Wall Street’s crisis is walloping state finances across the country. The most urgent problems are in states " like California " that rely on short-term financing to help pay their bills until tax revenues start coming in later on in the fiscal year. This is about the safest debt on the market. Still, over the past few weeks, states have been shut out of the credit markets like everybody else.
Washington must step up. To start, the federal government must help states like California and Massachusetts get past their short-term liquidity squeezes. Congress also must prepare a new stimulus bill, with bolstered aid for food stamps and assistance to states and cities so they can continue to provide health care and finance construction and other projects that provide jobs.
In 2003, Washington gave states $20 billion in grants and increased Medicaid contributions to help them dig out of the 2001 recession. We hope this time it will act a lot faster.
Remarkable job is right.