Now comes the hard part, making the unpopular spending cuts.  The hundreds of billions of dollars that was shipped out to states to keep them afloat last year is drying up and as budget makers plan for 2011 they are falling short, way short.  It’s impossible to truly measure the effect of the stimulus package but it appears that in many areas it became nothing more than a stopgap solution.  Instead of stopping the bleeding to allow for recovery to begin it appears that it just prolonged the inevitable.

Without federal stimulus money, states are scrambling to pay for big budget items such as education and medicaid.  This means that many jobs are likely to be lost unless something drastic is done and done quickly.  It is estimated that the stimulus package saved 300,000 jobs in the field of education.  Once the federal government is no longer picking up the tab almost all of those jobs, 275,000 of them could be cut.

I’m of two minds on this issue.  I don’t think that cuts in education are a good thing but if states believe that they can achieve the same results by trimming fat, then these are jobs that should have been shed previously to save money.  While the last thing we needed last year was for more people to lose their jobs, this year isn’t exactly any better.  Without stimulus money, states would have been forced to make unpopular decisions and work on balancing their budgets last year. 

I’m not about to suggest what should be cut and what should be saved – that’s why we pay our lawmakers big salaries, we expect them to make the hard decisions.  Every American has had to learn the hard way that we can’t spend more money than we make.  That’s why so many people have had houses foreclosed and bill collectors calling.  The government needs to make the same decision that we can’t borrow our way out of trouble until the next economic boom. 

Of course we haven’t learned our lesson.  There is already talk about sending more money to states so that they don’t have to make the necessary cuts.  This will only teach states that they don’t need to make unpopular decisions and that the federal government will bail them out. 

I’ll be interested to see how this plays out in the coming months.  State budgets have different deadlines but Congress is not going to want to touch this issue until after the November elections.  Any kind of second stimulus is going to give Republicans ammunition to use against what they will categorize as wasteful spending by democrats.