Will Arizona Senators Bail Out Free-Spending Blue States?

kelly sinema
Sens. Mark Kelly and Kyrsten Sinema dutifully posed with their vaccine records in D.C. on December 18, 2021. [Photo via Twitter]

Democrats have spent the last few months demanding bailouts for states and local governments,” GOP Senator Rick Scott said in a National Review opinion piece last December. “They claim that if you oppose spending hundreds of billions of taxpayer dollars to bail out states such as New York, Illinois, and California, then you support laying off teachers, health-care workers, and first responders.”

(I read that, and I said to myself “Hey, that’s exactly what the Tucson City Council says all the time!  They spend the money they do have on silly projects [or lawsuit settlements], then claim they don’t have enough money for police and schools!”)

Early Saturday morning, around 2AM, the House of Representatives passed a nearly 2 trillion dollar spending package.  $350 billion of that is targeted for state and local governments.  The primary reason is COVID relief.  And, to be fair, many states and localities do need some relief.  COVID has been a disaster, and the federal government has the most resources for disaster relief.

But, can we be sure that the money…or to be more precise, our money, will go to COVID relief?  Or will some states use it to pay other bills they’ve run up, recently and over the past few decades?  The federal government “shouldn’t write blank checks to poorly managed states,” says Senator Scott.  Then he lays out some reasons for his concerns.

“[W]e don’t even know how much of the $1 trillion allocated to states and local governments by the CARES Act [a $2.2. trillion COVID relief bill passed and signed into law last year] has already been spent,” the senator says. “I and Senator Ron Johnson (R., Wis.), have written multiple letters to every governor in America asking for a breakdown of how they’ve spent their states’ CARES Act money. Just ten of them have responded. Only in Washington does it make sense to consider sending hundreds of billions of taxpayer dollars to states and local governments that refuse to tell us how, or even if, they’ve used the $1 trillion we sent them nine months ago.”

“Second of all, unemployment data show that states that have taken steps to responsibly and safely open up their economies are doing better than states that refuse to accept reality and science and stick with unnecessarily strict, destructive lockdowns. Thirty states have halved their unemployment rate since May while real GDP grew 33 percent in the third quarter, erasing losses from the previous quarter.”

“States have the option to get their economies open and improve their fiscal situations without relying on the federal government for a bailout. Some are just choosing not to,” said the senator.  (Emphasis added). States can “moderate the economic harm caused by the COVID pandemic through reasoned, balanced measures that protect citizens without destroying their economies. States also have taxing authority and the ability to borrow money if their fiscal situations get too dire.”

“Lastly, and most importantly, state revenues are up! States across the country are seeing a significant increase in revenue — in some cases, well above projections. As the Wall Street Journal reported, California’s revenue for this fiscal year is almost $10 billion above projections, while New York’s revenue increased more than 4 percent from September of 2019 to September of 2020.”  In other words, many states already have revenue they can use to pay their short-term bills.  Instead, expect many to use federal relief money to pay those short-term bills (like COVID relief support), and then try to use their own state revenues to refill pension fund coffers, pay for high-speed rail projects, or a whole host of other projects they’ve foolishly pursued.

“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.”

“All this is to say that states do not need bailouts,” said Senator Scott. “[T]hey want bailouts so they can use the money—intended to address the fallout from COVID—to plug the long-standing holes in their budgets and pension systems.  It’s as simple as that.”

Fortunately, there is a simple solution.  This relief bill can’t pass without a majority vote in the Senate.  The Biden White House and Congressional Democrats apparently plan to use a process called “reconciliation” to pass this.  A reconciliation can’t be stopped with a filibuster, so it only needs 51 votes to pass.

There are only 50 Democrat Senators.  Almost all, if not all, GOP Senators oppose this bill. This bill might pass with only 50 votes, with Vice President Harris breaking the tie.

That means that, literally, one or two Senators have the power to stop the worst spending in this bill.  The relief bill’s supporters probably can’t afford to lose a single vote. That gives each individual Senator much more leverage than they would have in deliberating and modifying a more-routine bill. That also increases the personal responsibility each and every Senator has if a bad bill passes.

Arizona has two Democrat Senators, who represent a purple state. One of them is up for reelection next year.  They represent a state where thousands of people have moved to in recent years, in order to escape horribly-managed blue states—-California and Illinois, for example.

If this bill passes, especially on a 50-50 or 51-49 margin,  and is written in such a way that it enables spendthrift states and localities to use our money to pay the debts created by their bad fiscal behavior, then we can honestly say that Kyrsten Sinema and Mark Kelly signed the bailout check for the spendthrift states.  A check which our grandchildren will pay, because we’ll have to borrow the money to cover that check.

Our Senators must ensure they are not letting our grandchildrens’ money be used to bail out bad fiscal actors.  By all means, the federal government should provide needed relief.  But the spendthrifts in state and local government, red or blue, should not be able to take advantage of this pandemic to pay for past boondoggles.  We are counting on our Senators to individually and personally prevent that from happening—which, in this case, in this closely-divided a Senate, they can.

P.S: This thought might cross your mind: “Wait a minute!  If the Senate DID bail out blue states, wouldn’t a bunch of Democrat Senators lose reelection in 2022?”  Yes, they might.  But some of these blue states—California, New York, Illinois—have huge budget problems NOW.  This COVID relief bill might be their last best chance to get the federal government to pay millions, even billions of our dollars to cover their bills.  If Senators from New York, California or Illinois had to choose between possibly keeping the Senate majority in 2023, or definitely fixing a lot of their state’s fiscal woes right now—don’t be surprise if they take the money.

https://www.nationalreview.com/2020/12/republicans-must-not-cave-on-blue-state-bailouts/

https://www.bls.gov/web/laus/lauhsthl.htm

https://www.bea.gov/data/gdp/gross-domestic-product

https://www.wsj.com/articles/state-tax-revenue-rebound-11605568517?mod=opinion_lead_pos3

https://www.nytimes.com/2020/04/17/business/dealbook/illinois-pension-coronavirus.html

About Donald Smith 15 Articles
Donald Smith wrote the “Fort Buckley” blog on TucsonCitizen.com from 2011 to 2012. He lives in Tucson.