I imagine that state budgets all over are in trouble, not just in Colorado. But I noticed this interesting poll on a local newspaper's website:

As the state looks at budget cuts, what do you think should be top on the list?

State employees

Salaries

Transportation

Public schools

Higher education

Medicaid

Prisons

Other ( please specify in comments)

In other words, they only ask about cutting services that people like. They don't have an option for "Government should cut out the fat, corruption, etc."
I know someone who works for the state university system. They are facing layoffs because of the state budget crisis. But every year they've spent extravagantly, such as on the newest and best flat screen monitors. This friend was allowed to take home one of the flat screens they were getting rid of, and it was really nice.
In other words, just in the one example I know of, state university spending, they're a whole lot of wasteful spending. Why don't they cut that before they lay people off?