• http://www.youtube.com/user/apwucommunications?blend=18&ob=0

Over the last two years, the private sector grew at an average annual rate of 3.2 percent, while the government shrank at an annual rate of 1.4 percent.The combined result has been economic growth of 2.3 percent. David Leonhardt, Economix NYT January 27. 2011.

+3.2% average

-1/4% average

January 29, 2012, 9:20 Paul Krugman Destructive Austerity, USA

National Strikes in Belgium 1 30 11

Efficiency of state government• But voters have

positive views toward their state government.

• They say their state government is efficient by 55% to 43%.

7Conducted by Douglas E. Schoen, LLC for the Manhattan Institute

STATE BUDGET CRISES – WHO IS TO BLAME?

8

As you may know, many U.S. state governments are facing large budget deficits this year, meaning that their spending has exceeded the amount of revenue that they have brought in from fees and taxes. This has caused many public employee pension plans and healthcare plans to be greatly underfunded. What would you say is the main reason for these problems?

Elected state officials made careless and self-serving decisions 48%

State governments spent too much money 28%

Public employees’ benefits are too high and unsustainable 13%

State governments did not tax enough 6%

A plurality (48%) blame their elected officials for their state’s budget deficit.

Conducted by Douglas E. Schoen, LLC for the Manhattan Institute8

STATE & LOCAL GOV FUNDS – CUT SOCIAL SERVICE PROGRAMS?

• Voters would also not be willing to have state social service programs cut so that the salaries and benefits of current public employees could be paid at current levels if states did not have the money to pay them, 51% to 36%.

9

36%

51%

20%

25%

30%

35%

40%

45%

50%

55%

If states didn't have enoughmoney to pay the salaries and

benefits of current publicemployees, would you be willing

to have state programs cut sothat they could be paid at

current levels?

Yes

No

Conducted by Douglas E. Schoen, LLC for the Manhattan Institute9

STATE & LOCAL GOV FUNDS – RAISE TAXES BY PARTY

10

Democrats Republicans Independents0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

43%

14%

37%

47%

84%

50%

If states did not have enough money to pay current public employees’ salaries and benefits…

Willing to have taxes raised so that benefits could be paid at current levels

Not willing to have taxes raised

Conducted by Douglas E. Schoen, LLC for the Manhattan Institute10

STATE BUDGET CRISES – BEST SOLUTION

11

In your opinion, what is the best way to address the problem of states not being able to afford public employee benefits?

Cut government spending 47%

Require current public employees to contribute more towards their benefits

31%

Raise taxes 13%

Require retired public employees to contribute more towards their benefits

1%

A plurality (47%) say that cutting government spending is the best way to address the problem of states not being able to afford public employee benefits.

Conducted by Douglas E. Schoen, LLC for the Manhattan Institute11