Most state budgets are an absolute mess. Only two states, Montana and North Dakota, are not confronting serious budget deficits in fiscal year 2010 despite the fact that 49 states have balanced budget constitutional requirements.

• California, the world's eighth largest economy, has an obscene 49 percent budget gap amounting to $45.5 billion. Despite a contentious effort in Sacramento to close that gap, the deficit in California continues to grow.

• Across the border in Arizona, they are staring down a 41 percent budget gap amounting to $4 billion.

• On the East Coast, New Jersey has a 30% budget gap coupled with the highest property taxes in the country and a state judicial system that mandates funding levels for education.

• Meanwhile in the Midwest, Illinois has a 47 percent gap coupled with a corrupt budgeting process and growing unfunded pension liabilities.

These massive gaps are the result of an over reliance on inflated housing values for tax revenue and a political need to spend every dollar that comes in, no matter how wasteful. Now that revenue reality has set in with the popping of the housing bubble, many politicians are calling for more growth-killing taxes. Frantic spending in good times followed by tax increases during the bottom of the business cycle is known as “boom-and-bust budgeting.” It is unprincipled, transparently political, and makes for a difficult business growth environment.

Boom-and-bust budgeting also makes it more difficult for those concerned about realistic, planned budgets from making necessary cuts during an economic downturn. Budget cuts are shouted down with cynical appeals to "health," "safety" and the "well-being" of our children. But there is no excuse for government spending that far exceeds population growth and inflation. California is an excellent example. The state's population has grown 18 percent since 1992, while state spending rose an inflation-adjusted 62 percent over the same period. The state debt situation is even worse: California's debt is now 105 percent higher than its 1992 total.

Unfortunately, many academic and policy sources perpetuate this unhealthy bias against spending cuts. For example, the recently published Pew Center on the States report entitled "Beyond California: States in Fiscal Peril" gages the budget situation by measuring a state’s change in revenue over the past year and the size of the current budget gap. They provide no indication of the history and pattern of spending in the state. Huge drops in tax revenues are, of course, a significant part of the current state budget crisis. But shouldn't a history of reckless, unchecked, corrupt spending be part of the discussion? Doesn't spending that far outstrips population growth and inflation mean that massive waste is going on?

That spending was only possible thanks to the government-supported housing bubble. Surely we shouldn't base our spending decisions on the results of an artificial price increase created through economically misguided government programs. We need to be vigilant and hold our state politicians accountable for their reckless spending and their callous disregard for the stewardship of our hard-earned tax dollars.

Carl Oberg is a Policy Associate at Americans for Prosperity.