Blue Bailout: Biden Plan Gives Billions to State/Local Governments

President Joe Biden's massive $1.9 trillion coronavirus relief plan not only includes $1,400 stimulus checks for most Americans, it also includes plenty of "stimulus" for government. The bill contains some $350 billion for state and local governments. Most of this money would go to Democrat-run states like California, New York, New Jersey and Illinois, which are in terrible financial shape due to years of poor management exacerbated by their own pandemic lockdowns of the past year.

Of course, all of this "stimulus" has to be paid for by taxpayers, who are already facing higher taxes under a Biden Administration. Dr. Vance Ginn, chief economist with the Texas Public Policy Foundation, says it's fundamentally unfair. "California, New York, Illinois, all have massive budget shortfalls, and they've been having shortfalls for a long time because of their excessive spending," he says. "Whereas you have states like Texas, which has done a much better job fiscally."

"There's really no reason why Texas should be funding, really subsidizing, other states' poorly managed financial situations."

In particular, Ginn points out Texas has balanced its budget and kept billions in surplus, and is set to do so again this year. "We're not going to have to raise any taxes or fees or anything else, and just practice fiscal restraint," he says. "We need that same sanity in D.C. and across the nation."

Aside from being unfair, he believes these state and local bailouts are simply wrong on principle. "This is an issue of federalism," says Ginn. "The states should really keep their own fiscal house in order, and not be reliant on redistributed dollars from other states."

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