City & State
Months from now, when, hopefully, the dust starts to settle on the coronavirus outbreak, attention will likely shift from the immediate danger of the pandemic and the strain on health care resources, to the lasting consequences on the city and state’s economy.
Already, with New York moving to shut down restaurants – with the exception of take-out and delivery orders – bars, theaters and more businesses, some city and state officials are calling attention to the impact those public health actions will have on workers in retail, hospitality and more. “We are going to have to recreate economic capacity because people are going to be without,” New York City Mayor Bill de Blasio said Monday morning, during an interview on MSNBC. “If you don't have money, you can't pay the rent, you can't buy food, you can't buy medicine.”
David Friedfel, director of state studies at the Citizens Budget Commission, a good government group, said that other actions – like making changes to when people qualify for unemployment insurance and when people become eligible for Medicaid – may be more likely than freezing rent payments. “The availability of government resources to help people in need is an easier lift than forcing other private sector individuals or companies to accept late rent payments or that kind of a thing,” Friedfel said.
Of course, some of the recommended action – for example, a universal basic income – would be more likely to come from the federal government. Sen. Mitt Romney supported a version of universal basic income on Monday, proposing sending $1,000 checks to each American, as well as providing grants to impacted small businesses. New York City and state are also, like most other states and localities, more limited in how they can spend. Both because requirements to have balanced budgets and because of the fact that they can’t print money, the city and state are not able to run deficits like the federal government can.
Other options at the state’s disposal are dipping into its “rainy day reserve fund” – reserves set aside in case of a financial downtown, but which state Comptroller Tom DiNapoli has in the past said should have more money injected into it. Friedfel said even though the reserves aren’t as strong as they could be, now is the time to dip into the rainy day fund. “It’s raining,” Friedfel said.