U.S. Governors seek $1trillion assistence from federal government

This amount, equal to 3 – 3.5% of the economy, to aid the country’s 50 states to help pay for education, welfare and infrastructure as states struggle with steep budget deficits amid a deepening recession.

Gov. David Paterson of New York said 43 states now have budget deficits totaling some $100 billion as tax revenues plunge.

The latest package calls for $350 billion to create jobs by building or repairing roads, bridges and other public works; $250 billion to maintain education; and another $250 billion in “counter-cyclical” spending such as extending unemployment benefits and food stamps, which are typically a responsibility of the states.

The remainder would be used to fund middle-class tax cuts, stimulate the embattled housing market, and stem the tide of home foreclosures through a loan-modification program.

“The Obama team has been very receptive in listening to us,” said Gov. Jim Doyle of Wisconsin. He said “quite a number” of other governors back the initiative.

The Republican Governors Association, however, said the level of federal aid being sought would create a burden for the future.

Paterson of New York said his state’s budget deficit has surged to $15.4 billion currently from $5 billion in April 2008, despite a 3.2 percent cut in the education budget.

Corzine said the money called for represents about 3 percent to 3.5 percent of the economy.

In light of the $700 billion provided to bail out the financial industry, “It’s not shockingly large,” he said.

http://www.reuters.com/article/newsOne/idUSTRE5014F120090102

US home prices fall at depression pace

Dec. 23, 08 (Bloomberg) — Sales prices for existing U.S. homes fell the most on record in November 08.

The median resale price fell 13 percent from a year 07 before, to $181,300, “probably the largest price decline since the Great Depression”.

“November sales just collapsed,”

President-elect Barack Obama on Dec. 13, 08 said he will develop plans to limit foreclosures and “dramatically increase the number of families who can stay in their homes.”

One tenth of U.S. families who own a home are in financial distress, Obama said.