Trump tweets, states churn

Source: The American Prospect
by Gabrielle Gurley

“Last month, the Pew Charitable Trusts released its ‘Rainy Day Funds and State Credit Ratings’ report, which explored how state policymakers can avoid damaging credit rating downgrades. ‘In times of economic expansion, the agencies will reward states that deposit growing revenue as a cushion against future budget gaps when the economic cycle declines,’ Pew noted. Pew spotlighted Massachusetts, where Republican Governor Charlie Baker and state legislative leaders steered $200 million’s into the state’s stabilization or ‘rainy-day’ fund in fiscal 2016 in the hope of staving off a black mark from Wall Street’s powerful credit ratings agencies. … In the latest budget, administration officials also noted that since the first Wall Street warnings, the rainy-day fund had grown by about 20 percent, from $1.1 billion to $1.3 billion. The state spending plan also included a new proposal to build up the fund. But Massachusetts apparently did not do enough.” (06/16/17)