States drain unemployment trust funds (CNNMoney.com) and Maine voters deliver strong message on taxes (AP)

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City of Industry, CA --(www.USEquityNews.com)-- 11/10/2008 - Taxes industry alert provided by U.S. Equity News. State unemployment insurance trust funds are rapidly running out of money amid soaring job losses.This is prompting state officials to consider raising employer taxes or curtailing benefits, while forcing them to borrow from the federal government to cover claims.


"Some states didn't have adequate reserves built up," said Andrew Stettner, deputy director of the National Employment Law Project. "They are having significant problems paying out the increased number of benefits."The number of people collecting state unemployment benefits hit a 25-year high of 3.84 million, on a seasonally adjusted basis, the Labor Department said Thursday. The following day, the department announced that 240,000 jobs were lost in October, pushing the unemployment rate up to 6.5%, up from 6.1%. It's the highest rate since March 1994. Nearly 1.2 million jobs have been lost this year.With companies unveiling mass layoffs almost daily, states are likely to see further strains on their trust funds. [Read the full article]

PORTLAND, Maine (AP) -- After a couple of failed attempts, tax foes finally mustered a victory in a statewide referendum to rein in taxes in Maine.With the beverage tax abolished on Tuesday, voters next will likely face two more tax-related referendums on Election Day a year from now. For lawmakers, it's an ominous sign as they face a budget shortfall of at least $500 million for the coming two-year cycle.
Sen. Peter Mills, R-Cornville, said the tax repeal, along with the narrow victory for water bonds, serve as a scene-setter for the upcoming session."It sends a signal at this point that no form of (new) revenue is appropriate, and maybe that's the way to start this session right," he said. "It'll give the Democratic majority great pause in terms of raising taxes to get out of this box."Sen. Joe Perry, Taxation Committee co-chairman, agrees that there's a sense of foreboding following previous budget shortfalls that date to Gov. [Read the full article]

As my colleagues Pat Dorsey and Robert Johnson recently pointed out http://www.morningstar.com/cover/videocenter.html?bctid=1902595691&lineup=stocks, it is never a good idea to mix your personal politics with your personal investing decisions. The reason for that is quite practical; your ability to implement the policies that you support is nil and can be quite at odds with the economic and political reality that exists in Washington.

On the other hand, it is worth paying attention to the politics of the president-elect and the policies he plans on pushing when considering investments. With that in mind, we polled the Morningstar ETF team to find the best investment themes for new administration and the best ETFs to take advantage of those themes.Natural GasBoth candidates proposed providing billions of dollars for incentives toward clean energy development that would help America secure energy independence, but achieving such a lofty goal is decades away. [Read the full article]

SACRAMENTO, Calif. (AP) -- The nation's economic meltdown is taking state budgets down with it -- especially in California, where Gov. Arnold Schwarzenegger said Thursday he wants to close a $11.2 billion gap in part by raising sales taxes on everything from cars to Disneyland tickets.

Several other states are confronting billion-dollar deficits. Some, including Massachusetts, North Carolina and Wisconsin, have ordered broad and deep cuts in spending, while others have only begun to consider how to compensate for their revenue wells drying up.Schwarzenegger wants $4.5 billion in cuts; one of his proposals would force state employees to take a day off each month without pay and give up two holidays. But he says cuts alone aren't enough to deal with a steep drop in revenue, and he proposes $4.7 billion in tax hikes, including a three-year, 1.5-percentage-point increase in the sales tax."We have a dramatic situation here and it takes dramatic solutions ... [Read the full article]

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