March 12, 2020

Stating the obvious

It's becoming clear that the COVID outbreak is threatening the economy as well as the health and lives of people all over, with people staying away from work and businesses (although not the local Kroger store!) and cancelling travel plans.

The Trump administration has come up with a "stable genius" plan to boost the economy: cut the payroll taxes that fund things like Social Security and Medicare.

This rivals the brilliance of building a border wall in Colorado or digging a moat and filling it with snakes and gators...

There are some obvious problems with the plan, as Chye-Ching Huang with the Center on Budget and Policy Priorities points out in this blog post. For starters, this wouldn't do a whole heckuva lot for the people who need it most, i.e. the people who miss work and don't get paid.

Another problem is that the economy needs a pretty big jolt sooner rather than later. Getting a few dollars more in a paycheck over a long period of time wouldn't make that much of a difference and it would weaken Social Security, etc.

Huang argues that "Sending stimulus checks to most Americans would put more money in households’ hands much more quickly than a payroll tax cut of the same cost. Also, stimulus checks can be sent both to workers and to people without earnings, including people receiving Social Security, Supplemental Security Income, or VA benefits and people unable to find jobs."

She also stresses the importance of strengthening and reforming unemployment insurance and food assistance programs, as well as enacting and extending paid sick leave.

And, while we're stating the obvious, let's not forget investing in public health and not messing with Medicaid.

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