Greg R. Lawson reviewed the impact of Covid-19 on Ohio’s cities, politics, and economy with Charles F. McElwee, assistant editor of City Journal. Lawson is a research fellow at The Buckeye Institute and serves as its liaison to officials in the legislative and executive branches. Lawson has worked closely on seven state budgets and has a deep knowledge of state and local taxes, as well as Medicaid, education, and transportation funding. He is the author of the Piglet Book, The Buckeye Institute’s biennial publication outlining areas of government waste. He began his career in state policy as a legislative-service commission fellow with the Ohio General Assembly.
How has Governor Mike DeWine managed the Covid-19 crisis?
So far, Governor DeWine has handled the crisis relatively well, given the uncertainty and testing limitations. It would have been better if the state had released more data to provide greater clarity on patients suffering from Covid-19 as they moved from ICU beds to regular hospital beds and were then released from hospitals. There’s still time to make this data available, and it would offer a more complete picture of how the virus is affecting Ohioans. In addition, it would alleviate some of the long-term fears that Ohioans have about the virus.
Ohio is at a critical stage. DeWine wants to reopen the state, and it’s essential that all businesses—especially small businesses—get time to implement reasonable protocols to ensure the safety of their workers and customers. The longer Ohio small businesses remain closed, the less likely they are ever to reopen.
Compared with many Ohio cities and towns, Columbus has experienced dramatic growth over the past decade. Could the crisis affect this trend?
Yes, it could, but Columbus will likely fare better than many other cities already struggling with declining economies before Covid-19. Ohio’s cities face a number of challenges. According to the Brookings Institute, four of the top five cities that will feel the most immediate fiscal impact of Covid-19 are in Ohio.
Without reforms that The Buckeye Institute has long championed to the state’s tax system and its economic policies, Ohio will struggle to recover economically. Ohio has one of the nation’s most complex tax structures, one that discourages business growth and relocation to the state. It’s one of the few states in the nation, for example, that relies heavily on municipal income-tax revenues. This leads to less stable revenues during recessions.
If Ohio’s cities, including Columbus, unwisely raise taxes, we’ll see more people and businesses leave, worsening an already-bad economic situation. Ohio’s cities need to implement cost-saving measures and spending alternatives, while reducing the fiscal burdens often placed on taxpayers.
How has the state government responded to the needs of Ohio’s workers and small businesses?
Ohio has been quick to adopt many of Buckeye’s policy recommendations, including: increasing telehealth access and monitoring; extending universal recognition of out-of-state medical licenses to doctors, physician assistants, and nurses; permitting pharmacists to test for Covid-19; enlisting medical and nursing students to support doctors and nurses fighting Covid-19; beginning to eliminate unnecessary budget commitments; instituting a hiring freeze in state government; and allowing establishments with liquor permits to sell and deliver alcohol on carry-out menus. As our Roadmap to Reopen Ohio Safely outlines, Ohio needs to make many of these recommendations permanent.
This crisis has revealed how Ohio’s budget is unsustainable and endangers the state’s ability to weather economic downturns. This is compounded by the systemic problems with Ohio’s unemployment fund, which didn’t keep pace with need during the Great Recession and will certainly fall well short during the pandemic.
Could the crisis change Ohio’s political composition?
The crisis will probably reinforce, rather than change, Ohio’s political composition. Without significant economic reforms, Ohio will find it increasingly difficult to attract many younger workers. Pre-crisis, the state’s population was already trending older.
What can other states learn from Ohio’s experience?
On the plus side, state-mandated restrictions and heroic efforts by the public and hospitals worked to “flatten the curve” and prevent Covid-19 from overrunning Ohio’s health system. Ohio has shown that quick action can limit the spread of dangerous viruses.
On the negative side, if the Great Recession of a decade ago is any indicator, Ohio will take longer to recover due to its uniquely bad tax system, its unstable budget, and its poor economic policies. In this regard, Ohio is a cautionary tale and shows that pro-growth economic policies, prudent budgeting, and substantive local-government reforms can help states recover more quickly from economic downturns.
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