I feel like this somehow needs to be said. State and local governments provide health care benefits to the neediest populations that are funded from the state’s tax revenues. This is a major component of state (and some local) budgets. Those budgets are funded from two primary sources: (1) sales taxes and (2) corporate and individual income taxes.
People who are out of work do not pay income taxes. People who are not out buying things do not pay sales taxes. Businesses that are not earning anything do not pay taxes on their non-existent earnings.
When you break the economy, you break everything.
The actions that states are taking right now are going to hurt their budgets in ways their leaders are not thinking clearly about. And state budgets tend to take a long time to recover.
The other major component of state budgets besides health care is education. There will be a delay, because there is always a delay between economic pukes and when it registers in tax collections. But a pronounced, months-long moratorium on revenue collection is going to hit per-pupil classroom spending and teachers’ and state employee pension funding like a freight train.
The stakes for a massive federal intervention at this moment are pretty high. All for a totally man-made crisis.
One thing that will be interesting in coming days is there will be a divide among state experiences for essential government services that reflects how leaders responded to this moment.