Congress is debating another $1 trillion stimulus package in response to the COVID-19 pandemic. The first stimulus package granted hundreds of billions of dollars in an attempt to relieve family, business and government funding shortfalls as a result of mandated school and business closures. If states accept more federal bailouts, it will only harm their economies in the long run. Instead, state leaders and lawmakers should focus on the sound policies proven to build state economies stronger and more resilient. 

There was overwhelming support for the first stimulus package in March, but voters are now aware of the strings attached that will accompany more state bailouts. A recent Rasmussen survey showed that 84 percent of likely voters are concerned the HEALS Act includes costly items that have nothing to do with the coronavirus. Americans should trust their instincts. 

The economic boom in recent years gave states the opportunity to build up rainy-day funds - but not all states planned for the rainy season brought on by COVID-19. Some remained highly dependent on their revenues and still accumulated massive debt. 

Now, another stimulus package threatens to reward those states that practiced poor fiscal restraint in pre-pandemic times, but at the expense of states that practiced sound fiscal management. 

Federal bailouts make big promises of quick fixes for Americans, but history has shown us these big promises continue a cycle of debt and spending, bankrupting the future. 

And lawmakers across the states are speaking up. Last week, over 200 state legislators signed a letter opposing a federal bailout of the states instead urging state leaders to practice fiscal discipline and put in place sound policy to ensure a strong recovery. 

Americans deserve stability following months of uncertainty, and the best thing state leaders can do is prioritize the tried and true policy that has consistently proven to build economic growth in states. For over a decade the ALEC-Laffer report “Rich States, Poor States” has ranked states for their potential economic growth by looking at 15 specific state policies. 

The proven policies highlighted in the annual report are always important for a state’s economic success, but in an economic downturn with clear budget shortfalls on the horizon, low-tax, low-regulation policies are even more important to the future of the states. Recently, the Center on Budget and Policy Priorities recently released a report that found for 2020-2022, state government revenues will fall by over $555 billion. 

The principles that value free market, fiscally responsible policy will help states respond to the high price of COVID-19 and prepare for future problems. And if states neglect their rainy-day funds, they will surely fail. 

History repeats itself, and what history teaches us about federal bailouts is that they are harmful to our states. This is a crucial time for decision-making that will define our future. It’s not a time to put hope in big promises, but to put confidence in the reliable policies we know give states a competitive edge. Failure to make proactive changes is enough for a state to get left behind. 

Proactivity is exactly the mindset we need moving forward. We need everyone - taxpayers, their elected officials and their state governments - to work together to make the right moves, put in place the right policies and rebuild society stronger than before. 

Nelson is the chief executive office of the American Legislative Exchange Council, an organization bringing state legislators and stakeholders together to develop public policy beneficial to the free market and individual liberty.