March 18, 2020

"The White House is asking Congress to allocate $500 billion for two separate waves of direct payments to American taxpayers in the coming weeks..."

"... and another $300 billion to help small businesses continue to meet payroll, according to a Treasury Department proposal circulating on Capitol Hill and among lobbyists. The outline, a copy of which was obtained by The New York Times, calls for a total of $1 trillion in spending for those programs, which would also include $50 billion for secured loans for the airline industry, and another $150 billion for secured loans or loan guarantees for other parts of the economy hard hit by the unfolding financial crisis."

The NYT reports.

57 comments:

Achilles said...

This will totally make up for the lost productivity.

Most people just don not understand how things actually work.

mccullough said...

This won’t be enough to mitigate the damage caused by The Overreaction.

Yancey Ward said...

I would have put most of it into payroll support for those sent home, but not laid off- the actual laid off can get UE, and we can visit and then revisit the UE extensions in the future; and zero-interest bridge loans. What you are trying to preserve is the structure of the economy in what is rapidly becoming a shutdown over large sections of it. What you want is for the structure to not be too badly damaged once the panic is over so that it doesn't take as long to start growing again.

Char Char Binks said...

FREE MONEY!!!

hstad said...

Restaurants are closing. Toilet paper is flying off the shelves. Arrests are being put on hold. Newsom in CA might declare 'Martial Law' - Is there an end to the madness the coronavirus has inflicted on our nation by the MSM and Politcos?

Bushman of the Kohlrabi said...

$500 Billion! That means each American could get $50 million!

Gusty Winds said...

Please tell me we're borrowing the money from China.

n.n said...

There is little alternative if shelter in place and social distancing are the generic advice, but they are not generally sustainable, and they are irreconcilable with critical services and social stability on a forward basis. So, prudence and boldness are the calls of the day. However, there is no reason to either import or export the contagion, and it reminds us that there is more than one cause to limit shared responsibility.

Phidippus said...

Ye gods. 0.25% Federal funds rate and the airlines need loan guarantees? With oil less at $30 a barrel?

If there's an economic rationale for this, could it make itself known? I can't find it.

Leland said...

Bernie Sanders may be losing in the polls, but he's desires are being enacted. The United States will be acquiring the debt of individuals. After all, that's what this money is for, right? To allow people to pay off their home loans or rent payments so they can stay in their homes while they don't have a job. This isn't even Socialism or Communism, as those economic models expect work for the money.

Buckwheathikes said...

There are 253 million adults (over 18) living in the United States. Let's do some math: $250 billion dollars divided by 253 million adults equals $988. Two payments of $988 = $1976

* Average mortgage in the United States is approximately $1,490.

* The average electrical bill in the United States is $117.00.

* The average car cost of ownership (loan, plus all the other fixed costs of ownership, not including insurance): $510.

So, that's $2,117 and we haven't purchased the first roll of toilet paper.

This bill is ridiculously unhelpful. It is a DROP IN THE BUCKET.

Congress must RIGHT NOW, not in two weeks, not in late May it must RIGHT NOW totally suspend all debts (with the resulting missed payments tacked onto the end of contracts) and this needs to continue throughout the crisis.

Anything less than that is simply not going to solve the economic crisis that our government has forced upon the citizenry.

I for one am unilaterally stopping all payment of all debts until this crisis is passed. I'm not paying my mortgage, my car note, my credit cards, etc. I don't give *FCK ONE about what this does to my credit rating because, frankly, there's not going to be an economy in 2 months from now anyway at this rate.

Congress needs to be getting FAR MORE CREATIVE, FAR FASTER than these dumb ideas I'm seeing floated in the NY Times.

Kai Akker said...

Helicopter money, one of Ben Bernanke's other great ideas. It wouldn't be needed if it weren't for his first great idea.

Ken B said...

Premature.

campy said...

"Hooray! We'll all be gazillionaires!" - NYT & MSNBC

brylun said...

It's the right thing to do.

Tom said...

We need to deduct the cost of this mess from the debt we owe China. Or at least put the debt service in escrow. China hid and lied about how bad this was and it spiraled out of control. The government has essentially turned off the economy and were coasting on printed money and saved resources until it’s over.

pacwest said...

To all American taxpayers? Non working SS recipients too? I still think increased immediate unemployment benifits are a better and fairer use of any funds distributed. I can understand the reasons for trying to keep business afloat to shorten the recovery time, but worry about how they can do that effectively.

Rick said...

The actions follow the Trump administration’s slow initial response to the global crisis that left the United States facing shortages of tests, hospital beds and equipment.

Interestingly there is no criticism of the NYT politicizing the virus.

Achilles said...

I think a sensible request would be that all government officials, people on various forms of welfare, government distributions, and pensions forgo these payments and have this money contributed to a pool that is distributed evenly to everyone.

You are forcing all people to stop working.

If you are going to make this a collectivist issue then the pain better start becoming collectivist too.

Payroll taxes are zeroing out. Where do you think that Social Security check comes from? Or that retirement pension?

Are you helping?

Jersey Fled said...

As reported in the NY Times:

Health care employees who worked while sick and who had jobs in multiple locations contributed to the spread of the coronavirus in nursing homes and assisted living centers in the Seattle area, which is experiencing the deadliest outbreak of the virus in the United States, the Centers for Disease Control and Prevention said in a report released on Wednesday.

These accounted for roughly 1/4 of the fatalities recorded in the U.S so far.

rhhardin said...

Payroll taxes are zeroing out. Where do you think that Social Security check comes from? Or that retirement pension?

SS comes from general revenues like everything else. The government must instantly return to the economy every penny it takes in, lest the money supply fall. No matter how you account for it, the SS fund winds up holding an IOU. Whether payroll taxes are larger or small than the SS payouts makes no difference to the operation.

Richard said...

This is not good. Not. Good. I admit to ridiculing BHO for the Stimulus Whatever Acts I was sure would lead to dire inflation. That didn't happen. ??? I hereby, in public, predict the same damn thing. The difference is an extra zero. I fear that we have been teetering on Hollywood Hover-Boards with amazing, and unexplainable dexterity.

cubanbob said...

I can understand lending the money to people who are furloughed due to government policy with a reasonable repayment period. The rest, no. One thing Congress ought to deal with is unemployment insurance reform. UE should be like flood insurance, a base through the government and if higher is needed, buy additional coverage from a private insurer. Right now, such a policy cannot be sold under the current law.

gilbar said...

IF they're GOING to spend this money; it should go to places that were ordered closed
the restaurants, bars, casinos and stripjoints

Especially the stripjoints;
most of their staff don't seem to be able to afford a decent pair of clothes as it is
Seriously, those catholic school girl outfits are Expensive! To say nothing of 7inch heels

Richard said...

This is not good. Not. Good. I admit to ridiculing BHO for the stimulus whatever Acts, that I was sure would lead to dire inflation. That didn't happen. ??? I hereby, in public, predict the same damn thing. The difference is an extra zero. I fear that we have been teetering on Hollywood Hover-Boards with amazing, and unexplainable dexterity.

Megthered said...

Husband and I are retired. We're doing ok and dont need a bailout. How can we refuse this money?

Mark said...

No reason for those getting social security to get an extra check. Needs exceptions.

Bay Area Guy said...

It's a total overreaction. But there are a lotta clueless folks pushing and fueling the epidemic, which pushes the ignorant politicians, which pushes the President.

The most hurt by this are blue collar workers in the private sector. Govt employees, college professors, they'll be fine.

Bob Boyd said...

How much do we owe China? About 5 trillion? We should take it out of that.

Skippy Tisdale said...

Every American? That's silly. I work for a multi-billion dollar electric utility. Electricity is a basic need, so we're all working, albeit doing so from home. Not that I couldn't make use of free money, but why should I get any free money? I'm actually saving money by working from home.

rhhardin said...

How can we refuse this money?

Cash it and burn the money. That's a gift to the US Treasury. You might want to retain the taxes on it, though. I have the feeling it's taxable income. You can return that part next year.

The Cracker Emcee Refulgent said...

"$500 Billion! That means each American could get $50 million!"

Stuff like this makes it all worthwhile.

Bob Boyd said...

How can we refuse this money?

Send me the money plus a 10% commission and I'll take care the entire refusal process for you.

Bob said...

Oobla dee, oobla da ...

Bob Boyd said...

I offer a satisfaction guarantee.
If you ever see that money again, you'll get your entire commission back.

n.n said...

Unsustainable. The cure may be worse than the disease.

n.n said...

It's a total overreaction. But there are a lotta clueless folks pushing and fueling the epidemic,

A social contagion motivated by demands to act on the so-called "precautionary principle" a la [catastrophic] [anthropogenic] climate cooling... warming... change.

Interestingly there is no criticism of the NYT politicizing the virus.

China revealed the germ nearly a trimester after it had originated or found sanctuary in Wuhan and was redistributed globally. NYT has been spreading the social contagion to influence democratic processes and protecting the antigens' source. Yeah, NYT should abort some of its editors and staff.

jeremyabrams said...

I want my share, but my wife and I are working and don't need it. They should define categories of affected workers, starting with restaurant workers, and shovel money to them.

somewhy said...

Interesting stat out of Australia this morning, where all I've previously seen is the number of "confirmed cases" being reported:

Up to yesterday there had been 81,000 tested, with 414 confirmed. I make that about 0.5% and I assume the people tested were in the "most likely" population - i.e. those with close recent contact with earlier confirmed infections.

One half of one percent in the "most at risk" population?

Yancey Ward said...

Bushman of the Kohlrobi wins the internet for the week.

Yancey Ward said...

Yes, all SS recipients should be excluded, and all people who are still working and/or getting paid to sit at home by their government employer should also be excluded. All people not in the workforce before the crisis should also be excluded (that is me, for example).

This really should be limited to people who have been furloughed without pay and don't qualify for UE, but you can use this to top what UE actually pays. Personally, I would have used to support the payroll for employees to keep their company's from laying them off in the first place.

sinz52 said...

"which would also include $50 billion for secured loans for the airline industry"

What the hell for?

Why not just let one or more airlines close its doors? The airplanes won't disintegrate. Someone will buy them and operate them under new management. (Remember the Trump air shuttle?)

If American Airlines ceases operations, maybe Jeff Bezos will buy up the facilities and we'll just have Amazon Airlines.

sinz52 said...

"Especially the stripjoints; "

Only if she learns a new dance:

Step by step, she removes her exam gloves and earloop mask to the music.

Michael The Magnificent said...

What a horrible idea. It was a bad idea when Mitt floated it, and hasn't gotten any better with others floating it.

Lucien said...

If you give everyone the same amount, all you need is their mailing address, and then you can have computers process the checks and mail them out in days. If you want to decide who really needs the money, you need to spend some of it to hire federal bureaucrats, who will take months. The, of course, everyone who doesn’t get the full amount will have to have appeal rights. . .

cf said...

President Trump mentioned that it would be a straightforward process, based on W-2s, which seemed a valid measure for the workforce. retired and others on benefits have a robust process already.
May all be well.
With one exception: For the eager beaver #PolPotLefties rubbing their hands together on @NPR news, gleefully celebrating the death of our economy, bleating for money money and more money, thrilled to tear the nation apart "Cloward-Piven Style". They can go to Hell.

RK said...

I've already spent the money.

Achilles said...

somewhy said...
Interesting stat out of Australia this morning, where all I've previously seen is the number of "confirmed cases" being reported:

Up to yesterday there had been 81,000 tested, with 414 confirmed. I make that about 0.5% and I assume the people tested were in the "most likely" population - i.e. those with close recent contact with earlier confirmed infections.

One half of one percent in the "most at risk" population?



And they had a lot more Chinese thoroughfare.

But it is Summer down under.

This is entirely in line with what some of us are saying and not particularly surprising to us that this just isn't having the impact on the southern hemisphere it is having on the north. It is not hitting Africa. It is not hitting India. Bangaladesh. Rowanda. Nigeria. Ivory Coast.

Temperature and humidity matter.

Look outside in Seattle. People talking about this extending into June and July are just not thinking for themselves.

If they do try to drag this out there should be consequences immediately.

MAJMike said...

I'd use my $1000 to buy an AR-15.

Modern solution for a modern problem.

narciso said...

Well there are some cases in qatar thr kingdom even iraq, but less then expected.

West Texas Intermediate Crude said...

I recommend that everybody who gets the $1000 (or whatever amount) who does not need it for basic necessities, use it to buy shares in SPY or whatever mutual fund you like. It will be profitable in the long run, and minimize the carnage in our retirement portfolios.

bagoh20 said...

It's definitely better than letting congress spend it, but they'll just take it back later anyway and from the young who probably most favor the idea.

Jason said...

If you don’t want to take the money, you can not cash the check, or you can donate it back to the Treasury when you do your taxes. Or give it to someone who needs it. If you can’t think of anyone, you need to get out and about more.

Geez... this isn’t difficult.

Buckwheathikes said...

https://www.nbcnews.com/politics/donald-trump/trump-hold-news-conference-fda-developments-coronavirus-n1162641

President Trump has announced he will "suspend evictions and foreclosures." But only until the end of April (1.5 months).

This will have little to no effect. Suspending foreclosures doesn't suspend your home mortgage payment and when this suspension is lifted, the mortgagers will demand missing payments from during the crisis (however long the crisis lasts); with the resulting hit to everyone's credit report.

This SIMPLY IS NOT ENOUGH. It is not enough to suspend foreclosures. This doesn't eliminate your mortgage payment. It just prevents the foreclosure from happening now and pushes it off to later.

It is NOT ENOUGH. Mortgages, car loans and other consumer credit loans MUST BE SUSPENDED - that is to say payments due NOW should be suspended and those payments added to the END of these loans. The lenders don't lose money that way (they merely delay when they make money). And homes and families are not destroyed. That is the only way to stop the economic carnage being inflicted on Americans by our government's actions.

AlbertAnonymous said...

I’m sorry. The gubmint wants you to know it’s gonna “give you” $1000 ?

Holy Shit! We’re all saved! Thank you gubmint!

GMAFB it’s our money already. How about you just let us keep more of it ?

The libs must be loving this. Where’s andrew Yang?

AlbertAnonymous said...

Gilbar said:

“Seriously, those catholic school girl outfits are Expensive! To say nothing of 7inch heels”

They’re deductible as uniform expenses ...

Of course it’s a cash business so they’re not likely showing all the income in their 1040. I’m sure the W2 from “Totally NOT A Strip Club Enterprises” shows at least minimum wage tho. Or maybe they get 1099’d?

Ken Rohleder said...

This strikes me as an aggressively progressive plan from a Republican administration. The last administration invested in shovel-ready pork barrel projects and sat on the sidelines while foreclosures "worked their way through the system." Not to mention a multi-billion dollar bailout of wallstreet.

Ironic.