12/14: States haunted by scary budget scenarios

Stateline: States haunted by scary budget scenarios

Budgets in most states will be facing service cuts, tax hikes, IOUs, layoffs, furloughs and political gridlock. In Virginia, outgoing Gov. Tim Kaine is putting together a budget that his successor, Bob McDonnell, will have to finalize. Said Kaine, "The things that get put in front of me in terms of cuts are ... tougher and tougher, and somewhere in whittling down that $3.6 billion number, I know I am going to get a cut that I don't want to make."

Arkansas has seen worse budgets over the years, including the hit the state took in 1930 when a third of the state flooded -- it was already reeling from budget problems before the Great Depression. In 1933, Arkansas defaulted on its bonds — the only state to do so during the Great Depression — and its state government essentially functioned on federal money for two years. It started digging itself out only when it passed a sales tax, and even then, the state had to stop building roads for 16 years.

To avoid a repeat, state leaders will have to be strong and offer solid plans to weather the budget problems.

Also in the South:

ALABAMA: Some of the state's schools are still segregated, according to study

ARKANSAS: Crop losses in the state estimated at $309 million by economists

FLORIDA: Judicial Ethics Committee advises judged not to befriend attorneys on Facebook

GEORGIA: Savannah worried about Atlanta's water plans and impact on coast

KENTUCKY: Abuse statistics considered 'alarming' in Kentucky

LOUISIANA: Commission on Streamlining Government works on state expenses

MISSISSIPPI: Some legislators want to change the way the budget is written

NORTH CAROLINA: Asheville councilman's atheism causing a huge stir across nation

SOUTH CAROLINA: Gubernatorial candidates outline jobs programs

TENNESSEE: Opinion: It's time Tennessee slams jail door shut

VIRGINIA: Gov. Kaine prepares Virginia budget

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