Things Could Be Worse. State's Rainy Day Fund Could Be Puny.

This is the rainy day that Massachusetts has, for years, been saving for.

But to call this pandemic-induced economic crash a rainy day doesn't do justice to the scale of the looming disaster.  It's like calling World War II a bit of unpleasantness.

Another name for the state's Rainy Day Fund may have to be devised.  How does Flood of Biblical Proportions Account sound?

Today, the fund holds $3.47 billion dollars.  We will need every penny to mitigate the effects on state services and operations of a downturn that could soon rival the Great Depression.

Up until a few weeks ago, the Massachusetts economy was humming like a new BMW.

The economy was going so well that Governor Charlie Baker was ready to add another $310 million to the Rainy Day Fund and State Treasurer Deb Goldberg was urging legislators to commit to large and predictable Rainy Day Fund deposits to boost the state's credit rating and thereby reduce the costs of state borrowing.

In January, when addressing members of the House Ways & Means Committee, Goldberg noted that the agencies that rate bonds sold by the state to raise money for various projects had reduced the Commonwealth's bond rating three years ago because the state had spent money from the Rainy Day Fund at a time when the economy was expanding.  She also said the rating agencies "continue to express concern about our debt and pension liabilities."

Imagine how low state bond ratings will fall across the country in the coming months and how long they'll stay low.

Tomorrow, the legislature's Joint Committee on Ways & Means will be holding a "virtual roundtable" with economic experts to elicit opinions on what the pandemic is going to do to the state budget.  In keeping with the social distancing requirements of the day, the experts will be phoning it in. I don't think that will make it any easier to take what they'll be telling us.

UPDATE: The Joint Committee on Ways & Means was forced on the morning of April 7 to postpone the virtual roundtable due to technical difficulties: it could not get the webcast to livestream from the room at the State House where committee members had gathered.  The event has been rescheduled and will now be held on the morning of Tuesday, April 14.