‘Fiscal Meltdown’ for States Exaggerated, Group Says
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Predictions of an “imminent fiscal meltdown” among U.S. states and municipalities are exaggerated and create “unnecessary alarm” for policy makers, the Center on Budget and Policy Priorities said in a report.
The operating deficits most states are forecasting for fiscal 2012 are the result of the post-recessionary weak economy and have been erroneously conflated with longer-term issues such as debt, pension obligations and retiree health costs, Iris J. Lav, senior adviser at the Washington research group, and Elizabeth McNichol, a senior fellow, said in the report today.