It has been stated that the reason for the hugh budget deficit in California and other US states this year is that the vast majority of these states income comes from personal income tax.

It seems these states had budgets that depended on the total taxes collected to continue to rise as it did during the dotcom rush. I guess its not so simple for them to just roll their budgets back to the 1998 levels.

pf

>>2) which in turn benefits society in terms of higher taxes paid,
>
>Really? I don't think so (at least not in Canada or the U.S.).
>- fewer workers results in less personal income taxes being paid;
>- fewer workers results in less space needed to house that staff, resulting in less local taxes for realty and the like;
>- most companies pay very very little in the way of taxes while many corporations are huge beneficiaries of "corporate welfare".
>
>>3) higher salaries and bonus' for those still employed in the company,
>
>That used to be so. But now (as I've mentioned at least twice in thread in CHATTER forum) DEFLATION is the watchword of the day. Wages are going DOWN, not up, as profits remain stable or rise (but not 'enough').
>But it is true that the EXECUTIVE DO GIVE THEMSELVES NICE BIG BONUSES.