Without additional aid from the federal government, Kentucky Governor Andy Beshear says residents can expect a prolonged recession.
State and local budgets are already strained because of the coronavirus pandemic and without relief, Kentuckians could see higher unemployment, fewer services and staffing cuts to police, fire and education, Beshear said during a Thursday night update.
“If the next CARES Act package does not include budget assistance for states and counties, we will be hit with a rougher recession, it will last longer and it will be harder to dig out of.” Beshear said.
Data collected by Smartasset.com found that nearly 400,000 Kentuckians — or about 19% of the state’s workforce — signed up for unemployment insurance between March 15 and April 11.
As of Thursday evening, at least 3,481 people have tested positive for the coronavirus in Kentucky, and 191 people have died.
Beshear’s comments came in response to Senator Mitch McConnell, who told conservative radio host Hugh Hewitt on Wednesday that he would wait and assess whether to provide additional assistance to state and local governments.
“I said yesterday we’re going to push the pause button here,” McConnell said, “because I think this whole business of additional assistance for state and local governments needs to be thoroughly evaluated. There’s not going to be any desire on the Republican side to bail out state pensions by borrowing money from future generations.”
McConnell’s staff highlighted the comments in an email with the heading “Stopping Blue State Bailouts.” The senate majority leader also told Hewitt that states should consider filing for bankruptcy.
“I would certainly be in favor of allowing states to use the bankruptcy route,” McConnell said.
In response, Beshear said that while it might be possible for a state to declare bankruptcy, it could raise taxes on Kentucky residents.
“You hear political statements going back and forth. This is necessary. We don’t have it, we don’t crawl out and restart and rebuild,” Beshear said. “It will cripple our efforts to rebuild, if we don’t see an aid package.”
New York Gov. Andrew Cuomo also had some choice words for the senate majority leader, describing his bankruptcy suggestion as “one of the dumbest ideas of all time,” and calling out Kentucky for its reliance on federal funding.
“It’s your state that is living on the money that we generate,” Cuomo said. “Your state is getting bailed out, not my state.”
Beshear said he last spoke with McConnell’s office a week ago about the need for more funding, and will continue to press the senator for additional state and local assistance.