Why does it seem that when Arizona leads the nation, it’s always for the wrong reasons? The collapsing housing market has claimed another victim- the Arizona state budget: [Thanks L!]
Lots of states are facing severe budget problems. But only Arizona can say that its problems are the very worst.
The National Conference of State Legislatures released a survey today indicating that Arizona faces a budget deficit representing 24.2 percent of its general fund, easily outpacing No. 2 New York, which faces mere 20 percent reductions.
Rounding out the field of aneurysm-inducing budgets are California (18 percent), Wisconsin (17.2 percent), Minnesota (14.7 percent) and Kansas (14.5 percent).
"While the data we collected from state legislative fiscal officers are pretty sobering, our discussions with legislative leaders tell us that they expect the problem to only get worse," said William T. Pound, NCSL’s executive director, in a total Debbie Downer of a press release.
Of course, the rest of the states have to deal with the national economy as well, but they haven’t managed to come in dead last. You don’t suppose the the state government has mismanaged the budget, do you?
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As I have said before, full-blown Depression in Phoenix and Tucson. A couple more years of this, and new, never occupied homes will be bulldozed. But not enough of them.
And of course, there is no bottom in sight for Valley of the Sun housing. Not 2009, not 2010.
The failing state revenue stream is merely a nasty symptom of the problem … real problem is an overdependence on housing and tourism as an engine of economic development.
Surak, if you want to chat about Phoenix, send an email to Twist- she has my real email, and permission to send it to you.
I went to the University of Michigan during the 1970s. Despite the fact that the auto industry was already in trouble, I didn’t see any meaningful attempts to diversify the state economy. The hope was that the auto industry would somehow come back and everyone would be saved.
We know how that worked out.
Fast-forward to the present. I’ve lived in Arizona for 21 years, and, once again, I see little in the way of meaningful attempts to diversify the state economy. This, despite the fact that we have abundant sunshine and, thus, we could have a thriving solar energy industry. Not to mention the attention that’s now being paid to water conservation. We could be a world leader in that field as well.
Like Igor, I am confused.
slim,
my wife constantly asks me “why isn’t this state littered with solar fields?” all i can tell her is “i don’t know?”
i agree, igor…..it’s “dumb”
Az, Agree.. “Littered with solar fields”…. Any detail I have yet to find is that in the 70′s it was tested, then due to polotical motivations, the growing tech field (aka: honeywell, motorola etc) more people came to live and work and vacation. So Housing & tourism remain the mainstay focus. and Janet Napalitano did not take one the REIC, as a sidenote.
Slim, the 70′s were filled with prophecy after prophecy of the impending doom of the manufacturing sector. The whole auto industry is such a joke. Really bad management and labor can only hold themselves to blame. Arizon and Nevada both can lay claim to the least sophisticated economies. You can only play so much golf and look at only so much breast implantation before it gets kind of old. Now Texas, that’s a different story. Great vegetation, booming oil wells, cows in the back yards, etc.
24%! Wow. I knew it was bad – and have been amazed at the near complete silence as other states take (or at least talk about) active measures to address their shortfall. But I didn’t know it was this bad. Will the AZ Republic carry a headline story on this tomorrow. Doubt it!
And how about the 37,000 job losses here in November. Has there EVER been a month with such a loss (adjusted for population) in this state’s history? Doubt it! Will this story receive the coverage it deserves? Doubt it!
I’m starting to think we have a political-media-business establishment that truly can’t see bad news for what it is. I mean it seems people are unable to deal with this, recognize this. It’s like it can’t be computed.
37,000 jobs in one month. Now certainly the actual number is much higher. You can receive no more than $240 a week for benefits here — few I know in higher salary ranges bother to go through the paperwork and the DMV-like experience for that. The actual figure is higher.
Now what is the total official job loss for the trailing four months? I seem to recall reading the state lost 25,000 jobs in August. Are we down a 100,000 in the past four or five months?
What will this do to the housing market? This is a transplant state — will some return home? Will the population actually drop? What does this do for housing?
It’s amazing. What is happening here is now worse than I ever expected. (I exepceted greater price drops than this, but not this early in the cyle.) We have a long way to go yet! Very long.
Yossarian,
I gave Twist permission to give you my e-mail. Yes, I would be interested in hearing about Phoenix/Arizona
Thanks