Update: Who Wants To Pay For Federal Bailouts?

dollar wallet

Editor’s Note: This opinion has been updated from the original work which ran on October 11th

Are you ready to spend billions of taxpayer dollars on federal bailouts? If Joe Biden wins the White House, and especially if the Democrats take the Senate, you’d better be ready. Democrats have plenty of things they want the American taxpayer to pay for.  If they take control in Washington come January, they’ll have access to The People’s checkbook.  You can bet they will use it.

“They want bailout money for Democrats that were in cities terribly.”  That’s a quote from the British newspaper The Independent of President Trump commenting in late July on bailout requests from American cities, cities run almost exclusively by Democrats.  (Presumably the president meant to say “in cities that are terribly governed.  Our president is known for passion, not precision, in his speech).  Trump said Portland, Seattle and other “Democrat-run” cities are “terribly run and they are always overtaxed.  They tax them too much and they run them poorly…And what the Democrats want are bailout funds.”

Some cities need money to pay for all the damage caused by the riots.  Minnesota’s governor asked the federal government for millions of dollars to help fix Minneapolis.  “The Minnesota Division of Homeland Security and Emergency Management conducted a virtual preliminary damage assessment (PDA) jointly with staff from FEMA,” wrote Governor Tim Walz in a July 2nd letter to President Trump, and “verified $15,658,865 of eligible damage related directly to the fires.”  President Trump denied that request.  “Great news! @realDonaldTrump has DENIED Minnesota’s disaster request to repair half a billion dollars in damage from the riots,” [South Carolina Congressman Jeff] Duncan tweeted. “Governors and Mayors who ordered police to stand down and watch their cities burn shouldn’t get a penny in taxpayer aid!”  Mark Levin’s response was more colorful: “[T]he Minneapolis city council votes to abolish its police department.  Pay for your own man-made hell!”

It is highly likely (to put it mildly) that President Joe Biden would be much more forgiving of Minneapolis’ and Minnesota’s lackadaisical—sorry, tolerant approach to stopping rioters.  And much more willing to write a big check, that will be paid with your money and mine.

The Democrats have other bills they want Washington to pay.  “Illinois Seeks A Bailout From Congress for Pensions and Cities,” was the headline for Mary Williams Walsh’s New York Times article of April 17th.  “Illinois needs more than $40 billion in relief from the federal government because of the coronavirus pandemic,” Wash writes, “including $10 billion to help bail out its beleaguered pension system, according to a letter the Illinois Senate president sent to members of Congress.”  Andrew Biggs, a pension expert at the American Enterprise Institute, who helped manage Puerto Rico’s bankruptcy, told the Washington Free Beacon that “a bailout for Illinois could break the dam of federal funding.  ‘If Illinois got money, then everybody’s going to ask for it, because all of these pensions have some level of funding problems.  I think this is the feeler to see what happens.”

“Staring down the coronavirus’ effect on their budgets, states like New Jersey and Illinois are calling on federal leaders to backstop public pensions,” wrote the Washington Free Beacon’s Charles Lehman on April 23rd.  “Democratic leaders in those states are pushing the federal government for billions in funding to shore up underfunded public pensions…some states now seeking bailouts are in part covering for more than a decade of economic mismanagement, having chased increasingly risky investments to fund generous benefits at low up-front costs.  Bailouts would allow states to dodge hard questions about the viability of excessively-generous public pensions.”

With Obamacare, Democrats showed that they are willing to ignore widespread public disapproval—and even risk losing future elections—in order to accomplish their goals.  (You have to admire discipline and dedication like that.)  They certainly know that, if they take control of Washington this coming January, and get control of the federal checkbook, this might be their best chance to pay off their outstanding bills, with our (and our children’s) money.  By the time the American people could rise in revolt, and turn many Democrats out of office in the 2022 midterm elections, they will already have spent our money.  And we’d have no way of getting it back.

Think about that as you vote.

Update:  The New York Times reported on October 1st that, in negotiations for a new COVID-19 stimulus bill, the Trump administration offered $250 billion for relief of states and municipalities—but the Democrats want $500 billion. 

            Reason magazine reported in September that many states may not be in as bad financial shape as they portray themselves to be.  “According to the National Association of State Budget Officers (NASBO), state revenue for fiscal year 2020 (which in most states ended on June 30) fell by about 3 percent from fiscal year 2019 levels.”  A 3 percent drop is bad, but it’s not a catastrophe. Reason writes that state and local officials should respond to the revenue shortfall by “reevaluating budgets to prioritize the important things and cutting where possible. Budget shortfalls can also push state officials to get creative by doing things they probably should have done a while ago.”











About Donald Smith 12 Articles
Donald Smith wrote the “Fort Buckley” blog on TucsonCitizen.com from 2011 to 2012. He lives in Tucson.