July 20, 2020

Dear National Lawmakers,

As you consider a new package of aid to support the nation during the ongoing COVID- 19 pandemic, now is an appropriate time for the federal government to consider economic research carefully in order to provide well-targeted, significant relief to state governments and to individuals experiencing economic hardship. Support for state budgets, and for safety net programs, most notably funding for the Supplemental Nutrition Assistance Program (SNAP) and for Unemployment Insurance, are wise ways to do this.

Unlike the federal government, most states cannot issue debt to support operating expenses. Economic theory and history show that significant state and local government spending cuts can exacerbate recessions and weaken recoveries. Facing dramatically reduced tax revenues, states and localities will be forced to cut budgets for essential programs that support health, education, public safety, and public transportation, and that reduce poverty and hardship — unless federal support is provided.

Cutting state budgets is pro-cyclical, that is to say, it removes spending from the economy at a time when private sector demand is already reduced, making a robust recovery more difficult. Providing funds to states is a wise investment to hasten recovery.

SNAP and Unemployment Insurance provide food and funds to individuals and families in need. This funding, too, can contribute to a more rapid recovery, since low-income individuals are likely to spend new resources immediately, fostering economic activity. And, of course, these programs directly help individuals in need. State Unemployment Insurance funds have been dramatically depleted, while SNAP benefits have never been high enough to fully address food insecurity, and are especially inadequate in the current context.

Evidence indicates that the effects of COVID-19 fall hardest on Black and Latinx communities, and other people of color, as well as people with pre-existing health conditions, and people in poverty. These measures would provide some important relief.

A robust recovery package should address these issues with significant funds.

Henry Aaron Jacob Bastian Bruce and Virginia MacLaury Senior Assistant Professor of Economics Fellow Rutgers University The Brookings Institution Swati Bhatt Daron Acemoglu Lecturer Institute Professor Princeton University Massachusetts Institute of Technology Alan Blinder Jacqueline Agesa Professor of Economics and Public Professor Affairs Marshall University Princeton University

Randy Albelda Barry A. Bluestone Professor of Economics Professor Emeritus of Public Policy and University of Massachusetts Boston Urban Affairs Northeastern University Elizabeth Oltmans Ananat Associate Professor of Economics Peter Bohmer Barnard College, Columbia University Faculty Emeritus in Economics and Political Economy Michael Ash The Evergreen State College Professor of Economics & Public Policy University of Massachusetts Amherst Leah Boustan Professor of Economics Nahid Aslanbeigui Princeton University Professor of Economics Monmouth University Elissa Braunstein Professor and Chair of the Department Ron Baiman of Economics Associate Professor of Economics Colorado State University Benedictine University Nancy Brooks Radhika Balakrishnan Visiting Associate Professor Professor Cornell University Rutgers University Clair Brown Nina Banks Professor Associate Professor of Economics University of California Berkeley Bucknell University Christopher Brown Christopher B. Barrett Professor of Economics Stephen B. & Janice G. Ashley Professor Arkansas State University of Applied Economics and Management Cornell University John Philip Burkett Professor of Economics University of Rhode Island Gary Burtless Janet Currie Senior Fellow, Economic Studies Professor of Economics and Public Brookings Institution Affairs Princeton University Oriol Carbonell-Nicolau Professor Sheldon Danziger Rutgers University Distinguished University Professor of Public Policy Emeritus Christopher Carpenter University of Michigan E. Bronson Ingram Professor of Economics Willard Delavan Vanderbilt University Associate Professor of Economics Lebanon Valley College Howard Chernick Professor of Economics Emeritus J. Bradford DeLong Hunter College and the Graduate Professor Center, City University of NY University of California Berkeley

Menzie D. Chinn Peter Diamond Professor of Public Affairs and Institute Professor Emeritus Economics Massachusetts Institute of Technology University of Wisconsin, Madison William Theodore Dickens Kimberly E. Christensen University Distinguished Professor Economics Professor Northeastern University Sarah Lawrence College Ranjit S. Dighe Nathaniel Cline Professor Associate Professor State University of New York at Oswego University of Redlands Peter Doeringer Dorothy Sue Cobble Professor of Economics Emeritus Distinguished Professor Boston University Rutgers University Laura Dresser Richard D. Coe Associate Director, COWS, Assistant Professor of Economics Clinical Professor, Social Work New College of Florida University of Wisconsin Madison

Sean P. Corcoran Matthew Kraft Associate Professor of Public Policy and Associate Professor of Education and Education Economics Vanderbilt University Brown University

Amitava Krishna Dutt Professor University of Notre Dame Steven Fazzari John Golden Bert A. and Jeanette L. Lynch Professor Associate Professor of Economics of Economics and Sociology Allegheny College Washington University in St. Louis Michael Goodman Deborah M. Figart Professor of Public Policy Distinguished Professor of Economics UMass Dartmouth Stockton University Neva Goodwin Robert Forrant Distinguished Fellow Distinguished University Professor of Economics in Context Initiative, Boston History University University of Massachusetts Lowell Gene Grossman Ellen Frank Jacob Viner Professor of Economics and Senior Lecturer International Affairs University of Massachusetts-Boston Princeton University

Gerald Friedman Darrick Hamilton Professor of Economics Executive Director of the Kirwan University of Massachusetts at Amherst Institute for the Study of Race and Ethnicity James Galbraith Ohio State University Lloyd M. Bentsen Jr. Chair in Government/Business Relations Douglas Harris LBJ School of Public Affairs, The Professor and Chair of Economics University of Texas at Austin Tulane University

John Gallup Oliver Hart Associate Professor of Economics Lewis P. and Linda L. Geyser University Portland State University Professor Harvard University Irwin Garfinkel Professor Carolyn Heinrich School of Social Work Columbia Patricia and Rodes Hart Professor of University Public Policy, Education and Economics Vanderbilt University Teresa Ghilarducci Professor Harry J. Holzer The New School LaFarge SJ Professor of Public Policy Georgetown University Lonnie Golden Professor Economics and Labor-Human Saul H. Hymans Resources Professor of Economics & Statistics, Penn State University (Abington) Emeritus, Dept of Economics University of Michigan, Ann Arbor

Kenneth Jameson Yolanda K. Kodrzycki Professor Emeritus VP and Director, New England Public University of Utah Policy Center (retired) Federal Reserve Bank of Boston Paul Andrew Jargowsky Professor and Director, Center for Timothy Koechlin Urban Research and Education Director, International Studies Program Rutgers University Vassar College

William G. Johnson Ebru Kongar Professor Emeritus, Founder Center for Professor of Economics Health Information & Policy Dickinson College Arizona State University Laurence Kotlikoff Harry Katz Professor of Economics Jack Sheinkman Professor Boston University Cornell University Kate Krause Lawrence Katz Emerita Professor Elisabeth Allison Professor of University of New Mexico Economics Harvard University Adriana Kugler Professor of Public Policy and Haider A. Khan Economics Distinguished University Professor Georgetown University University of Denver Edith Kuiper Mary C. King Associate Professor Professor of Economics Emerita State University of New York at New Portland State University Paltz

Marieka Klawitter Kevin Lang Professor of Public Policy and Professor of Economics Governance Boston University University of Washington Ronald Lee Michael Klein Professor of Demography and William L. Clayton Professor of Economics, Emeritus International Economic Affairs, Fletcher University of California, Berkeley School, Tufts University Paul Leigh James Knickman Health Economics Professor Emeritus Robert Derzon Chair of Health and UC Davis Public Affairs, Emeritus New York University Victor D. Lippit Professor of Economics Emeritus University of California, Riverside David B. Lipsky Katherine A. Moos Anne Evans Estabrook Professor of Assistant Professor of Economics Dispute Resolution Emeritus University of Massachusetts Amherst Cornell University Julie A. Nelson Mark Long Emeritus Professor of Economics Professor of Public Policy and University of Massachusetts Boston Governance University of Washington Robert Noland Distinguished Professor Catherine Lynde Rutgers University Associate Professor, Retired University of Massachusetts Boston Jennifer Olmsted Professor of Economics and Director of Arthur MacEwan the Social Entrepreneurship Semester Professor Emeritus of Economics Drew University University of Massachusetts Boston Paul Osterman Bernard Malamud Professor Emeritus Professor of Economics Massachusetts Institute of Technology University of Nevada, Las Vegas Amanda Page-Hoongrajok Julie Matthaei Assistant Professor Professor Emeritus of Economics Saint Peter's University Wellesley College Prasannan Parthasarathi Daniel McFadden Professor Presidential Professor Boston College USC Schaeffer Center for Health Economics and Policy Karl Petrick Associate Professor of Economics Brandon McKoy Western New England University President New Jersey Policy Perspective Karen Pfeifer Professor Emerita of Economics Alicia Sasser Modestino Smith College Associate Professor of Economics and Public Policy Lynda Pickbourn Northeastern University Associate Professor of Economics Hampshire College Alan Monheit Professor of Health Economics Anne Morrison Piehl Rutgers University School of Public James Cullen Professor of Economics Health Rutgers University

Frank Popper Timothy Smeeding Professor Lee Rainwater Professor of Public Rutgers (Emeritus) and Princeton Affairs and Economics Universities University of Wisconsin Madison

Andrew Reschovsky Robert M. Solow Professor Emeritus of Public Affairs and Institute Professor Emeritus Applied Economics Massachusetts Institute of Technology University of Wisconsin Madison Lynn Tang Richard Roberts Professor of Economics and Professor of Economics International Business Monmouth University The College of New Jersey

Yana Rodgers Robert Tannenwald Professor Vice President (Retired) Rutgers University Federal Reserve Bank of Boston

Barkley Rosser David Terkla Professor of Economics and Kirby L. Dean, College of Liberal Arts and Cramer, Jr. Professor of Business Professor of Economics Administration University of Massachusetts Boston James Madison University Robert Triest Katheryn Russ Professor and Chair, Department of Associate Professor of Economics Economics University of California, Davis Northeastern University

Julia Sass Rubin Meredeth Turshen Associate Professor Professor Emerita Rutgers University Rutgers University

Richard Schmalensee Paul N. Van de Water Professor Emeritus of Economics & Senior Fellow Management Center on Budget and Policy Priorities Massachusetts Institute of Technology Paula B. Voos Tobias Schulze-Cleven Professor, School of Management & Associate Professor of Labor Studies and Labor Relations Employment Relations Rutgers University Rutgers University-New Brunswick Geoffrey L. Wallace Robert J. Shiller Associate Professor of Economics and Sterling Professor of Economics Public Affairs Yale University University of Wisconsin - Madison

George Waters Professor Illinois State University

Mark Watson Howard Harrison and Gabrielle Snyder Beck Professor of Economics and Public Affairs Princeton University

Eugene White Distinguished Professor of Economics Rutgers University

Noé M. Wiener Lecturer in Economics University of Massachusetts Amherst

Barbara Wolfe Richard A Easterlin Professor of Economics and Public Affairs University of Wisconsin-Madison

Owen Zidar Professor of Economics and Public Affairs Princeton University