Feeling the crunch
To the editor:
Michiganders are feeling the cash crunch of shelter-in-place orders. Many are out of work, and many businesses are feeling the pain acutely. Our state budget is feeling the pinch, and so are many other states. Governors have started asking Washington, D.C. for “unrestricted aid,” but let’s call this what it is: a bailout. This would be unfair.
An unrestricted bailout to states would force taxpayers in well-run states to pick up the tab for states that have failed to fund their pensions and rainy day funds. If states can tap federal revenues in times of crisis, it allows them pass the buck from state taxpayers to federal taxpayers and avoid their balanced budget requirements which exist in almost all states.
It’s no wonder Gov. Cuomo is so desperate for the federal government to bail him out: New York’s rainy day fund is one of the lowest in the nation, and the state owes over $450 billion in unfunded pension and post-employment benefits.
State bailouts would reward fiscal mismanagement and is entirely unfair to states that have managed budgets well over the years. Michigan should say no.
Editor’s note: According to a story that appeared in U.S. News, New York, based on 2018 data, gave the federal government $22 billion more than it received in tax funds.
Combined with New Jersey, Massachusetts, and Connecticut, all traditionally known as “Blue States,” the total given in taxes was in excess of $50 billion.
The same article stated that states such as Kentucky, West Virginia, Mississippi, and Alabama, all traditionally known as “Red States” were the among those that receive higher numbers of federal spending as they contribute much lower amounts in income taxes each year.