Fiscal stimulus, without the tax cuts

Fiscal stimulus, without the tax cuts

The far-reaching and critically-needed American Rescue Plan was signed into law by President Biden on Thursday. It will send billions in much needed aid to state and local governments, including about $5.2 billion to Louisiana – and provide critical aid to struggling families. The law also contains an important provision for states receiving the aid: for every dollar that a state government spends on net tax cuts, it will lose a dollar of federal support. As lawmakers gavel into session next month, they will have an opportunity to make long overdue investments in Louisiana’s people, families and communities instead of providing tax cuts to businesses and the wealthy. This provision provides an incentive to do just that.  Nicholas Johnson of the Center on Budget and Policy Priorities has the details

Cutting state taxes now would repeat a mistake many states made in the wake of the Great Recession: they cut taxes, which harmed families, undermined economic growth, and exacerbated economic inequality and racial injustice. Instead, states should address critical health and economic needs by making investments that can help build antiracist, equitable states. To help them do so, the American Rescue Plan Act includes $195 billion in fiscal aid for state governments (and more for schools and for local, tribal, and territorial governments).

Prisons and Covid-19
The Covid-19 vaccine is providing hope to Louisianans eager to return to a sense of normalcy. But, while the rest of the state lines up for the vaccine, people incarcerated in Louisiana prisons are left isolated not only from their families but also from their legal counsel. While restrictions on family visits recently eased slightly, Louisiana is in the minority of states that still prevents attorneys from regularly seeing clients in person, an important component of quality legal representation. Julie O’Donoghue of the Louisiana Illuminator has the story

“It’s been difficult to prepare clients for hearings,” said Kerry Meyers, deputy director of the Parole Project, which provides legal help and coaching to longtime inmates appearing before the state’s parole board for release. “You don’t get the same interaction over the phone as you do sitting across from someone.” (…) Louisiana also sticks out for prioritizing family visits over attorney visits. It is one of the only states to continue to restrict attorneys from seeing their incarcerated clients. In 30 other states, attorneys are allowed to visit inmates in person, even as “normal visitation” continues to be shut down, according to The Marshall Project

Narrowing the digital divide
The pandemic made internet access mandatory virtually overnight as families faced a new reality requiring high speed internet – and devices to access it – for everyday activities like school, work and even doctor visits. Many Louisianans were unprepared for this rapid shift, and Black and Brown families started further behind their white peers. Newly enacted federal legislation, the Emergency Broadband Benefit Program, is designed to help low-income families afford the extra costs of access with discounts of $50 per month – $75 per month on tribal lands – for broadband service and an allowance toward device purchases. Elisha Brown of Facing South presents a picture that plays out across the South far too often:  

“This is a program that will help those at risk of digital disconnection. It will help those sitting in cars in parking lots just to catch a Wi-Fi signal to go online for work,” Jessica Rosenworcel, the FCC’s acting chair, said in a statement. “It will help those lingering outside the library with a laptop just to get a wireless signal for remote learning. It will help those who worry about choosing between paying a broadband bill and paying rent or buying groceries.”

Louisiana lawmakers established the Louisiana’s Broadband for Everyone in Louisiana (BEL) Commission amid the pandemic. The state also received $342 million from the Federal Communications Commission late last year to help in the effort to improve access, a good down payment on much needed improvements. 

Our broken unemployment system 
Unemployment insurance has been a financial lifeline for millions of American during the Covid-19 induced recession. The American Rescue Plan maintains the federal boost of $300 per week to help families forced to get by on Louisiana’s lowest in the nation unemployment insurance benefit. Now, one year into the crisis, workers continue to look for jobs that haven’t returned, and the Louisiana Workforce Commission is still struggling to get people the benefits they are owed. Sam Karlin of The Advocate reports:

Those caught up in the dragnet include Emily Underhill, who lost her job working on cruise ships early in the pandemic and started receiving unemployment benefits almost a year ago. A few weeks ago, she got a letter saying she owed the LWC $20,000 because she wasn’t eligible for the benefits she received.  After struggling to get someone on the phone — wait times have soared at the LWC, according to its data — she finally figured out she had to send in pictures of her driver’s license and Social Security card as part of new requirements. She hopes to be back to work this summer, but until then the unemployment benefits are keeping her afloat. “It’s keeping the bills paid, food on the table until the economy opens up and I can get back to doing what I was doing,” she said.

Number of the Day
18 million – The number of additional people collecting unemployment benefits this week, nationwide, compared to the number of claims in the last pre-Covid week in March 2020. (Source: Economic Policy Institute)