Throwing numbers around: $500 million

How big is the real hole in the state budget, and the problem state leaders really have to solve? Senator Williams is right that the hole is less than the $1 billion drop in revenue, but I think it's still pretty large.

Here are the very round numbers I'm thinking about:

• $1 billion missing from revenue assumed in 2008.
• +$200 million added in new costs from health benefits and other troubles.
• -$400 million from the stimulus fiscal stabilization.
• -$300 million in revenue and savings that will repeat from the 2009 legislature's work.
• $500 million as the real hole that requires further action.
  

I had to add some assumptions there. Kentucky will receive $650 million in stabilization money for two years, and that's spending more than half of it in the first of those years. The state plugged a $456 million hole in this year's budget, and that's assuming that about two thirds of those efforts will work again. And the $200 million in new costs rounds off a Page One report that they've sourced to Senator Williams' staff.

Taking $500 million out of general fund spending, if that's what's ahead, will involve serious losses in services to current Kentuckians and investment in future strength.