Los Angeles County could see a $1-billion decline in sales tax revenue this fiscal year, which ends June 30, because of the massive economic impact of the coronavirus outbreak. The decline is expected to surpass $2 billion between now and the end of fiscal 2021, according to county estimates released Wednesday.
That’s just one county. A big one, granted, but still just one. This is why it’s so critical for Congress to budget relief funds for cities and states. Consumers will have plenty of cash to pull us out of recession after the lockdowns are over, but their job is going to be a lot harder if they’re working against the headwind of local governments cutting back spending by billions of dollars.
To successfully reopen the economy, we need more spending from consumers, businesses, state governments, and the federal government, all working together. We’re doing OK so far on three out of four of those. Now it’s time to get serious about the fourth.