Gray: It feels like country is in a 'depression'
Responding to news the District is facing a budget shortfall of $175 million, presumptive mayor-elect Vincent C. Gray (D) said it feels like the nation is in a "depression."
Gray's comment, made to about 200 business leaders gathered at the University of the District of Columbia, may not be the sort of message Democratic leaders are hoping to send in advance of the November midterm elections.
"People have been hesitant to call it a depression, but frankly the qualities and characteristics of it feel like a depression to me," Gray said at the UDC business forum.
On Monday, Chief Financial Officer Natwar Gandhi told Gray, chairman of the D.C. Council, and outgoing Mayor Adrian M. Fenty (D) they will have to work together to quickly close the shortfall in the fiscal year 2011 budget year that begins Friday.
Gandhi attributed the shortfall to overspending and a dip in sales and capital gains tax revenue. Since 2008, District leaders have been forced to make hundreds of millions of dollars in spending cuts and raise some taxes and fees to close several successive budget shortfalls.
Gandhi said the national economic woes are fueling the District's budget troubles, but added the local economy remains far stronger than many other parts of the country.
President Obama and Congressional Democrats have been stressing that the national economy is on rebounding, albeit slower than they had hoped.
The National Bureau of Economic Research said last week that recession technically ended in June 2009. The economic downturn never met the criteria for a depression.
| September 29, 2010; 12:20 PM ET
Categories: Budget, City Finances, Tim Craig
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