In a newly released study of the ability of states to weather another recession, Moody’s found that Pennsylvania is one of 15 states that are significantly unprepared.
According to WHYY, Moody’s applied the financial stress test the Federal Reserve uses on banks to test if they could survive a moderate recession to the finances of the states.
The study found that a state would need to have a reserve of at least 7% to make it through a moderate recession without increases taxes or cutting spending. Pennsylvania’s lack of any real reserves means it would have to increase taxes or cut spending by a large amount to get through the recession.
“At a time when most states are looking forward to the next recession and trying to figure out how they can limit the impact of that recession on their economy and their budget, [in] Pennsylvania, we’re still worrying about how to recover from the past recession financially with our budget,” Moody’s Analytics Director Dan White told WHYY.
“For the average Pennsylvanian, what this means is that the next time we go through a recession, Pennsylvania is going to have to either significantly increase taxes or significantly cut state spending,” White added.
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9 Responses
Cut spending 30% across the Board including State Rep and State Senator saleries and insurance
Amen
Republicans need to friggin’ finally pass a reasonable budget.
Pennsylvania isn’t even prepared for an economic boon, with all the bullsh*t accounting tricks to kick the can down the road.
Because Tom Wolf does not understand finances. But I mean..he’s never had to.
I think you mean the senate republicans who don’t understand that you can cut revenue and still pay for services (and that government needs to provide services)
Governor Wolf ran a successful business that he sold for a profit. I am sure he understands finances. I am not so sure that the majority leadership understands finances or the people who are going to vote for this travesty.
I agree. I hate Tom Wolf, but he has to understand finances from a business perspective. It’s like when Dems say Trump doesn’t understand finances. They both understand finances for a business, but Trump’s ideas for our nation is better than what Wolf would ever propose. What I am trying to say, is that for business, they are both good/Great, but for state and national economies, Trump is better.
The Senate Republicans have actually been a voice of reason compared to the House Republicans, who don’t want to pay for the spending they passed. Corman and co. have explicitly said they need to find new sources of recurring revenues. It’s the zealots in the “Taxpayer” Caucus who don’t want to govern.