Unambiguously Good News

For the first time since the 3^rd quarter of 2008, State tax receipts rose in the 1^st quarter of 2010.

The obvious bit of good news here is that increasing tax revenues means that there is more hiring (income tax) and buying (sales tax), but there is another significant effect.

49 states, all of them but Vermont, are required by their constitution to run balanced budgets, and what this has meant is that the state governments have had to act like 49 little Hoovers, cutting budgets and staffing in the midst of the worst downturn since the great depression.

The turnaround in tax revenue means that the spending cuts can stop, which removes a drag to those state's economies created by budgetary retrenchment as well.