Governors seek Federal aid for Medicaid & Infrastructure

Governor Jim Douglas (R-Vt.) said “The challenge that we’re facing right now is a real one, and it has a cascading affect when the economy begins to go sour. Economic activity declines, investment is lower, the number of jobs decreases, income tax receipts are down, so a state’s fiscal fixtures begin to deteriorate… States are taking the lead in tightening our belts and reducing state spending… But economists across the political spectrum have made it clear that counter-cyclical spending by the federal government can accelerate our recovery.”

This is why Gov. Douglas says the National Governors Association (NGA) is making two considerate requests of Congress for a state stimulus package. First, support for infrastructure investment. Funding would go to “ready-to-go” state projects, of which more than 70% would go to transportation, and the remainder to renewable energy projects, water and sewage treatment, and investment in broadband infrastructure. Second, the NGA is requesting an increase in support for state Medicaid Programs, which are increasingly demanded during this economic downturn.

Governor Ed Rendell (D-Pa.), Gov. Douglas, and North Carolina General Assembly Speaker Joe Hackney agreed that President-Elect Obama will be very responsive to the NGA’s requests—the question is where the funding will be allocated and in what fashion.