A much larger injection of funds to state and local governments is what’s needed. Without hundreds of billions of additional funding, we risk a greater economic crisis, a prolonged public health emergency, and a worsening of inequality and misery.
In seemingly never-ending waves of bad economic news, the economic shocks caused by the pandemic are pounding state and local budgets. Calls are growing for a federal bailout, up to $500 billion by some estimates. Mayors and governors are like characters in the movie “Jerry McGuire,” saying to the federal government, “show me the money!”
Unlike the federal government, states (and the cities they charter and oversee) can’t run deficits. We are now deep into annual budget seasons for cities and states, and the pandemic’s effects are driving revenue forecasts—and budget plans—sharply downward. The majority of states start their new fiscal year on July 1, and the bad news is hitting them hard. Essential services—garbage pickup, emergency medical services, police, public education, and health care—all are threatened.
Forbes
by Richard McGahey
Apr 17, 2020