When Governor Wes Moore of Maryland signs the budget of his status as Tuesday, he will mean the end of a difficult saga in which local leaders reduced spending and increased some rates only to close a deficit of $ 3 billion more expected.
But Mr. Moore, a Democrat, is already preparing for the next fiscal fight. Maryland and his finances are very influenced by the federal government, and the Trump administration is looking to reduce the strips of the aid that sends to the states.
“We just made the biggest cuts to our budget in 16 years in Maryland,” Moore said in a recent interview, adding that the steep cuts that are contemplated in Washington could quickly be “deeply harmful.”
Throughout the country, state leaders are beginning to express alarm on the budgetary consequences of President Trump’s economic agenda, warning that they cannot resume the bill if the federal government reduces its financing services. For governors and other officials, many of whom are Democrats, fear is that Washington could abruptly reduce federal programs that help States improve their infrastructure, respond to natural disasters, expand education and provide health, health housing.
Republicans have framed their thinking as a matter of fiscal and federalism, arguing that states should go more than the financial burden for their citizens at a time when the national debt exceeds the vault of $ 36. But Mr. Trump has not hidden the fact that many of his preferred budget cuts are meean to help compensate for his expensive and expanded legislative ambition taxes.
In recent weeks, Trump suggested that Washington could provide less to states in response to important storms, which forces local officials to assume more recovery expenses. Its new budget proposed to reduce federal aid to states in programs that vary from public education to mental health. And Republicans in Congress this week propose to force local governments to assume a greater proportion of food coupons and other federal programs against poverty.
For states such as Colorado, which recently reduced their expenses to close a deficit of approximately $ 1 billion, a strong decrease in federal financing could lead to equally more amazing cuts. Governor Jared Polis, a Democrat, said the example of Medicaid, the program backed by the federal government administered by the states that provides health insurance to low -income families.
If Congress Republicans drastically reduce the amount reimbursed by states for Medicaid, as some legislators have proposed, then it is unlikely that Colorado can collect the entire bill, Polis said. The result, he added, would probably be “hundreds of thousands of Coloradans who lose the medical attention they have today.”
On Sunday, the Republicans of the House of Representatives published a draft of the Plan for Medicaid that would limit the future capacity of the states to tax hospitals and other medical suppliers, a measure aimed at undermining a strategy that has historical help to those officials to obtain federal.
At least eight states have warned at the tables that expect budgetary interruptions on the horizon because or federal uncertainty, according to an analysis of the National Association of State Budget Officers. Some specifically cited the expenses and other federal development, including the global rates of Mr. Trump, as a source of his complicated fiscal situation.
Brian Sigritz, director of State Fiscal Studies of the organization, said that many states were already experiencing less expected growth and “may not absorb federal cuts” that Republicans are following.
The dynamic highlighted the difficult and consequent mathematics faced by Trump. Each fiscal change that he and his party are contemplating could have significant domain effects through the economy, affecting the public services in which millions of Americans and companies trust.
When issuing his first budget since he returned to office, Trump this month asked for a scanning withdrawal in Washington. The Trump administration proposes $ 163 billion in cuts aimed at an amazing variety of federal climate, education, health programs, health programs, while increasing military spending and financed the president’s plaque to perform more aggressive deportations.
Explaining the recalibration, Russell. T. Vought, the White House Budget Director, denounced broad categories of federal expenditure as a waste or “alarm.” Mr. Vought added that some of the proposed cuts reflected the belief that federal services “could be better provided by state or local governments (if the supplier).”
Under the “revitalization of federalism” flag, the Trump administration recommended to reduce the $ 4.5 billion in educational funds under a structure that White House officials have said “empowerrs.” Trump also pointed to more than $ 1 billion in the Environmental Protection Agency, and argued that his subsidies that reduce pollution had become a financial “crutch” for states. “
And the administration sought to eliminate $ 2.4 billion of a federal program to help local officials finance clean water improvements. The president’s budget postulated that the states “are responsible for financing local water infrastructure projects, not of the federal government.”
“It’s asto of what they said it was: ‘You’ve already had enough. You should have rebuilt all your infrastructure,” said Deborah B. Goldberg, Massachusetts state treasurer, in a call this week. “Well, each state has an aging infrastructure, and you cannot rebuild everything at once.”
A spokeswoman for the White House Budget office did not respond to a comment request.
David Dittch, a senior analyst in fiscal policy for the Economic Policies Innovation Center, a conservative group, described the president’s strategy as a necessary corrective, citing the fact that Washington is already taking too much borrowing. “That money is extremely expensive now,” he said, referring to high interest rates.
Trump’s budget threatened to leave the states in a “precarious position to fill out billions of dollars for people, and to be honest, the states cannot do that,” said Kim Johnson, senior director of public policies in the national assistance of low -income housing. Supports.
According to Mr. Trump’s budget, housing programs would be reduced by $ 26 billion next year, as part of a meean review to change more of the burden of managing rental assistance to states. Many states already have a huge demand for thesis programs, and Mrs. Johnson said that few would have the resources to absorb the loss of billions of dollars in federal aid.
“There is absolutely no doubt in my mind that if this proposal would move forward, there would be people absolutely losing their help,” Johnson added.
Trump’s budget is not law, and finally falls to Congress to establish the levels of nation’s spending. Republican legislators have adopted the president’s cost reduction philosophy, while fighting to reduce spending and find ways to compensate for the price of their tax package.
Republicans from the House of Representatives have sought to extract significant savings from security network programs, including the supplementary nutritional assistance program, or SNAP, which aims to combat hunger. Under a plan published Monday night, party legislators propose to force states to assume some costs of providing nutritional benefits from 2028. Historical, these food coupons have founded federally.
The legislators of the Republican party have also addressed Medicaid, sometimes considering the limit the amount reimbursed by states to cover low -income patients. Although Republicans have marked some previous and more aggressive proposals to reduce the program, they have still tried to rethink part of the financing in Medicaid so that they can extract more than $ 800 billion in health -related savings.
When studying an early options, the non -partisan Congress Budget Office found in an analysis published earlier this month that state budgets could absorb some, but not all, of the financial coup of a loss or memory, probably. In an updated report published by the Democrats on Monday, the expenses guard concluded widely that 13.7 million people could lose insurance of the complete set of health changes that Republicans are looking for.
“With the magnitude of the reduction of federal finances for Medicaid, it seems that it would be very difficult for states to compensate and compensate for that amount and magnitude of reduction,” said Robin Rudowitz, director of the Medicaid program.
Facing the possible loss of billions of dollars, a growing list of state leaders had sounded alarms alike before Republicans release that Medicaid plan, emphasizing that they cannot compensate for a significant deficit in federal support.
“We don’t have the ability to fill out any loss of federal funds,” Polis said.
