Nassau County got some very good news last week after passage of the $1.9 trillion American Rescue Plan: The county will receive $397.7 million in federal aid to pay for expenses after it fell into a deep budget hole caused by the coronavirus pandemic.
Covid-19 has not only killed more than 530,000 people in the United States, but also has ravaged the finances of our state and local governments and school districts. States and counties — which depend heavily on sales taxes for funding — were particularly hard hit over the past year. People haven’t been shopping at local businesses the way they did before the pandemic, in part because many fear contracting the virus in public, and many simply haven’t the money to shop.
We hope and trust that the ARP will be a vital shot in the arm to reignite the economy, both here in New York and across the country. It is certainly giving local elected leaders the opportunity to breathe easier, knowing they won’t have to lay off essential workers, including police officers and emergency medical technicians.
In total, New York state will receive $12.6 billion in aid, which will be used to mitigate the spread of the virus and enhance the vaccination effort, as well as balance the state’s budget so it, too, can avoid layoffs. School districts will also benefit from the funding allocation.
No doubt, the ARP is far-reaching.
We should all be thankful that state and local governments will be made whole after a historically devastating year. Leaving them to fend for themselves — essentially the plan of Republican leaders like Senate Minority Leader Mitch McConnell — could have, and likely would have, been disastrous. Mass layoffs of front-line workers would have meant a double whammy for the nation: We would have lost not only many people entrusted with protecting our safety during the pandemic, but also their spending power and tax dollars.
The first round of federal pandemic aid provided by the Coronavirus Aid, Relief, and Economic Security Act, or CARES, was a $2.2 trillion economic stimulus bill, passed last March, that provided aid to states and, in a more limited way, local governments, as well as loans to businesses. It saved tens of thousands of businesses, especially small ones, and many, many lives, in particular through vaccine research.
The trouble was this: Any aid that state and local governments accepted could be used only to fund coronavirus mitigation efforts. There was no aid to those governments to continue operations while the economy was tanking last spring. State and local elected leaders pleaded — practically begged — for greater aid beyond funding for coronavirus mitigation, but the Republican-controlled Senate and President Trump would not budge.
The second round of aid, a hotly contested bill signed late last year, provided $900 billion, again without unrestricted aid to state and local governments.
With this third round of federal aid, we are seeing the load lifted for state and local elected leaders. At the same time, the American Rescue Plan will increase funding for vaccination programs, and provide $1,400 in direct aid to a majority of working families and individuals and greater funding for small businesses.
Yes, we continue to add to America’s debt — a debt that will one day have to be repaid. U.S. debt now stands at $27 trillion — or 128 percent of our gross domestic product. Only 10 years ago, we worried that our debt had surpassed 90 percent of GDP. So yes, we will have to cut back in the future.
Now, however, is not the time. In the here and now, we must focus on economic recovery, and the only way to lift ourselves out of our current fiscal quagmire and jump-start spending is through federal aid.
Going forward, we will have to work harder than ever — and we will have to do so together, united as one country, Republicans and Democrats. And we will have to innovate, which means we will have to focus more than ever on providing educational resources not only to our children, but to people of all ages.
As a nation, we will survive, but we will have to do a lot better than we did in 2020.