Rainy Day Funds

It's time to use the rainy day fund to help save Vermont's economy, it's state government, and it's citizens.  Other states have started to use their rainy day funds to ease the harsh realities of the economic downturn.  Wall Street should replenish these funds for all 50 states.  Obviously, Congress and the White House aren't going to make sure that Wall Street is held accountable for being bailed out on the backs of the taxpayer.  

It's Raining Hard:  Let's Tap the Fund by Jack Hoffman - "But this crisis teaches the states a lesson:  They must be prepared for precipitous drops in revenue just when people are most in need of essential public services.  Like other states, Vermont needs a healthy rainy day fun - and it needs to use it."

"It's good for the state economy," according to Elizabeth Nichols of the Center on Budget and Policy Priorities.
Key Findings from Is It Raining Yet? Yes, and It's Time for Many States to Use Their Rainy Day Funds:

• With the economic slowdown creating budget gaps in many states, now is the appropriate time for them to tap the “rainy day” reserve funds they have set aside for just such a contingency.
• Most states have sufficient rainy day funds to reduce the amount of spending cuts or tax increases that would be needed to balance their budgets in the near term.
• Unlike spending cuts and tax increases, which worsen a downturn by further reducing overall demand, tapping a state’s reserve fund helps maintain overall demand by injecting savings into the economy.
• States concerned that the downturn could be deep and prolonged should respond not by hoarding their reserves but rather by devising a multi-year plan to address recession-induced budget problems.