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The National Governors Association says that states face the "most dire fiscal situation (fiscal stress) since World War II" (Cauchon, 2003). The continual diminish of the federal government's role in state and local affairs is reducing the amount of federal grant-in-aid to state and local governments, this is to be tied with additional cuts from the Bush administration. According to the most recent surveys of state fiscal conditions, the sum of reported state budget deficits for the 50 states exceeds $100 billion, an amount equal to about 14 percent of current spending levels. Many elected officials state that because of the fiscal problems that are currently being faced by state and local governments there will be layoffs of thousands of employees and cuts made to key programs such as education, health care, road construction, and other essential government services...
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