Colorado’s economic soothsayers just rang the alarm bell—recession odds now sit at a gut-wrenching 50%—and they blamed it all on “uncertainty” from Washington. Funny thing is, Colorado itself is the one inviting uncertainty in its own budget room by treating spending like an all-you-can-eat buffet. Let’s tear into why Colorado doesn’t have a revenue problem—it has a spending problem, and why Gov. Polis should take a page from Congress’s austerity playbook.
Follow along as I provide a few enumerated thoughts:
1. State Spending Has Gone Off the Rails
When Polis first rolled into the governor’s mansion in January 2019, the FY 2019–20 General Fund appropriation was $12.2 billion (leg.colorado.gov). Fast-forward to FY 2023–24, and core General Fund spending has ballooned to roughly $16.0 billion—that’s a 31% increase in just four years, or about an 8% annual growth rate, far outpacing Colorado’s own personal-income growth (apps.urban.org). Meanwhile, the Joint Budget Committee is penciling in $17.9 billion for FY 2025–26 before considering any real cuts. If you’re scratching your head wondering why recession odds are climbing, here’s your answer: spending growth is sprinting, but revenue growth is jogging at best.
2. Bureaucratic Bloat: Workforce Numbers Are Exploding
Colorado’s state workforce has grown right alongside that spending spree. As of December 2024, there were 150,500 state government employees (not counting county, municipal, or school district staff)—up from about 125,000 in early 2019, a 20% jump in headcount (commonsenseinstituteus.org). That’s tens of thousands of additional desks to fill, benefits to fund, and pensions to guarantee—all on your tax dollars. Meanwhile, businesses are tightening their belts, yet Colorado keeps hiring more hands for government service.
3. New Programs Galore: Bill-Signing Frenzy
If there’s a mouse-hole for a new program, Polis’ pen has already scrawled the memo. He signed 519 bills in 2024 alone—the most annual bill-signings in over a decade—up from 502 in 2019 (kunc.org). Assuming a similar volume in 2020 and 2021, we’re looking at 2,500+ new laws since he took office, each spawning its own grants, pilot projects, compliance offices, task forces, or “stakeholder workgroups.” Want to study artisanal goat yoga on state time? Don’t be surprised if there’s already a footnote in last year’s Long Bill allocating funds for it.
4. Colorado’s Business Climate—From Darling to Dud
Remember when Forbes ranked Colorado 9th best for business back in late 2019? Now only 32% of Colorado businesses say the economy is on the right track, while 67% think it’s heading south (forbes.com). Site selectors and entrepreneurs have never been less enthused. Between rising regulations, soaring costs, and snail-paced permitting, firms are voting with their feet, not good news for a state that once proudly touted its innovation aura.
5. Regulation Overkill Strangles Growth
Colorado’s red-tape mountain keeps growing. A 10% uptick in industry-specific regulations correlates with nearly 9,000 fewer firms and 36,000 fewer jobs, according to a recent Colorado Chamber of Commerce impact study (cochamber.com). And between 2020 and 2023, regulations jumped 7.1%—another paperwork layer for pipeline transport, personal services, and small-business owners to drown in. More pages of rules doesn’t mean a better state; it means less nimble, less competitive, and more prone to recession risk.
6. The “Uncertainty” They Keep Yapping About…
Legislative Council Chief Economist Elizabeth Ramey and OSPB’s Bryce Cooke point to tariff anxiety, consumer-debt at 20-year highs, slowing retail sales, and an aging population as recession catalysts . But you know what piles on uncertainty faster than foreign policy? A state budget where spending rockets skyward while reserves crater. Colorado’s rainy-day stash is forecast to tumble below statutory minimums every year through 2027—meanwhile Congress is eyeballing $900 million–$2.5 billion in annual spending cuts on entitlements and open-ended programs .
7. It’s Not a Revenue Problem—It’s Polity’s Spending
Tax collections have grown in line with—or even a hair above—Colorado’s economy. Yet rather than living within its means, the state funnels every extra dollar into more programs, more hires, and more regulations. Your grocery bill is climbing, rent is climbing, and now insurance premiums are climbing because everyone’s fees get marked up to cover these cost overruns.
8. Congress Shows How It’s Done—Colorado Should Take Notes
That federal budget reconciliation bill may be a political football, but it’s also a scalpel cutting excess. If D.C. can dial back $1 billion here, rescind open-ended health subsidies there, and still balance competing priorities—why can’t Colorado slash a few dozen duplicate programs, freeze non-essential hiring, and roll back the worst regulatory chokeholds?
My Bottom Line
Colorado’s economic outlook is grim not because revenue is drying up but because spending is galloping out of control. Until Gov. Polis and the legislature swap virtue-signaling for fiscal discipline—until they stop adding desks, programs, and red tape without ever trimming the fat—Colorado will keep flirting with recession, hemorrhaging its business appeal, and draining its rainy-day fund. It’s time for real budget austerity: cut the damn fat, live within your means, and let innovation thrive under true market pressures—choice over coercion, every time.
