We think our cutbacks are bad? Look at California.

California Governor Arnold Schwarzenegger holds a news conference on 1 DecemberIn 1978 California began a radical experiment when it passed proposition 13, which slashed property tax. It began a landslide of  moronic votes whereby the public voted to increase spending on stuff without raising the revenue to pay for it. 

This, coupled with gerrymandering of constituencies meaning that it is almost impossible for a sitting state assembly man to lose his or her seat,  a requirement that 66% of the assembly vote for a budget, and the fact that a proportion of spending is fixed by the state constitution  has left the state on the verge of bankruptcy.  

See this article from columnist George Skelton in the Los Angeles Times.