Coronavirus relief funds rain down like manna from heaven, sending Americans scrambling to fill their empty wallets with whichever goodies they can gather. During this era of sudden economic collapse and privation, it’s tempting to conclude that we’re all believers in entitlement now. Even though dollars are printed on pulp, it’s unwise to treat money as if it grows on trees. If the day of fiscal reckoning is to be forestalled, the ongoing crisis must not be used as an excuse for inexcusable excess.
The presses spitting out U.S. currency continue to hum as the House of Representatives on Thursday followed the Senate in approving $484 billion relief reload of its earlier $350 billion Paycheck Protection Program, part of a $2.2 trillion package meant to keep the nation’s businesses and workers afloat during the lengthy coronavirus-combating economic lockdown. The new appropriation is meant t0 provide an additional $321 billion for small businesses left out when the first installment ran dry. Among other allocations are $75 billion for hospitals overwhelmed with virus care expenses, $60 billion for business loans and $25 billion for virus testing.
In normal times, “welfare” has a repugnant ring, but when Americans find themselves flat on their backs through no mistake of their own, “paycheck protection” sounds like hope. A Pew Research Center survey published April 21 found that with the economy plummeting, a majority fully back the aid package passed in March. Republicans and Democrats rarely agree on the sum of one plus one these days, but an identical 89 percent applaud tapping the federal Treasury to replenish empty pockets from coast to coast. Opinion on the need to pull the economy out of its tailspin is indeed bipartisan. With 37 percent of Republicans rating the U.S. economy good or excellent and 11 percent of Democrats concurring, the only disagreement is over the degree of financial decrepitude.
As the nation’s cheerleader-in-chief, President Trump has repeatedly vowed the economy will regain steerage before hitting the ground and soar up higher than ever. “We’re going to have, just a tremendous surge,” he told Fox News on April 12. “I think it’s gonna be like a rocket ship. I really believe that.”
He may be proved correct, and we surely hope he is. The ship of state, rocket ship or otherwise, will be fighting for altitude with a heavier load, though. The Committee for a Responsible Federal Budget points out in a report released earlier this month that, as a result of coronavirus spending, the annual deficit will balloon from an already-bulbous $1.1 trillion this year to $3.8 trillion, and reach another porcine $2.1 trillion in 2021.
Jarringly, the report authors write, “We project debt held by the public will exceed the size of the economy by the end of Fiscal Year 2020 and eclipse the prior record set after World War II by 2023.” Alarmingly, these figures were added up before Congress wrote its latest multi-hundred-billion-dollar check.
Equally ominous is talk of another bulky spending package to bail out states and cities hurting from public pension fund losses resulting from the pandemic-driven recession, not to mention massive expenses incurred during the contagion-busting mobilization. The figure $500 billion is being tossed around, mostly by Democrats who have enjoyed spending tax dollars like Monopoly money since long before the coronavirus made its escape from Wuhan.
New York and New Jersey were each running deficits in the neighborhood of $6 billion when the outbreak began, and Illinois was stuck in a deeper, $7 billion hole. Watching Congress treat the Treasury like an ATM, “the Land of Lincoln” is shamelessly begging for nearly $42 billion. “The stimulus should not be used to bail out states,” tweeted former South Carolina Gov. Nikki Haley. “Some states have been run well and have a surplus. Others have not managed their states well. Taxpayers should not bail them out due to mismanagement. Funds should go to individuals, not state governments.” She is right.
There would be little pleasure in watching hard-hit states like New York, New Jersey and Illinois go bust, but neither would there be fairness in saddling each U.S. taxpayer with a new $8,700 debt, their share of a half-trillion-dollar bailout. Any additional appropriation must stipulate that funds should be used only for virus-related expenses. Americans can beat the coronavirus; less certain is whether those who lead them can conquer their addiction to debt.
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