State Budgets

Jonathan Williams and Lee Schalk: States Should Not Seek Federal Bailout

In their latest op-ed in The Hill, ALEC Executive Vice President of Policy and Chief Economist Jonathan Williams and Center for State Fiscal Reform Senior Director Lee Schalk explain why states should think twice before seeking federal funds to fill budget gaps during the pandemic.

Whenever you send one group a bailout, another group must foot the bill. In this case, those groups are actually one and the same: State taxpayers are also federal taxpayers. In short, bailing out states with federal tax dollars is akin to using your American Express card to pay off your Visa.

Make no mistake: State and local governments do not lack revenue. They lack spending restraint. Over the past 40 years, after fully accounting for increases in population and inflation, state and local direct general spending has grown by 88 percent. Despite one of the longest economic booms in American history, states have also continued accumulating debt and unfunded public pension obligations.

Read the entire op-ed in The Hill.


In Depth: State Budgets

Smart budgeting is vital to a state’s financial health. The ALEC State Budget Reform Toolkit offers more than 20 policy ideas for addressing today’s shortfalls in a forthright manner, without resorting to budget gimmicks or damaging tax increases. One way to stabilize budgets over time is to embrace …

+ State Budgets In Depth