Capitol Comments

According to new data from the Census Bureau's Annual Survey of Public Employment and Payroll, state and local governments lost 203,321 jobs last year. John Lonski, chief economist for Moody's Capital Markets Research told Reuters that “we are looking at the worst contraction of state and local government employment since 1981.”

According to reports released today by the Bureau of Economic Analysis, national personal income increased by $42.4 billion – or 0.3% - in July compared to June. Personal consumption also went up in July, increasing by 0.8%. Growth rates in July were similar to those in June, when personal income increased $27.7 billion, or 0.2%, and personal consumption was up 0.1%.  Personal income was up 5% over July 2010.  

According to the Congressional Budget Office, the $825 billion stimulus law (ARRA) enacted in February 2009 has had a significant impact on the economy, including levels of employment. The CBO estimates that  ARRA’s policies had a number of effects in the second quarter of calendar year 2011, when compared with what would have occurred had the stimulus not passed, including an increase in GDP, a lower unemployment rate, an increase in the number of people employed and an increase in the number of jobs. 

On August 22, 1996, President Bill Clinton signed into law an historic overhaul of the country’s welfare programs. Fifteen years later, during one of the most prolonged economic downturns in U.S. history, some states are actually seeing declines in the number of their citizens accessing TANF - Temporary Assistance for Needy Families - which is the nation’s cash assistance program for poor families with children.

As the national unemployment rate hovers around 9.1% and with state unemployment rates as high as 12.9 percent, states are still struggling to pay out unemployment benefits. In September 2006, Michigan became the first state in recent history to borrow money from the federal government so that it could continue to send out unemployment checks. Now, 28 states plus the Virgin Islands are currently borrowing money and next month, many will have to start paying interest on those loans.  For most, the bill will be in the millions of dollars.  

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