Photo: An early morning outside the Opera Tavern in Stockholm, with a gang of beggars waiting for delivery of the scraps from the previous day. Sweden
While Washington and New York are home to the worst outbreak clusters, Illinois, New Jersey and Kentucky are among the states worst positioned to weather the financial contagion resulting from COVID-19.These states have suffered decades of financial mismanagement, and now face high fixed costs, budget deficits and large public debt burdens. Because these states are at acute risk, state leaders should take action to shore up state finances as soon as possible. The Illinois Policy Institute is recommending that Illinois institutes targeted tax relief to save jobs. Under our plan, the state would mandate that all local governments delay the collection of one of this year’s property tax installment payments until Oct. 1 for businesses to help cope with lost revenue and prevent layoffs. Illinois and other fiscally troubled states with massive debt burdens should also pursue preventive action to reform their pension systems, which could face an economic shock in the fallout from the COVID-19 pandemic.