There is of course a simple solution for the financial crises facing
states, cities, and towns (Broke Town, USA, New York Times Magazine,
March 6, 2011: 26-29). They desperately need Federal aid.
When New Orleans was devastated by Katrina, we had no difficulty with
pouring federal aid into Louisiana to restore and improve that city.
Today the States are facing the financial tsunami unleashed by Wall
Street. Most of them are facing budget deficits. Part of their
response is to cut aid to counties, towns and cities which put their
precarious finances in jeopardy - would that Watson could come up with
a costless solution!
What is needed is federal funding equivalent to about 25% of each
jurisdiction's 2007 budget. That money would remove the dangers of
drastic cuts to public services, to unemployment payments, to
medicare, and to the alleviation of poverty in a world in which 18% of
the working population is unemployed or underemployed.
Sadly, there is no political will to pour such necessary federal aid
into the states. A century from now, we will look back with regret on
that missed opportunity to stoke the recovery; just as today we regret
Roosevelt's attempts at budget balancing in 1937.