Kansas in the New Millennium
George W. Bush was elected President in the 2000 election in a very close and controversial vote that was not decided until a month after election day. Democrat Al Gore won the popular vote by several hundred thousand, but the election was so close in the electoral college that the outcome of the race depended on the returns from Florida. Democrats alleged that some counties in Florida had confusing ballots and that many votes had not been properly counted. Further, the contested counties had a high population of black voters who historically had voted Democrat. Since the Florida election had ended in a virtual tie, the Democrats wanted a recount in some counties. However, deadlines mandated by election laws apparently did not leave enough time for recounts. The Florida secretary of state certified the election and named Bush the winner. Democrats appealed to the Florida Supreme Court, whose members favored a recount. Republicans took the case to the United States Supreme Court, whose majority ruled that Florida election laws should be followed. Florida?s returns were allowed to stand, and Bush became the new president.
A economic recession hit the United States during 2001 and 2002. The recession also affected the Kansas economy as overall civilian employment fell. Layoffs were common among technology and manufacturing companies. Unemployment was 4.3 percent in Kansas in 2001 and was expected to rise to 4.8 percent in 2002. Retail trade revenues and employment declined in 2001. A slight increase was forecast in this sector for 2002.
The economic downturn caused a large shortfall in state government revenues for the second half of 2001 and 2002. This shortfall resulted in a contentious legislative session during the first half of 2002 as legislators wrestled with the need to cut services or raise taxes to balance the budget for 2002. Governor Graves proposed a budget with an increase of more than $252 million in taxes to offset the reduced revenues and prevent major cuts in services, particularly in education. After much debate and a special session, a budget was passed with some tax increases and reduced services. Despite the budget crisis, a multimillion dollar renovation of the Capitol building was begun.
Democrat Kathleen Sebelius became the second woman elected governor of Kansas in the 2002 election. Although 2003 saw a slight improvement in the Kansas economy, the state's revenues continued to fall below expenditures. The legislature was forced to make cuts in higher education and other social service funding to balance the budget. The K-12 public school finance formula became an issue as many districts were hit by large decreases in state funding. Some districts sought more funding from local taxes and legislators began considering changes to the formula.
In June of 2005 in a lawsuit brought before the Kansas State Supreme Court, the court ruled that funding for public schools in Kansas was inadequate and the funding formula inadequately addressed the needs of districts with large numbers of low-income students. The Court directed the Kansas legislature to review the funding formula and increase funding for public schools. The court stated that funding for the schools needed to be increased by more than $800 million dollars as recommended by a study done previously at the legislature's request. The court ruled that funding for the 2005-06 school year needed to be increased by $235 million dollars and over the next couple of years by an additional $490 million dollars.
In a special session in the spring of 2005 the legislature reworked the funding formula and approved an increase of $290 in funding for the 2005-06 school year. The following year the legislature approved additional funding of $466 million dollars to be phased in over three years. Based on this action the State Supreme Court decided the legislature had met its demands and dismissed the lawsuit.
Senator Barack Obama from Illinois was selected the Democratic nominee for President in the 2008 election. He defeated the Republican candidate, John McCain, in the general election to become the 44th President. Obama was the first African-American elected President. Following the election, Governor Kathleen Sebelius was chosen by Obama to become Secretary of Health and Human Services. Lieutenant Governor Mark Parkinson then succeeded Sebelius as the new Governor of Kansas.
Towards the end of 2007 a mortgage crisis threatened the financial services industry. Because thousands of mortgages had been sold to unqualified buyers the secondary market for mortgages collapsed, housing prices fell and banks were faced with billions in loans that could not be collected. Major banks and other financial services companies faced insolvency and thousands of families faced foreclosure. The United States government stepped in to provide billions in financing for the largest banks and financial services companies while many other companies were forced into bankruptcy. The crisis caused consumer spending to collapse in 2008 and all sectors of business were faced with declining sales and revenue. As a result many business were forced to lay off workers and the economy was further weakened. Particularly hard hit were the major domestic automakers. General Motors required billions in government money to survive and Chrysler was sold to the Italian automaker FIAT. In 2009 the U.S. Congress passed the American Recovery and Reinvestment Act, which provided almost $800 billion dollars in funds to help strengthen the economy.
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