States and Cities Seen Needing $500 Billion to Avert Fiscal Doom

State and local governments will need $500 billion in additional federal aid over the next two years to avoid major economic damage from the coronavirus pandemic, according to a Moody’s Analytics released Thursday.

The budget cutbacks by governments whose revenue is being sharply reduced by business closures could shave as much as three percentage points from the pace of economic growth and result in the loss of about 4 million jobs, wrote the economists led by Dan White, head of fiscal policy research.