Informant38

"Nearly every state is in fiscal crisis," the governors said in a new survey of the states.

Raymond C. Scheppach, executive director of governors association, said the problems would affect people across the country. States, he said, are increasing tuition at public colleges and universities, cutting Medicaid eligibility and benefits, increasing taxes on individuals and corporations and laying off state employees.

"You will see huge cuts in Medicaid," Mr. Scheppach predicted.

Medicaid and other health costs, like employee health benefits, account for 30 percent of state spending and grew last year by 13 percent, the largest rate of increase in a decade, the report said. At a time when revenues are declining, Mr. Scheppach said, such growth is unaffordable and unsustainable.

Relatively few of the newly elected governors have said precisely how they will deal with these fiscal problems. "Most of them don't understand how bad it is," Mr. Scheppach said.