Dec. 19 (Bloomberg) — New Jersey Governor Chris Christie said U.S. states face a “day of reckoning” as they contend with looming budget deficits in the wake of the longest recession since the 1930s.
Christie, who cut $1.3 billion in aid to schools and municipalities this year to close a $10.7 billion deficit, said states’ pension and debt costs have grown to be “unsustainable.” Benefits, education and health care will be reduced in many states, he said.
“The day of reckoning has arrived, that’s it. And it’s going to arrive everywhere,” Christie, 48, a first-term Republican, said during an interview on CBS Corp.’s “60 Minutes” program. Areas such as education and pensions “were third rails of politics. We are now left with no alternatives.”
The recession caused the biggest nationwide decline in state tax receipts on record, according to the nonpartisan Center on Budget and Policy Priorities in Washington. States have filled more than $425 billion in funding gaps since fiscal 2009; the combined imbalance is likely to reach $140 billion in the next budget year, the center said.