By Benjamin Wilson and Jakob Feinig, Economics –
(1) Use Federal Reserve emergency money(approximately $20 billion at the state level),
(2) Reinstate the New York Stock Transfer Tax ($14-19 billion/year), and
(3) Create the Covid-19 Recovery Commission to ensure that Federal Reserve and tax money goes where it belongs: into the bank accounts of local workers, businesses, and essential services.
The universities, hospitals, public school districts, and municipalities for which we work provide essential and critical services. These institutions buy from the businesses in our communities, and much of our income as workers also supports local businesses. But the state faces a budget shortfall of nearly $20 billion, threatening local workers and their communities. It is now clear that we cannot expect help from Congress.
These three measures will end the state’s budget shortfall and enable us to enhance public services.
- Federal Reserve Emergency Money
The Federal Reserve currently provides emergency lending to states and municipalities. NYS and NYC are eligible for billions if the governor and the mayor of NYC choose to access them. This money is available immediately, doesn‘t have to be repaid before 2023 or 2024, and could cover the entire 2020 budget shortfalls for both the state and NYC.
Governor Cuomo and Mayor De Blasio need to act now because the emergency program (called the Municipal Liquidity Facility) ends on December 31, 2020. As union members, we should do everything we can to convince our elected officials that this cash infusion is necessary to protect us workers, our public services, and our local businesses. Banks regularly secure emergency funds provided by the Federal Reserve. As workers, we should do the same.
Using Federal Reserve cash is a first step in the right direction. Additionally, ending a tax rebate for financial institutions can yield additional revenue.
- Reinstate the NY Stock Transfer Tax
UUP, the NYS Nurses Association, and the Black Nurses Coalitions currently urge the NY legislature to reinstate the stock transfer tax, a move that would yield $14-19 billion per year. A single year’s tax revenue is nearly enough to pay back the state portion of the Federal Reserve emergency funds when they fall due.
Federal Reserve emergency funds and tax money will generate money beyond what we need to cover the budget shortfall. But we need to ensure that this money reaches the right people.
- Covid-19 Recovery Commission
NY Senate Bill S8456 creates the Covid-19 Recovery Commission, a democratic decision-making process to distribute public money. UUP and our partners should support this bill and demand a seat at the table of the Covid-19 Recovery Commission. To protect workers’ interests, we should urge the governor to nominate Union representatives to the commission.
An accountable and transparent Covid-19 recovery commission will ensure that the money flows to critical public institutions, to workers’ bank accounts, and from there, to the businesses and communities in which we live.
What we need to do now: Convince NY lawmakers that this three-part plan is doable. Get the money (1) from the Federal Reserve and (2) from taxes, and (3) distribute it to the people and institutions who need it and spend it locally.
The solution is right there in front of us. This plan is doable, and we will not accept unnecessary pain.
New York is a model for how to battle Covid-19; we can now become a model for how to mobilize public money.
