Nevada: stimulus vs. budget cuts test case

Watching Meet the Press this morning, it occurred to me that Nevada may be shaping up as a very interesting test case for the deficit spending versus budget cutting debate with the added benefit of pitting Harry Reid's support for the stimulus against John Ensign's deficit hawkishness.

Here's a paraphrase of Ensign's remarks on state aid from about the 2 minute mark of the video:

To get back to what Congressman Frank said -- we're going to be laying off teachers, firefighters, etc. -- that's just fear-mongering. We're not going to be doing any of that in the states...The state budgets over the last 15 or so years have grown faster than population growth and inflation. The state budgets are bloated, the federal budget is bloated. We should be cutting back. This bill just sends money to the states. Instead, we should be requiring states to make the tough decisions to cut spending.

Meanwhile, as reported in the LA Times, Nevada faces the largest budget shortfall of any state: 

Nevada is facing the most serious shortfall, with a 38% gap; California's 22% gap is the fourth-worst, behind Arizona at 28% and New York at 24%, according to the National Conference of State Legislatures.

At the same time, of course, aid to states is one of the contested areas of the Senate stimulus bill. While Senator Reid's position is predictably in favor of state aid, Senator Ensign is taking the fiscal hawk line that state budgets are bloated and in need of cutting.

The Center on Budget Policies and Priorities reports:

Nevada’s governor proposed cutting funding for state universities and colleges by 36 percent compared to the state’s prior budget.

No doubt governors and legislators in many states face difficult decisions. The interesting question politically, it seems to me, is how voters will respond to these positions and Nevada may provide a provocative test case going into 2010 and 2012. Stay tuned.