Edwards: U.S. Sen. McConnell ‘grossly irresponsible’ to suggest bankruptcy for states

By David Jacobs | The Center Square

U.S. Senate Majority Leader Mitch McConnell was “grossly irresponsible” to suggest he would rather see states declare bankruptcy than receive more federal aid, Louisiana Gov. John Bel Edwards said Thursday.

Edwards, a Democrat who leads a Republican-leaning state, usually avoids making headline-grabbing statements about national politics. Congress did not include aid to state governments in the $484 billion aid package that is expected to pass the U.S. House of Representatives Thursday, according to published reports.

States cannot declare bankruptcy under current law.

“I think this whole business of additional assistance for state and local governments needs to be thoroughly evaluated,” McConnell, a Kentucky Republican, said in an interview with a conservative radio host. “There’s not going to be any desire on the Republican side to bail out state pensions by borrowing money from future generations.”

The federal government already has provided money to state and local governments – Louisiana’s share is $1.8 billion – but those funds are meant to pay for efforts to address the COVID-19 pandemic, not to protect government budgets amid the deliberate economic slowdown meant to slow the spread of the disease.

Edwards said there is some flexibility in how the money can be spent but says Louisiana will “honor the spirit of the law.” He said state officials had not yet decided on how to allocate the 45 percent that is supposed to go to local governments. In theory, Congress could retroactively expand what the money could be used for, Edwards added.

In contrast to his statement about McConnell, Edwards praised the efforts of U.S. Sen. Bill Cassidy, a Louisiana Republican, to help secure $500 billion sought by the National Governors Association to make up for lost tax revenue.

As of noon Thursday, at least 1,540 Louisiana residents had been killed by COVID-19, the illness caused by the new coronavirus, according to the state Department of Health.

LDH said 1,727 patients were hospitalized, and 274 of those were on ventilators. Almost 26,000 cases had been reported statewide.

The number of new cases was up by almost 500, while the amount of people hospitalized and on ventilators both declined. The flattening of the infection curve in Louisiana, which once led the world in new case growth relative to its population, bodes well for efforts to open up more areas of the economy, Edwards said.

But he cautioned once again that the expansion of commerce will happen slowly and in phases. His current “stay at home” order expires after next Thursday, and he plans to provide guidance about what next month will look like early next week.

Edwards is asking residents to wear cloth masks in public to protect each other from the virus, though he is not calling for legal penalties against those who don’t. He suggested businesses might be required to have employees wear masks when they reopen.

The amount of testing and tracing of people who may have been exposed to the virus will dictate some of those decisions, Edwards says. More than 140,000 COVID-19 tests have been performed over the past six weeks, and the governor would like to see at least that many performed every month; 200,000 tests monthly is the goal.

He says the state has plenty of lab testing capacity, but tracking down the equipment and materials needed to perform that many tests has proved more difficult.