Rising oil prices could trample prospects for economic recovery in many states, three governors warned on Sunday, as a leading economist said they also threaten the country’s economic comeback.
“Oil prices — I hope don’t go any higher,” said Indiana Governor Mitch Daniels, a possible contender for the Republican presidential nomination in 2012. “But everywhere now one hears there’s more than a minor risk they’re going to go a lot higher.”
So could laying off tens of thousands of teachers and other state employees. It may reduce expenditures in the short term, but it will also reduce revenues in the short and long term.