Chicago's huge budget shortfall tied to national economic crisis:

With huge budget shortfall, city layoffs loom

Top mayoral aides have been meeting privately with union leaders to prepare them for the loud noise they'll hear this week, when Mayor Daley lowers the budget boom.

Daley's preliminary 2009 budget is expected to include the largest shortfall in recent memory -- more than $400 million, according to some sources -- setting the stage for service cuts, employee layoffs, unpaid furlough days or a combination of the three.

With expenses rising, real estate transfer taxes plummeting and sales taxes down as strapped consumers cut spending, painful budget cuts appear to be the only alternative. Other cities and states are facing equally painful choices.

"Food prices go up. Gas prices go up. And expenses go up. The dollar is losing value continually. We are in a serious financial crisis in America. I keep saying that. People look at it and, maybe, dismiss it. But, I think we're in a much more serious financial crisis than people . . . believe. It's gonna have a long effect on this economy," Daley said Friday.

Two thousand city managers earning more than $75,000 a year will be required to take three unpaid furlough days by Dec. 31 to help ease Chicago's worst budget crisis in decades under a mayoral plan to be presented today before a City Council committee.

The Finance Committee is expected to approve Mayor Daley's $3 million furlough plan, triggering a period of shared sacrifice that's certain to extend to the city's unionized employees.