The Blue State Rescue Plan... by David Catron

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The Blue State Rescue Plan

Democrats use pandemic relief as a pretext to redistribute wealth from red to blue states.

by David Catron
March 11, 2021, 12:22 AM


Wednesday afternoon, the Democratic majority in the House passed HR 1319. Variously marketed as a “pandemic relief bill,” an “economic stimulus package,” and the “American Rescue Plan,” it is largely a wealth transfer from well-managed and prosperous red states to incompetently managed blue states. A mere 9 percent of the legislation’s $1.9 trillion cost will be devoted to mitigating COVID-19, and about 12 percent will go to individuals in the form of stimulus checks and unemployment payments. The rest will go to blue state bailouts, funding for school systems that remain closed, kickbacks to unions, new subsidies for Obamacare, and exorbitant financing for innumerable pet progressive projects.

By far the worst of the bill’s provisions involves the $350 billion earmarked for blue states and their crumbling cities. The Democrats claim this spending is necessary to rescue them from budget shortfalls caused by the pandemic. But except for certain badly managed blue states, there is no real need for federal bailouts. The Cato Institute highlighted this reality in January: “State and local budgets are not in crisis.” The only Democrat to vote against HR 1319 on Wednesday, Rep. Jared Golden (D-Maine), echoed this point in February: “While some additional aid may be warranted, the $350 billion authorized by this bill far exceeds the actual budget gaps confronting states and localities.”

The Republicans have consistently made this same argument, of course. Sen. Joni Ernst (R-Iowa) put it as follows last week: “We have the good people of Iowa being asked to support blue state bailouts.” She went on to point out which states will receive the majority of the money: “Chuck Schumer’s state of New York and Nancy Pelosi’s state of California.” This comment was made pursuant to what the Republicans have dubbed the “Schumer substitute,” an 11th-hour amendment to the formula that determines which states get how much of the $350 billion. Senate Democrats changed the formula to reward badly mismanaged blue states. Sen. Marsha Blackburn (R-Tenn.) explains at Fox News:

Previous COVID relief was distributed to states based on population, which ensured a level playing field. For purely partisan reasons, this bill uses unemployment numbers to determine final state payouts and rewards failing blue states with the tax dollars of red states whose jobless rates didn’t spike as dramatically. Under this new formula, our home state of Tennessee will lose $164 million dollars; meanwhile, New York, New Jersey, and California will walk away with a combined gain of almost $9 billion.

more
https://spectator.org/covid-stimulus-blue-state-rescue-plan/