Senate Republicans are unveiling details of their proposal for another round of coronavirus stimulus. The GOP plan includes roughly $1 trillion in new spending. The intention is to shore up the flagging market. But bottom line the action is unnecessary. It is unhelpful.
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The proposal is igniting negotiations. That is because the Senate plan spends far less than the House plan. The introduction of the House plan was back in May. It has about $3.5 trillion in spending. Both proposals are ignorant in the extreme. This has set up what is likely to be a chaotic week of negotiations.
Should we overspend more or should we overspend unnecessarily?
Congress is also facing self-inflicted pressure from the expiration of the federal expansion of unemployment insurance. It will expire at the end of the month. This is the most contentious portion of the proposal. Even the people receiving the payment, at least the ones I have talked to, think it is over the top.
In August and September, the GOP plan will guarantee a payment of $200 per month. It goes to those on unemployment over and above their state payments. In October this will transition to guaranteeing wage replacement of 70 percent to those without a job, up to $500 a month.
The federal government needs to get out of the business of paying people to not work.
The right answer here is the “do nothing alternative”. That is a low-cost alternative. When you buy something you do not need in the first place the right answer is never to buy another and just pay less for the second. Here’s the clue. You did not need the first one. The second is never a bargain; even at half price. You did not need the first one… remember? This is a failure to recognize the right answer.
True, the GOP proposal is a cut to what is in place. Today the federal government pays an additional $600 per month. Democrats want to preserve that arrangement. Republicans worry that it is discouraging workers from returning to work. This in turn contributes to a slow economic recovery. The $200 proposal is also a stop-gap. Many states are working to adapt unemployment systems to make a fixed percentage payout. This is the latest episode of The Sky is Falling soap opera.
PPP all over every taxpaying son of a gun
The GOP proposal would also include another round of $1,200 stimulus checks. It is called vote-buying. It focuses on Americans making less than $75,000 a year and includes an additional $500 for dependents.
The proposal also pushes billions to local schools. Again, it is called vote-buying. There is no demonstrated need. Education is a local responsibility, not a federal responsibility. Get the federal government out of local schools. We need better educational outcomes… which more federal involvement, that means money, does not help.
Another provision creates a five-year legal liability shield for employers who fear legal action over virus safety. Conspicuously absent from the proposal is more money for state and local governments. Democrats want to bail out spend thrift states in trouble before the virus. But the GOP proposal increases flexibility allowed the states in spend the $150 billion already allocated under the CARES act.
A final bill will likely be somewhere between the GOP and Democrat proposals. Any compromise will seek the approval of White House negotiators. The coming negotiations pit party against party. The GOP package was originally expected last Thursday. It was delayed as final details were not agreed. There was a heated Senate GOP lunch last week.
Who will vote for the unnecessary for the ungrateful?
At the lunch Ted Cruz raised fears of the ballooning deficit. This was balanced by Tom Cotton arguing that bringing a halt to spending could spell electoral doom. This is the usual spineless GOP angst. Everyone knows more spending is harmful to the nation. Just do the right thing.
House Democrats are unhappy with Pelosi’s original package. Some describe their bill as little more than an effort to appease the Leftist mob. All of this adds up to a week’s press from Capitol Hill. Chicken Little has nothing, absolutely nothing on these boobs. This is nothing if not the latest episode of The Sky is Falling soap opera.