taxpayers do not care whether they mail their taxes to Washington or their state capital; they care about their total tax burden and whether they are getting their money's worth. Congress should forget accounting gimmicks and cost shifting. It is time for all levels of government to take responsibility for their budgets and reduce excessive spending.
-- Brian Riedl in The Case Against a Federal Bailout of the States

American Legislative Exchange Council
"Should the Feds Bail Out the States?"
Contact ALEC at (Order #0303)

Goldwater Institute

  1. 42 Ideas for a Free and Prosperouos Arizona

Pacific Research Institute for Public Policy

  1. California by the Numbers

Georgia Public Policy Foundation

  1. We Need Axes, Not Taxes
  2. Good Government on a Tight Budget
  3. Good Government on a Tight Budget: Education

Public Interest Institute

  1. How Iowa Government Can Reduce Spending
  2. Iowa's State Budget: Spending Our Way to a Crisis

Pioneer Institute for Public Policy Research

  1. Agenda for Leadership 2002

Mackinac Center for Public Policy

  1. Proposed Budget Reductions for the Michigan Department of Agriculture
  2. Recommedations to Strengthen Civil Society and Balance Michigan's State Budget
  3. Prevailing Wage Repeal Would Save State $400 Million Annually

North Carolina
John Locke Foundation

  1. Alternative Budget For North Carollina
  2. 2002 Briefing Book sections on:

Buckeye Institute for Public Policy Solutions

  1. Grinding to a Halt

Cascade Policy Institute

  1. Oregon Budgeting 101
  2. Repeal Little Davis-Bacon
  3. Cutting the budget? Cut corporate welfare
  4. First, look at school spending
  5. School finance: It's Not a Revenue Problem
  6. Prohibition's over, the OLCC should go now

Texas Conservative Coalition Reseaerch Institute

  1. A Roadmap to Responsible Reform

Thomas Jefferson Institute for Public Policy

  1. Competitive State Government in a Time of Uncertainty

Evergreen Freedom Foundation

  1. Determining Government's Core Functions
  2. School Construction: Building a better schoolhouse

Washington Policy Center

  1. A Policy Guide for Budget Reform Strategies for Improving State Government Services and Reducing the Deficit



The Heritage Foundation