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In this crisis, states should get a lot of federal money

Steve Chapman on

There's also something cockeyed about trying to save money by sacking public employees who would then qualify for unemployment insurance, food stamps and even Medicaid. They would continue to cost the states money, but they would no longer do their jobs.

Federal Reserve Chairman Jerome Powell noted Tuesday the dangers of austerity during a recession. "We have the evidence of the global financial crisis and the years afterward, where state and local government layoffs and lack of hiring did weigh on growth," he told a Senate committee.

Brookings Institution scholar Mark Muro writes, "Only massive federal aid to states and localities -- to the tune of $700 billion to $1 trillion over the next 18 months -- will be sufficient to blunt the coming service cuts and layoffs as well as keep regional fiscal contractions from deepening the crisis and slowing the recovery."

Republicans worry that any aid could be diverted to cover pension liabilities. Illinois Senate President Don Harmon, a Democrat, asked the federal government for $10 billion to shore up the state's underfunded retirement system. His proposal, however, went nowhere.

The fact that improvident states would love Washington to make up for their mistakes doesn't mean it should deny help for problems they didn't create. Sen. Mitt Romney, R-Utah, tried to awaken his colleagues with a chart titled, "Blue states aren't the only ones who are screwed." Of the eight states facing the biggest funding shortfalls, six voted for Trump and have legislatures controlled by the GOP.

It shouldn't be hard for Congress to devise a formula that channels funds to states according to the relative severity of the pandemic and its economic fallout. The point is not to reward or punish states for their past fiscal practices. It's to alleviate the damage, giving more help to the states that have suffered the most.

 

A national catastrophe is not the time for Washington to treat some states and cities as though they deserve to suffer. It's a time for it to join with every state against a common foe.

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Steve Chapman blogs at http://www.chicagotribune.com/news/opinion/chapman. Follow him on Twitter @SteveChapman13 or at https://www.facebook.com/stevechapman13. To find out more about Steve Chapman and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

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