In Greece, Prime Minister George Papandreou won a vote in Parliament for additional austerity measures. In the U.S Congress, with the August 2 debt default approaching, House Majority Leader Eric Cantor and Senator Jon Kyl walked out of U.S budget negotiations. In California, Controller John Chiang decided to withhold state legislators' pay for each day they fail to send a balanced budget to Governor Jerry Brown after missing a June 15 deadline. In New Jersey, Governor Chris Christi and the legislature are moving forward with plans for substantially higher health insurance contributions from state workers. In New York, Governor Andrew Cuomo has told the state employee unions how much money needs to saved and has threatened layoffs if an agreement is not reached.
MY TAKE: Unfortunately, the economic response to many stimulus efforts has been muted. Now, as government entities, both large and small, struggle with budget gaps, high health care expenses and pension obligations; we are moving into the “no pain, no gain” stage of the economic cycle. Some efforts will succeed and others will fail. While this stage of the “recovery” may be protracted and painful, at least we are moving forward.