So, U.S. cities and states did not really need all that extra money after all this year. The hue and cry of mayors and governors, mostly from high-tax states by the way, for more urgently needed recovery funds bedeviled easily fooled politicians.
The Biden administration was certainly snookered when they launched the 100% partisan Democrat $1.9 trillion American Rescue Plan (ARP) even though the U.S. economy showed signs of a massive recovery.
The stimulus by the Federal Reserve, the distribution of the bipartisan $3.8 trillion CARES Act relief funds and the reopening of most states led to a furious boom, which recorded GDP growth of 6.3% in the first quarter.
Ignoring this reality, President Joe Biden, House Speaker Nancy Pelosi (from overtaxed California) and Senate Majority Leader Chuck Schumer (from overtaxed New York) still rammed $350 billion of borrowed money out to all the states, counties and major cities.
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Apparently, only 2.5% of said “urgently needed” money has been spent, according to an Associated Press review of the first finance reports filed with the U.S. Treasury Department.
The economic recovery and support for small businesses through successful programs like the Oklahoma Business Relief Program, crafted by former Secretary of Commerce Sean Kouplen and administered by Gov. Kevin Stitt, has led to high tax revenues that have bolstered Oklahoma’s budget. Most states have experienced the same.
More than half the states and nearly two-thirds of the approximately 90 largest cities reported no initial spending.
The truth that the ARP funds were a massive payoff to big government liberals for new big government spending rather than pandemic relief lies in the spending rules. Those only require funding commitments by the end of 2024 and actual expenditures by 2026.
In contrast, the CARES Act COVID-19 relief money was to be spent by Dec. 30, 2020, before a last-minute extension.
I predict we will witness, over the next four years, hundreds of wasteful spending projects that shock common sense and infuriate taxpayers.
The city of Pittsburgh has already launched a $500 per month check to low-income persons to test the merits of a guaranteed income program with no education or work requirements. Socialism definitely now has its nose in the tent and is looking to expand all across the country.
Here in Oklahoma, Stitt and legislative leaders covered last year’s budget cuts and increased spending only 3%. They wisely left $1.8 billion unspent.
The Joint Committee on American Rescue Plan Funds led by co-chairs Sen. Roger Thompson and Rep. Kevin Wallace have established four priorities: economic development and workforce, health and human services, government transformation and collaboration, and transportation, infrastructure and rural development.
The joint committee has $1.6 billion of ARP at its disposal. I hope and trust their leadership to advance one-time spending projects that will address Oklahoma’s two greatest needs for growth and prosperity: well-educated workers and more high-paying jobs.
Should we spend some of this borrowed money for our future? Well, yes, but all of it? I don’t think so.
Oklahoma is in a great position to invest wisely in transformative projects. Let’s hope we’re also frugal and lead the nation by example to reduce our national debt by sending some of the taxpayer money back.