The Fiscal Alliance Foundation & the Beacon Hill Institute today announced the results of a recent study exploring the economic impact of COVID-19 on the Transportation & Climate Initiative (TCI).
Commissioned by the Fiscal Alliance Foundation and conducted by the Beacon Hill Institute, the study finds the costs associated with TCI will increase across the board over the next two years as the Massachusetts economy continues to reel from the COVID-19 pandemic and drivers continue to stay off the roads in record numbers.
The study notes that the second quarter of 2020 saw the largest decline in real gross domestic product in Massachusetts history and estimates that, even with the arrival of vaccines and potential federal stimulus funds, the Massachusetts economy will not fully recover to pre-pandemic levels until after 2022.
The new costs of TCI to the Massachusetts economy are estimated to be:
- A reduction of business investment by $305 million
- A reduction of disposable income by $1,649 million
- A decline of 9,993 jobs in 2022
- A cost of $630 to the average Massachusetts households
- A decline of over $1 Billion in the State real GDP
“The BHI study confirms what most people intuitively already understand—increasing costs to consumers in the midst of one of the worst pandemics and economic downturns in history is a bad idea. It hurts our workers, it hurts our businesses, and it hurts our state. Most of all, the brunt of the costs of this program is going to be carried by the people who are least able to afford it: blue collar workers, essential workers, and the poor,” noted Paul D. Craney, spokesman for the Fiscal Alliance Foundation.
“Governor Baker signaled earlier this month that he was willing to tap the breaks and reconsider TCI in light of the pandemic. This study confirms the Governor’s wisdom of that decision. At this point, any involvement for Massachusetts to join TCI will only further damage our state’s economy and slow our recovery,” closed Craney.
A copy of the full study is available here.
A copy of the executive summary is available here.