"My job used to be a lot more fun."

That comment, from state economist Pearl Imada Iboshi, summed up the mood Tuesday when legislators heard a rather stark and gloomy assessment of Hawai'i's and the nation's economic outlook.

Last week, the Council on Revenues issued a forecast that downgraded revenue growth projections for the current and next fiscal years as compared to the panel's previous predictions in October.

The new projection put Gov. Linda Lingle and legislators on notice that an additional $250 million will have to be sliced from state spending over the next 18 months.

On Tuesday, the council's chairman, University of Hawai'i economist Carl Bonham and Iboshi laid out just how bad the situation is.

Using dozens of Powerpoint slides, the three top financial analysts told a joint hearing of the House Finance and Senate Ways and Means committees that statistics tracking employment levels, construction starts, tax revenues, personal income growth and — most importantly — tourism are all headed downward.

Democratic Rep. Marcus Oshiro of Wahiawa-Poamoho, chairman of the House committee, called the presentation "sobering."

"It just means we have to work through what might be the largest, deepest recession that Hawai'i has ever faced," he told The Associated Press.

Paul Brewbaker, the council's chairman, took the least pessimistic view of the near future, saying that while the panel believes state revenues will decline by 3 percent during the current fiscal year that ends on June 30, he thinks that will be just about the worst of it.

For one, cheaper airline tickets may attract more tourists to the state than expected.

But Bonham, executive director of the university's Economic Research Organization, said he still believes airline tickets have not come down far enough to impact declining tourism in the next few months.

Bonham even went so far as to describe what is happening to tourism in Hawai'i as "carnage." California's economic calamity is a leading cause of the drop in tourists traveling to Hawai'i, he added, calling it "Hawai'i's Achilles heel."

Similar economic woes in China, Japan and elsewhere also are affecting tourism, Bonham said.

As a result, significant job cuts are likely to occur soon in Hawai'i's hospitality and retail sectors.

"We think the other shoe is about to drop," he said. Unemployment in Hawai'i is lower than that on the Mainland but it is "deteriorating at about the same rate, which is kind of scary."

In her presentation, Iboshi noted that passenger arrivals via cruise ship are down by more than 20 percent and that personal income in Hawai'i and the nation has been steadily falling since mid-2006.

The economists pointed to one benefit of the recession — very low rates of inflation. But Brewbaker said there are few plausible scenarios in which the council's declining revenue projections will turn out to be too pessimistic.

And he added that no one should be surprised if the council in March decides that revenue growth is dropping even more than they think it is now.

For his part, Bonham harkened back 75 years to the last economic upheaval of this scope. Foreclosures and job losses are tearing families apart and will leave a heavy impression on its victims, much like the Great Depression did to Americans who lived through it, he said.

"That has the potential of changing attitudes for a very long time," he said.

The economists did suggest that whatever economic stimulus plan is approved by Congress and the incoming Obama administration is likely to mitigate the downturn. And in later years, Honolulu's 20-mile rail transit project may stimulate more jobs and spending.

But those plans are either too vague or too far off to help the current situation, they said.

Meanwhile, Lingle spokesman Russell Pang said even tax increases are on the table during budget discussions between the governor and legislators. Lingle has steadfastly opposed tax hikes in the past, saying they would hurt, not help, economic growth.

Pang reiterated that Lingle has not changed her position on taxes, just that she is willing to discuss "everything."