(AmericanProsperity.com) – Across the nation, states are on the frontline against the fight against COVID-19. However, businesses are closing and revenue is dropping, resulting in loss of jobs and contracting state economies due to lower tax collections. The states are certainly finding themselves in a difficult financial situation.
Unlike the federal government, states must maintain balanced budgets or have enough money in reserves to cover the cost of an economic downturn. That’s why they might be the major benefactors of future stimulus bills.
In The News: States Need Help From the Fed This Time (Bloomberg Opinion) https://t.co/DiTuWRdhMf
— AFR (@RealBankReform) March 19, 2020
With billions of dollars in state tax revenues disappearing overnight, governors will soon be financially struggling to provide basic services and meet the needs of communities struggling with the impact of COVID-19. State funds go to several important programs including state infrastructure, education and support services for low-income families.
As the federal government responds to the needs of workers and businesses, the governors of both parties are now asking President Trump and Congress to help them with billions of dollars in aid. In previous recessions and difficult financial times, the federal government all but ignored the needs of the states.
As the COVID-19 crisis grows and evolves, it’s going to be interesting to see how the states and federal government work together to solve the problem and return America to its status as an economic powerhouse.
~Here’s to Your Prosperity!
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