University of Illinois at Chicago

New reports address COVID-19’s fiscal effects, policy possibilities

Newswise — The economic, health and social impacts of COVID-19 are unprecedented, and state and local governments are not immune.

From revenue shortfalls to meeting increased demand for public services, the challenges facing government entities require atypical policies to deal with these issues in the COVID-19 era and beyond, according to new reports from the Government Finance Research Center at the University of Illinois Chicago.

The project, supported by the Joyce Foundation, features policy insights and ideas from scholars who strategically examine federal and state aid to cities, state banking, and infrastructure programs that could help. 

“Previous recessions provoked a federal government response in the form of business bailouts and support of state and local governments at a level much below the response to the COVID-19 crisis. The magnitude of the pandemic’s impact creates the need to explore options beyond the typical, incremental adjustments that public policies tend to promote,” said Amanda Kass, associate director of the center and co-author of the project’s fiscal aid research.

Their research and recommendations are presented in white papers and briefs corresponding to the following:

Fiscal Aid

  • Opportunities to enhance state aid programs: States may consider developing an automatic stabilizer component of their local aid programs, but sharp cuts to other state programs would have to be considered.
  • Federal government help: Creation of a federal automatic intergovernmental stabilizer program that would expand unrestricted aid to state and local governments during recessions and would gradually contract as the economy recovers.
  • Fill the gaps: While local governments are an engine of the American economy, there are numerous gaps and vulnerabilities in state and federal programs that aim to strengthen the finances of local government.

State Banking

  • Underserved communities: Providing credit in underserved areas is one of the primary functions for which a state bank might have a unique and constructive role to play in underserved communities.
  • Supporting credit to those in need: A state bank may be better embedded into neighborhoods, have superior knowledge about its customers and hence may suffer fewer loan defaults. The lower default rates at state banks combined with greater access to state deposits contribute to lower costs of making loans.
  • Challenges to state banks: A state-owned bank can generate surplus funds that can be employed to address various social issues outside the scope of private markets. A consortium of six independently created state banks for upper Midwest states is recommended to undertake lending activity.

Infrastructure

  • Economic stabilization function: There is historical evidence of the benefits of public infrastructure investments in difficult fiscal periods and an advantage for states that fund these major projects can be more responsive to local needs and their stimulus programs can be tailored to local economic situations.
  • Government investment: Consideration should be given to suspending balanced budget requirements if needed to provide necessary funds for states to stabilize economic conditions through investing in public infrastructure.
  • Financing projects: Despite some of its downsides, state governments can avoid undue pressure on their current revenues by financing projects using borrowed funds. One advantage of debt financing is that interest rates charged on borrowing for infrastructure are often lower than those on borrowing for other purposes because the interest received from municipal bonds is tax exempt to bondholders.

Contributing authors involved with the project are Robert Chirinko, UIC professor of finance; Philip Rocco, assistant professor of political science at Marquette University; Isabella Romano, research assistant at the Government Finance Research Center; and Yonghong Wu, UIC professor of public administration.

The full reports and other COVID-19 related projects by the Government Finance Research Center at UIC are available online.



Filters close

Showing results

110 of 5849
13-Jun-2021 12:05 PM EDT
COVID-19 Pandemic Drinking: Increases Among Women, Black Adults, and People with Children
Research Society on Alcoholism

Risky drinking has been a public health concern in the U.S. for decades, but the significant increase in retail alcohol sales following COVID-19 pandemic stay-at-home orders in particular raised red flags for alcohol researchers. New research has assessed changes in alcohol drinking patterns from before to after the enactment of stay-at-home orders. These results and others will be shared at the 44th annual scientific meeting of the Research Society on Alcoholism (RSA), which will be held virtually this year from the 19th - 23rd of June 2021 due to the COVID-19 pandemic.

13-Jun-2021 1:05 PM EDT
The Impact of the COVID-19 Pandemic on Alcohol Consumption Is Far From ‘One Size Fits All’
Research Society on Alcoholism

An ongoing analysis of the effects of the COVID-19 pandemic on alcohol and related outcomes shows that COVID-related stressors experienced by study participants – including work-, financial-, and family-related stressors – are having a varied impact on individuals with and without alcohol use disorders (AUDs). These results will be shared at the 44th annual scientific meeting of the Research Society on Alcoholism (RSA), which will be held virtually this year from the 19th - 23rd of June 2021 due to the COVID-19 pandemic.

Newswise:Video Embedded newswise-expert-panels-on-covid-19-pandemic-notable-excerpts-quotes-and-videos-available
VIDEO
Released: 18-Jun-2021 2:10 PM EDT
Newswise Expert Panels on COVID-19 Pandemic: Notable excerpts, quotes and videos available
Newswise

Newswise is hosting a series of Expert Panels discussion on unique aspects of the COVID-19 pandemic. This tip sheet includes some notable quotes from the panelists.

access_time Embargo lifts in 2 days
Embargo will expire: 23-Jun-2021 8:00 AM EDT Released to reporters: 18-Jun-2021 11:00 AM EDT

A reporter's PressPass is required to access this story until the embargo expires on 23-Jun-2021 8:00 AM EDT The Newswise PressPass gives verified journalists access to embargoed stories. Please log in to complete a presspass application. If you have not yet registered, please Register. When you fill out the registration form, please identify yourself as a reporter in order to advance to the presspass application form.

Newswise:Video Embedded virtual-event-for-june-17-11am-edt-covid-19-vaccines-and-male-fertility
VIDEO
Released: 18-Jun-2021 8:55 AM EDT
VIDEO AND TRANSCRIPT AVAILABLE: Vaccines and Male Fertility Event for June 17, 2021
Newswise

This upcoming JAMA-published study examined whether the COVID-19 vaccine impacts male fertility.

access_time Embargo lifts in 2 days
Embargo will expire: 22-Jun-2021 11:00 AM EDT Released to reporters: 18-Jun-2021 8:30 AM EDT

A reporter's PressPass is required to access this story until the embargo expires on 22-Jun-2021 11:00 AM EDT The Newswise PressPass gives verified journalists access to embargoed stories. Please log in to complete a presspass application. If you have not yet registered, please Register. When you fill out the registration form, please identify yourself as a reporter in order to advance to the presspass application form.

Released: 18-Jun-2021 7:05 AM EDT
Teamwork saves lives: COVID-19 hospital network shares key findings to improve care
Michigan Medicine - University of Michigan

Data sharing among 40 Michigan hospitals about the care and outcomes for thousands of inpatients with COVID-19 has led to reduced variation and findings that could inform care anywhere, including approaches for preventing blood clots and reducing overuse of antibiotics, as well as a risk prediction tool.

Released: 18-Jun-2021 7:05 AM EDT
One-third of older Americans delayed health care over COVID concerns
Michigan Medicine - University of Michigan

Nearly one in three Americans between the ages of 50 and 80 put off an in-person appointment for medical care in 2020 because they were worried about exposure to the novel coronavirus, new national poll data show.

Released: 17-Jun-2021 4:15 PM EDT
UNC Researchers Lead Study of Diabetes Treatment of COVID-19 Patients
University of North Carolina School of Medicine

Diabetes is one of the comorbidities most strongly associated with severe COVID-19 in the US, and data from early in the pandemic suggested individuals with type 2 diabetes faced twice the risk of death from COVID-19 and a greater risk of requiring hospitalization and intensive care. A new study shows best treatment options.

Released: 17-Jun-2021 4:10 PM EDT
Vaccination, Previous Infection, Protect Against COVID-19 gamma/P.1 Variant in Animal Model
University of Wisconsin-Madison

In a new study using variant virus recovered from one of the original travelers, researchers in the U.S. and Japan have found that vaccination with an mRNA vaccine induces antibody responses that would protect humans from infection with the gamma/P.1 variant.


Showing results

110 of 5849

close
1.18983