The coronavirus pandemic that hit the United States in early 2020 brought unprecedented challenges to the both the federal government and the states.  As governors and legislators new and old start consider their priorities, Citizens Against Government Waste (CAGW) suggests they should focus on 21 critical issues. 

State legislators, most of whom are part-time, cannot be experts on every issue, and, unlike members of Congress, they do not have large staffs and often rely on what they hear from relevant stakeholders.  They will be inundated with ideas from special-interest groups, who will prepare talking points and social media campaigns and once they are able again to do so, meet in person.

Each state has its own unique issues, but certain principles extend to all of them, especially in relation to the pandemic.  On behalf of CAGW’s one million members and supporters across the country, and indeed, all taxpayers, the following list of 21 issues for state legislators, governors, and local elected officials should their primary focus in the 2021 legislative session:

​​​1. States should not enact pharmaceutical price controls.

Price controls, sometimes modeled on the healthcare systems of countries with socialized medicine, lead to less innovation, fewer new drugs brought to the market, and worse outcomes for patients most in need.  U.S. pharmaceutical companies lead the world by far in research and development and were instrumental in creating a COVID-19 vaccine.  Instead of restricting prices, states should put pressure on the Food and Drug Administration (FDA) to clear its backlog of new medicines. 

2. States should expand telemedicine permanently.

During the coronavirus pandemic, many states have expanded telemedicine temporarily.  While this is a good step in the right direction, states should make these measures permanent so individuals who live in remote areas or otherwise cannot immediately get in to see a doctor in person have continued access to healthcare. As these services have expanded, McKinsey & Company’s Healthcare Systems & Services Division reported that telemedicine usage increased from 11 percent to 46 percent in the past year and could grow into a $250 billion industry.

3. States should promote private sector investments in broadband instead of creating taxpayer-funded, government-run broadband networks.  

States should promote private investment in broadband by reducing regulatory burdens on pole attachments and removing other barriers to deployment.  States should also stop funding government-run and municipal broadband projects that waste taxpayer resources with less-than-optimal results. 

4. States should let Congress take the lead on consumer privacy laws. 

State legislatures have enacted or considered consumer privacy protection laws to safeguard the personal information of their citizens.  But privacy, like commerce, is not confined within a state’s borders.  A national privacy framework is necessary to provide certainty to businesses to ensure that they remain in compliance with privacy rules regardless of the state where their customer resides.  States should encourage Congress to act quickly to create a national consumer privacy standard, instead of creating a patchwork of different state laws relating to consumer privacy that are both confusing and costly.

5. State use of COVID-19 relief funding must be carefully scrutinized to avoid waste, fraud, and abuse. 

When the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) passed in March 2020, it provided $139 billion to state and local governments. Unfortunately, several states and local governments started to use CARES Act funding for projects unrelated to the pandemic.  Michigan Governor Gretchen Whitmer (D) is offering free college to coronavirus pandemic workers with $24 million of CARES Act money, the Alabama legislature considered (but eventually rejected) using $200 million for a new state house and Capitol renovations, and Honolulu Mayor Kirk Caldwell (D) is using $629,000 to hire 15 community relations specialists and $200,000 to pressure wash and disinfect Chinatown sidewalks. Coronavirus relief should be targeted and temporary, and there must be strict accountability and transparency. 

6. State legislatures and taxpayers should push back on overreach from governors during the COVID-19 pandemic.

Many state lawmakers have been pushing back on overreach as governors attempt to lockdown their states.  They are particularly perturbed by what they view as excessive use of emergency powers without receiving legislative approval, including Gov. Whitmer  and California Governor Gavin Newsom (D).  The Michigan Supreme Court found Gov. Whitmer’s actions to be beyond her authority.  The United States Supreme Court also ordered judges in California to block the restrictions on houses of worship in the state after religious groups claimed that 99.1 percent of indoor worship services were prohibited.

7. States should avoid passing legislation or executive orders that impose heavy regulations on the internet in a misguided effort to bring back net neutrality. 

The Federal Communications Commission’s  December 2017 Restoring Internet Freedom Order restored the light touch regulation that enabled the internet to become a transformative engine of economic growth that revolutionized personal and commercial life.  Yet, several states have sought to undermine this decision and impose net neutrality laws on internet service providers that would regulate them as common telephone carriers despite the interstate nature of the internet.  Laws regulating interstate commerce are solely the purview of Congress, and states should stop wasting the taxpayers’ money on these fruitless efforts.

8. States should adopt long-term or permanent occupational licensing reform. 

Occupational licensing reform was being done before the coronavirus pandemic, but the changes necessitated by the economic impact of the virus brought the issue to the forefront.  Hairstylists, teachers, and cosmetologists are among those who have been heavily affected, but many state reforms are temporary.  States like Idaho and Florida passed major and permanent reforms both before and during the pandemic.  Other states should follow their example.  President Trump’s December 14, 2020 Executive Order on occupational licensing reform to increase “economic and geographic mobility” should be followed by state leaders.

9. States should reject any measure similar to California’s AB 5, which redefined independent contractors and led to the loss of millions of jobs for workers in the gig economy, freelance writers, and tutors, among many other businesses.  

While the people of California voted overwhelmingly to exempt app-based gig economy workers from AB 5 in the November 3 elections, the state needs to repeal the rest of the law.  Not only did the state pass AB 5, but other states including Illinois, Massachusetts, New Jersey, and New York have considered similar legislation.         

10. States should enact legislation similar to bills introduced in the House and Senate that will clarify the definition of independent contractors in a uniform manner across the country.

The “Helping Gig Economy Workers Act,” which has been introduced in the Senate and the House of Representatives, will enable businesses to provide independent contractors with employee assistance without being penalized by “misclassifying” them as full-time employees.

11. States should provide more regulatory flexibility to help service industries like restaurants and alcoholic beverage services.

While some businesses in the food and liquor industries will make it through survive the coronavirus pandemic, many restaurants, bars, and distilleries will not survive.  One way to help is for states to ease restrictions on the service of alcohol. For example, on October 13, 2020, Ohio Gov. Mike DeWine (R) signed into law HB 669, which would permanently allow carryout or delivery for alcoholic beverages.

12. States should fight against gas tax increases.

Many states propose gas tax increases on a regular basis.  While they are supposed to be used to maintain and improve infrastructure, as tens of millions of people have been working from home and not traveling during the pandemic, the use of vehicles and therefore roads has been substantially reduced. Those who want to raise the gas tax always claim there is a shortage of funds to fix the roads, but irresponsible spending has made that argument less valid. Alabama, California, Illinois, Nebraska, New Jersey, South Carolina, and Virginia have all raised their gas taxes in 2020 in the middle of the pandemic.  Several states are considering gas taxes in 2021, including Louisiana and Connecticut.

13. States should not raise income taxes; instead, they should be lowered or eliminated.

“Tax the rich” and making people  “pay their fair share” are phrases that come mostly from states that already have high taxes, including California, Massachusetts, New Jersey, and New York.  They are all seeking to raise taxes on those who they think make a lot of money.  On the seventh try, New Jersey passed the “millionaire’s tax.”  On the other hand, Mississippi Governor Tate Reeves (R) wants to phase out the individual income tax by 2030 to bring in business and new residents.

14. States should not raise state corporate taxes in response to federal tax cuts.

This terrible idea originated in California, where lawmakers proposed that half of  the value of the 2017 federal corporate tax cut should be turned over to the state.  Businesses are already fleeing California in droves to move to lower tax states. There would be an even greater outmigration if this proposal went into effect.

15. State legislatures should not support discriminatory taxes on specific products they think are bad for their constituents.

Bags, soda, plastic bottles, and other “unpopular” items are always a target for higher taxes.  They are not only regressive; they also do not have the intended impact.  A February 2020 Drexel University study found that one year after Philadelphia raised the soda tax, it had no influence on what Philadelphians were drinking. Taxes should be flat, low, and broad-based, instead of targeting specific products and industries.  

16. States should not increase taxes on tobacco-related products, which are regressive and fail to provide the intended impact on health.

Cigarettes, electronic delivery systems, and other tobacco products have become targetsfor tax increases in the U.S. and around the world.   The Centers for Disease Control and Prevention (CDC), the World Health Organization (WHO), and many state legislatures support raising taxes to discourage tobacco use. While seemingly well-intended, tobacco tax increases do not raise the intended revenue, the funds raised get diverted for unrelated purposes, and they lead to dangerous and illicit activity.  Since people can go to other states or online to purchase cigarettes where taxes are lower, estimates of expected revenue usually fall far short of expectations.  Programs that are supposed to be funded from the taxes then require other sources of revenue, which increases taxes on non-tobacco users. Yet, voters in Colorado and Oregon votedto raise tobacco taxes during the 2020 election.

17. States should reject mandating any increase in the minimum wage to $15 or more an hour.

When Seattle raised its minimum wage to $15 an hour beginning in 2015, a study found that low-wage workers lost an average of $125 a month because of layoffs and reduced hours.  The coronavirus pandemic was particularly harmful to these workers.  Companies like Amazon and Charter Communications determined that they should raise their minimum wage to $15 without the government getting involved. Unfortunately, some states are still pushing for an increase, including Florida, where voters agreed to raise the minimum wage to $15 an hour during the 2020 Election. 

18. States should encourage the federal government to not ban fracking.

President-elect Joe Biden called for a ban on fracking early on in his campaign, then retracted the complete ban to cover only fracking on federal lands Hydraulic fracturing, as it is formally called, is safe cost-effective, and the natural gas it generates is much cleaner than coal.  It has generated an American energy revolution that has made the U.S. self-sufficient.  A ban would lead the nation back to relying on imported oil from OPEC and Russia. 

19. States should not attempt to create their own versions of a “Green New Deal.”

Several states have attempted to enact legislation that would accomplish some of the objectives of the unaffordable and unattainable Green New Deal.  Efforts to mandate deadlines for renewable energy, among many other provisions of the Green New Deal, are impractical, expensive, and do disproportionate damage to the poor.

20. States should allow or expand sports betting.

After the Supreme Court found the Professional and Amateur Sports Protection Act (PASPA) of 1992 to be unconstitutional in its 7-2 ruling in Murphy v. NCAA in May 2018, states were free to determine whether to legalize sports betting.  States have shown that they can generate a lot of revenue and safely manage sports betting.  But states that overtax bettors and the gambling industry will not be successful.  Maryland, South Dakota, and 55 of 64 Louisiana parishes approved sports betting in during the 2020 elections.  More states should continue to legalize and expand sports betting.

21. States should adopt the Janus v. AFSCME ruling.

On June 28, 2018, the Supreme Court ruled in Janus v. AFSCME that public sector workers did not have to financially support unions with which they did not wish to associate.  Since then, several states, including Alaska and Texas, have adopted their own version of the Janus ruling.  Other states should follow their example.