Brighter Futures Begin with HOPE.

The recent Associated Press article published in the Hattiesburg American, “Economy gets a lift from government aid,” highlighted the positive effect of government spending on the nation’s fledgling economic growth. It cites that much of the 0.5 percent income rise in the month of August was due to recently extended unemployment benefits. Construction spending was propped up by state and local government projects, many funded by federal stimulus funds. Total construction spending was up 0.4 percent in August, but private construction declined 0.9 percent.

In Mississippi, in addition to providing jobs through construction projects and extended aid for families through unemployment benefits, federal stimulus funds have helped mitigate some of the successive rounds of state budget cuts. The positive effects of these programs multiply as the state pays employees, contractors, and vendors who, in turn, spend their earnings in their local economies.

However, even with stimulus funds, cuts have been made and essential state services, like education, are hurting. During budget hearings in September, education officials reported reductions in the number of teachers and teaching assistants of 1,500 positions—not including reductions due to retirement. As a result, class sizes are increasing and recent gains in education quality throughout the state are threatened.

The state budget picture is even bleaker when you consider that most federal stimulus funds will end during this budget year. The budget cliff we will face next year is projected to be unprecedented. A cuts-only approach to solving the budget crisis not only hurts the quality and accessibility of state services, it also hurts the economy. A balanced approach that includes raising revenue is necessary to maintain the critical investments in areas, like education and workforce development, that are vital to the state’s recovery.