The coronavirus has devastated America’s economy. Small businesses have closed while certain large businesses have prospered–Amazon, WalMart, Loews, etc. Many restaurants are holding on by a thread. So how do you undo the damage? There seems to be some disagreement on the answer to that question.
Issues & Insights posted an article today about the stimulus package proposed by the Democrats. Simply put, the proposed package is nothing more than a bunch of goodies unrelated to the coronavirus. The package represents a wish list of spending the Democrats have wanted for years. The Republican attempts at reaching a compromise have been rebuffed.
The article reports:
In rejecting compromise, Biden gave Congress a green light to totally ignore Republican input by passing a stimulus package through reconciliation, not the normal budget process. That will require a simple majority of 51 senators, not a supermajority of 60, to pass.
Senate Democratic Leader Chuck Schumer confirmed this Tuesday, saying: “Joe Biden is totally on board with using reconciliation” to pass the bill.
So, just as with Obamacare, the fix is in on the Democrats’ all-or-nothing bill, loaded with goodies for far-left interest groups, teachers unions and Blue State governors.
But a few points need to be made here, not just about this bill, but about stimulus in general.
First, the economy is already recovering. It grew 33.4% in the third quarter and 4% in the fourth, following 2020’s disastrous 31.4% second quarter plunge. Unemployment peaked a 14.8% last April, but fell to 6.7% in December, far better than any official forecasts.
We’ve already committed $4 trillion in spending on COVID-19 over the past 10 months, but still have an estimated $1 trillion left unspent. Add another $1.9 trillion, and you see that COVID-19 adds to our already massive pile of federal debt, which, at $28 trillion, amounts to well over $200,000 per family.
Such reckless stimulus spending will impoverish the next generation. Yet, the fact is, the pandemic didn’t shut down the economy. Politicians did. Now they’re preening over their own generosity while piling up more debt that you, your kids, your grandkids and your great-grandkids will be paying off for decades to come.
Worse still, much of the Democrats’ “stimulus” bill will actually damage the economy.
The damage to the economy will be in the form of lost jobs due to the increase in the minimum wage. The Democrat plan will also extend unemployment benefits, which historically decreases the incentive for Americans to look for work.
The article also notes:
Helping fiscally troubled states is a huge mistake. Most are Blue States that have spent and taxed their way into trouble, and now want to use the pandemic as a cover for a bailout. It was bad policies by elected officials and bad decisions by voters that got these states into trouble, not the Chinese virus. Bailing out profligate states only encourages more of the same behavior.
And, sure, increased spending on schools sounds great, but that money won’t go to students. It will line greedy teachers unions’ pockets. Meanwhile, education standards and test scores will continue to slide as schools remain closed.
Instead of indiscriminately spending more money on bogus stimulus with checks for all, and irrelevant spending on Democrats’ far-left wish lists, we should target aid to the truly desperate and needy in our economy, those who were blindsided by some states’ destructive lockdowns and are now jobless.
So how do we grow our economy? First of all, we open up the country. Secondly, we do what President Trump did–cut taxes, decrease regulation, follow the rule of law, and protect property rights. Those things will get us back on track.