Principles for an equitable recovery

Principles for an equitable recovery

The Covid-19 pandemic and ensuing economic fallout have hit black and brown communities harder than their white neighbors. Entrenched racial inequities have left people of color facing higher death rates due to the virus, higher unemployment rates due to Covid-19-related job loss and higher representation in essential jobs that put them at greater risk for exposure and infection. Louisiana lawmakers have an opportunity to counter the underlying causes of the racial inequities by enacting a state budget and policies that promote racial equity. Erica Williams and Cortney Sanders of the Center on Budget and Policy Priorities outline three guiding principles for an equitable recovery: 

 

  • Target aid to those most in need due to the Covid-19 and consequent economic crises.
  • Advance anti-racist and equitable policies — both short- and long-term — to dismantle persistent racial, gender, and economic inequities and other barriers that non-dominant groups and identities experience.
  • Protect state finances to preserve the foundations of long-term economic growth and opportunity.

 

 

How low can state revenues go?
Initial projections for state budget shortfalls amid the Covid-19 pandemic are among the most dire in modern times — and new analysis suggests that even these projections underestimate the scale of the problem, with soaring unemployment and cratering sales tax creating a grim picture for state finances. Michael Leachman of the Center on Budget and Policy Priorities has the numbers on what’s required to bridge the shortfall: 

Federal aid that policymakers provided in earlier COVID-19 packages isn’t nearly enough. Only about $65 billion is readily available to narrow state budget shortfalls. Treasury Department guidance now says that states may use some of the aid in the CARES Act of March to cover payroll costs for public safety and public health workers, but it’s unclear how much of state shortfalls that might cover; existing aid likely won’t cover much more than $100 billion of state shortfalls, leaving nearly $665 billion unaddressed. States hold $75 billion in their rainy day funds, a historically high amount but far too little to meet the unprecedented challenge they face. And, even if states use all of it to cover their shortfalls, that still leaves them about $600 billion short.

A new report by Gary Wagner of the University of Louisiana at Lafayette details Louisiana’s economic forecast. Kristen Mosbrucker of Nola.com | The Advocate has the highlights: 

More than 600,000 people in Louisiana filed for unemployment between March 21 and May 9. The April state unemployment rate might exceed 30%, according to the forecast. Statewide unemployment during the second quarter, which includes April, May and June, is expected to average 18%. The gross domestic product in Louisiana is expected to drop by 20.5% during second-quarter this year compared to last year. That’s somewhat better than the national average, which expects a 32.2% drop in GDP. But the recovery is expected to take longer in Louisiana than the rest of nation, and GDP may not rebound to levels seen before the coronavirus until at least 2022, the report said.

 

Covid-19 in the rural South
Rural counties across the South are battling even higher rates of Covid-19 infection than New York City, when population size is taken into account. What’s to blame? According to Olivia Paschal of Facing South, the prisons and meat packing plants that were brought into rural communities as economic drivers that now fuel the virus’s spread. Unfortunately, as in urban areas, black people in rural counties have been harmed the most: 

While the counties with the most concentrated outbreaks are places with prisons, where states have undertaken vigorous testing efforts, counties with the highest death rates tell a different story. According to Facing South’s analysis, the three counties in the rural South with the highest COVID-19 death rates are all majority-black counties in Southwest Georgia, where the pandemic took an early and heavy toll. Louisiana’s Bienville Parish, which is more than 40 percent black, and Alabama’s Tallapoosa County, nearly 30 percent black, round out the five rural Southern counties with the highest COVID-19 death rates. 

 

New leadership for Louisiana public schools
Louisiana’s public schools have a new superintendent for the first time in more than eight years. The state Board of Elementary and Secondary Education picked Jefferson Parish superintendent Cade Brumley to replace John White, handing the reins to a leader who has broad support from teacher unions, school board members and local superintendents. Will Sentell of Nola.com | The Advocate has the story:  

Belinda Davis, one of the governor’s appointees, said Brumley was helped by some of the 7,500 public comments submitted to BESE about the next superintendent, including the need for an educator who has seen things from the ground level. Brumley is superintendent of the state’s largest school district, which includes 51,000 students and 82 schools. Last year voters in Jefferson Parish approved a 10-year property tax hike that raises about $29 million per year to boost pay for teachers and other employees. 

 

Number of the Day
87% – The share of U.S. wealth held by white households. (Source: Center on Budget and Policy Priorities analysis of Federal Reserve’s Survey of Consumer Finance.)