This is going to be a big piece of the economic fallout from the virus. States and cities are facing going broke, because with so much of the economy shut down, sales tax revenue and state income tax revenues are also cratering.
The amounts could be in the billions of dollars in some states and big cities.
The numbers are big but the concept is fairly straightforward. A sharp decline in budgeted revenues, combined with no corresponding decrease in governmental expenditures, results in a budget deficit.
I can imagine the Democrats would want to see a bailout from Washington, DC, to make up for the losses of tax revenue during this crisis.
Will it happen?
If Biden wins the election, and Democrats stay in control of the House and gain or capture the Senate, I expect legislation to cover these state and local deficits will happen.
Just add another trillion or so to the federal deficit. What’s a few trillion among friends. (sarcasm)
The economic fallout will be dire. Blue state people are moving as is to red areas. This will simply speed up the progress. Migration will destroy any hope of a R ever holding office again as President.