Report
The COVID-19 pandemic and the revenues of state and local governments: An update
Abstract
This report provides estimates of the revenue shortfalls state and local governments are likely to experience due to the COVID-19 pandemic. Our estimates apply to the 2021 fiscal year, which extends from the third quarter of 2020 through the second quarter of 2021 in most states. Nationally, we estimate that state governments’ sales and income taxes will fall short of January projections by roughly $105 billion. Combined shortfalls in all state and local government revenue streams are likely to be on the order of $240 billion for the current fiscal year.
The COVID-19 pandemic and the revenues of state and local governments: An update
Leonard Stephen Feinman
The Pandemic will be costly enough that it will take years to recover, but if done properly, should be smooth. Presently, we are allowing only the debt we know we can repay, but it is keeping our economy going.
If we continue the “buy American” trend when Covid finally ends, jobs will be restored. Many people will have gone into a limited debt, knowing they will recover as well. And all of this should stimulate the banks, which will lend that money and cause their growth as well.
Every country is equally sharing the losses. As always, the very richest of the richest will still remain rich because they started with more and did not lose as much. That idea works its way to a personal level as well. Certain industries have always led the way, and near the top has always been the auto industry. They rely on the steel industry, and we already have the infrastructure ready for a head start. We are ahead of the game, but we need to remain on track.