January 27, 2010

The Shadow Budget

  • Paul Bachman

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Mercatus scholars host a series of interviews with with policy scholars, elected officials and other practitioners about state and local legislative and regulatory reforms.

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Massachusetts like most states grappled with a significant decline in revenue (2.5 billion in MA) in 2009. Despite efforts by way of  spending cuts and tax increases to create a sustainable 2010 budget in Massachusetts, there is still a 600 billion gap.  In reaction to this volatile cycle, the Beacon Hill Institute has put forth recommendations in their recent publication “Massachusetts Fiscal Policy: The Legend v. the Facts” on how states can move away from relying on forecasting tax revenues, which are unstable in recessions and economic downturns, and enact reforms to eliminate a structural deficit.

Joining us to talk about this project is Paul Bachman, Director of Research for the Beacon Hill Institute. Mr. Bachman shares how the Institute conducted this research project and offers specific recommendations that all states can enact to cure these budget woes.