Thursday, December 31, 2020

Money Talks

The Washington Post has now editorialized against the CASH Act because it would

send up to $3,000 for families of five earning as much as $150,000 — and at least a few dollars to those earning up to $210,000, before phasing out entirely. The bill does this while extending unemployment benefits a mere 11 weeks. In short, the measure short-shrifted the neediest and showered billions on people who suffered little or no lasting hardship from the pandemic. This, at a time when the economy has healed significantly and coronavirus vaccinations are underway — unlike the chaotic days of April, when Congress sent checks (of only $1,200) to help people cope with economic free fall.

Yet a just-passed House bill would compound all of those errors by increasing the $600 payment to $2,000, at a total cost of $464 billion. It would phase out completely only for families of five earning above $350,000. Much of this is going to be saved, not spent, since restaurants are closed and air travel limited. The resources would be far better spent, in terms of both economic equity and economic growth, on longer extension of unemployment benefits, aid to state and local governments, and vaccines.

The Editorial Board deserves credit for offering the best argument against the stimulus bill, when it could have said that it would drive up the national debt, a worse,even horrible, argument. Personally, I would prefer that if it could be, a portion of that $2,000 per person check would go to public transit systems because

as the economy cratered, so too have the tax revenues upon many which many transit systems rely. Philadelphia’s SEPTA is looking at upwards of $300 million in lost revenue through mid-2021. Maryland’s Transportation Trust Fund is contending with a $550 million shortfall in the fiscal year ending June 30, with similar losses expected next year. Los Angeles Metro is preparing for $1.8 billion in pandemic-related revenue losses. Chicago’s CTA is facing a half-billion dollar falloff in 2020. “I’ve been in this industry for over 30 years, and I have never experienced anything like what we’ve been dealing with in this pandemic,” says CTA President Dorval Carter, Jr. “There was no playbook for what we encountered.”

Alas, it will not happen, though there was someaid for ailing transit systems in the coronavirus bill President Trump finally signed on December 27.

Nor would there be an extension of unemployment benefits, aid to state and longer governments, and vaccines on the basis of Senate rejection of the $2,000 act. 

Keep it simple, stupid. The best reason for extending the payment to the relatively affluent, as well as to poor and working-class Americans, is the reason critics have cited to oppose (in some cases, disingenuously) the bill: it doesn't mean as much to the affluent.   It is a gift, not on the basis of grace but on the basis of common decency, to individuals who are struggling financially. And the vast majority of them will spend the vast majority of it doing their share, unintentionally, to stimulate the economy.

Also, this:

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