State government news site Stateline takes a close look at Washington State's latest budget crisis; in September the state's economic forecaster Arun Raha said he expected a $1.4 billion shortfall in revenues to hit the $32 billion 2011-13 biennium budget that legislators just passed in May. (That budget already  cut $4.5 billion to deal with previous groaning shortfalls.)

The Stateline piece, noting that Washington State's shortfalls are more serious—as a percentage of spending—than other states, identifies some key problems: 1) Washington doesn't have an income tax ("What ails Washington most is that its tax structure is poorly suited for the kind of predicament it faces now...") ; 2) the sales tax approach to the construction industry is having an outsized effect; and 3) regulations on  business. (They cite the new green construction standards, which strikes me as more of a job creator.)

It's certainly odd to blame Washington State for putting the kibosh on business growth when the article also notes that Microsoft and Boeing are "doing just fine."

Although speaking of Boeing,  here's a bit of a jolt consider; Stateline notes:

The congressional “Super Committee” [in DC] has shown little sign that it can agree to $1.2 trillion in domestic spending cuts, raising the likelihood of automatic trigger cuts in defense that could hit Washington, a military-dependent state, very hard.