Granholm Budget Woes

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State economists were told Tuesday that Michigan's economic recovery should peak in the spring of this year with four percent growth in the forecast. However a war in Iraq is a wild card that could skew that prediction.

Meanwhile Gov. Granholm says there is a hole in the current state budget, even though former Gov. Engler said he was giving her a balanced budget.

Because of declining revenues during November and December Granholm said, "That causes us to be in a dire situation this fiscal year."

That means she will have to either cut services or hope for the turnaround to pump more money into state coffers.