The Portland Press Herald / The Maine Sunday Telegram

February 21

Governors brace for more economic hardship ahead

The Associated Press

WASHINGTON – On the recession's front lines, governors are struggling to chart the road ahead for states staggered by unrelenting joblessness and cut-to-the-bone budgets even as Washington reports signs of economic growth.

''The worst probably is yet to come,'' warned Gov. Jim Douglas, R-Vt., chairman of the National Governors Association, at the group's meeting Saturday. He called the situation ''fairly poor'' in most states, adding that it ''doesn't look too good.''

Such uncertainty weighed heavily over the governors' weekend meeting even though health care -- and how states can address skyrocketing costs -- was the intended focus. That's recognized as one of the biggest issues affecting states' long-term solvency.

As the meeting opened, first lady Michelle Obama sought governors' help in her campaign to tackle childhood obesity, although she acknowledged, ''I know that many of you are stretched thinner than ever in these times and don't actually have money to spare.''

States face budget holes totaling $134 billion over the next three years, according to the governors, who explained that tax collections keep declining as Medicaid costs soar.

There seemed to be unanimous agreement that job creation was the key to recovery in states.