25 March 2020
Cogito Ergo Non Serviam
The Democratic House and the Republican Senate finally agreed to help the people who elected them. The price tag for the economic aid bill is $2 trillion. The Senate will vote on the legislation around midday today. What happens after that is hard to say because the House is not in session. It could pass by unanimous consent, but there is always one person who wants to get the attention of the world by being difficult.
The Washington Post states, "The legislation, unprecedented in its size and scope, would send $1,200 checks to many Americans, create a $367 billion loan program for small businesses, and establish a $500 billion lending fund for industries, cities and states."
The main sticking point was the $500 billion lending fund. As originally written, the Secretary of the Treasury would be able to hand out money as he wished, with the terms of any loan kept secret for six months. Now, the Republicans and Democrats have agreed to a five-member supervisory board and an Inspector General who can keep things on the up and up.
The WaPo adds, "Other provisions include $150 billion for state and local stimulus funds and $130 billion for hospitals. It would significantly boost unemployment insurance benefits, expanding eligibility and offering workers an additional $600 a week for four month, on top of what state unemployment programs pay. Millions of Americans have filed for unemployment benefits in the past few weeks, flooding a system that isn’t designed to cope with a sudden wave of applicants."
The economic collapse is not an economic or financial problem. It is a symptom of a pandemic. Therefore, the government is doing the right thing in keeping people and businesses afloat. When the disease abates, people will return to business. They won't do it all at once, but there will be a resurrection of economic activity. The point of the aid is to keep as much of the economic machinery in order as possible. The better preserved the economic infrastructure is, the more rapidly things will bounce back.
The fact is that $2 trillion may not be enough if the disease takes more than a few months to burn down. The Spanish Flu of 1918 actually came in three waves, and the second was the most deadly. While one should be careful of arguing from historical analogy, the third wave did not really end until summer of 1919. The first was began in March 1918 or so. If Covid-19 lasts even half that time, the US Government will need to add a trillion or four more.
New York Senator Chuck Schumer said it best, "This is not a moment of celebration but one of necessity."
© Copyright 2020 by The Kensington Review, Jeff Myhre, PhD, Editor. No part of this publication may be reproduced without written consent. Produced using Ubuntu Linux.