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Governors Press Their Case for Economic Recovery Plan

President-elect Barack Obama met with state leaders at the National Governors Association conference Tuesday to help shape an economic recovery plan. A panel of governors describes how states are handling the financial downturn.

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  • JIM LEHRER:

    Judy Woodruff has our governors story.

  • JUDY WOODRUFF:

    In the historic Philadelphia hall where the Bill of Rights was ratified and the first congresses met, the nation's governors gathered to discuss the collapsing economy and their own fiscal crises with the incoming president and vice president.

    The head of the National Governors Association, Pennsylvania Democrat Ed Rendell, said he and his colleagues were there to ask for help, not handouts.

    GOV. ED RENDELL (D), Pennsylvania: And one of the newscasters said, "Today the governors are meeting with the president-elect in Philadelphia to beg for money." And, Mr. President-elect and Vice President-elect, that is definitely not why we are here.

    First of all, all of us realize our responsibility to deal with this financial crisis ourselves in our states.

  • JUDY WOODRUFF:

    Nevertheless, the states will be asking for billions, especially to help fund programs like Medicaid that are jointly administered with the federal government. They are also lobbying for unemployment and food stamp assistance.

    Vermont's Republican governor, Jim Douglas, outlined in stark terms how the crisis is affecting the states' bottom lines.

    GOV. JIM DOUGLAS (R), Vermont: It's estimated that about $30 billion in budget gaps exist currently. And by the end of the fiscal year, which is June 30 for most states, it will be around $60 billion.

    Because the states' fiscal crises generally lag the economic downturn of the country, that will increase during fiscal 2010, probably to the magnitude of another $120 billion. So we're looking at about $180 billion anticipated problem over a two-fiscal-year period.

  • JUDY WOODRUFF:

    Many states are prohibited by law from running budget deficits.

    Vice President-elect Joe Biden said the new administration wants to enact a recovery plan that would spend billions in federal dollars on infrastructure projects already under development by the states.

    The president-elect made a clear pitch for pragmatism.

    BARACK OBAMA, President-elect of the United States: We recognize that change is not going to come from Washington alone. It's going to come from all of you.

    It will come from a White House and state houses all across the country that are working together. And one of the messages that Joe and I want to continually send is that we are not going to be hampered by ideology in trying to get this country back on track.

    We want to figure out what works. That doesn't mean that we're not going to have some disagreements, but what it does mean is that, if you can show me something you are doing that's working or if you tell me that this program or this regulation is hampering us from doing smart things that will advance the interests of our state, then you're going to have a ready ear.

  • JUDY WOODRUFF:

    Following the meeting, some of the governors were Washington-bound to press their case for federal assistance.