This can’t be good. The Los Angeles school district is targeting 2,290 teachers for layoff. Given Governor Otter’s plan to cut $75 million for the state budget, it is clear that Idaho teachers face similar prospects.
Why is this happening? Well, as Paul Krugman pointed out in a recent column, state governors are responding to our economic crisis like 50 Herbert Hoovers
But even as Washington tries to rescue the economy, the nation will be reeling from the actions of 50 Herbert Hoovers — state governors who are slashing spending in a time of recession, often at the expense both of their most vulnerable constituents and of the nation’s economic future.
Although many governors, like Butch Otter, are ideological libertarians for whom government is always the problem not the solution, the truth is state governments have little choice when faced with an economic crisis. Again, according to Krugman,
The answer, of course, is that state and local government revenues are plunging along with the economy — and unlike the federal government, lower-level governments can’t borrow their way through the crisis. Partly that’s because these governments, unlike the feds, are subject to balanced-budget rules. But even if they weren’t, running temporary deficits would be difficult. Investors, driven by fear, are refusing to buy anything except federal debt, and those states that can borrow at all are being forced to pay punitive interest rates.
Yes, Keynesian economic policy is not an option for Governor Otter. He must balance the budget even though to do so is likely to exacerbate the problem. Hear that sound? It’s the social safety net being shredded.