ARLENE VIOLET – Accusation: The Democrats are using the pandemic to reward political allies

ARLENE VIOLET – Accusation: The Democrats are using the pandemic to reward political allies

Congressional Republicans are objecting to the $1.9 trillion legislation being pushed by the president and the Democrats to deal with the coronavirus pandemic and the resulting economic fallout. They argue that less than 9 percent of the entire total spending actually puts shots in the arms. While there is accuracy to the accusation, the bill also addresses economic fallout, not just vaccination, so the attack is far too narrow. So the real analysis involves the difference between the “necessary” $1.9 trillion tab and the Republican projection.

Both sides have valid points. Take the Republican talking point that if the package was about opening schools why less than 5 percent of all spending is on schools only being spent in 2021. The Democrats counter that there is a hiatus between additional funding availability and spending because of local school allocation spending. That assertion also has an element of truth but it is hard to argue that with $71 billion already allocated in past legislation which is still unspent that the Republicans are wrong. Also, the designation of another $129 billion should wait for the unfolding of the economy to see if it is necessary. Score a point for the Republicans.

The Republicans argue that the Democrats have changed the allocation formula per state. The old metric in the past two pieces of legislation was based only on population. In the present legislation passed by the House population and unemployment are the formula thereby giving California (Pelosi) more than $5 billion more and New York (Schumer) $2 billion more than the old formula. While arguments can be made for the respective projects which will be funded in the speaker’s state and that of the senate majority leader, those projects, nonetheless, are pork. Score another point to the Republicans.

The Republicans along with some moderate Democrats thought that the stimulus payment eligibility for the new round of $1,400 is too high. President Joseph Biden agreed to scale back full payment for individuals who earned under $75,000 and couples earning under $150,000 with the benefit disappearing over $80,000 and $160,000 respectively (instead of $100,000 and $200,000). The Democrats now appear to be on board with this carving out of 9 million recipients. Further, the tax credit for children and students for qualifying people who are filing their income tax also provides disposable funds. The Republicans score another point.

Yet, the Republican effort to make the legislation better will ultimately come back to haunt them in the 2022 elections if they continue to grouse about it. Further, more like 85 percent of the stimulus package has a reasonable nexus with fighting the effects of the pandemic on health, education, welfare and the economy. Coupled with the reality that overwhelmingly voters support the stimulus package, a raft of attack ads during the midterm will portray the Republicans as willing to slash taxes for the wealthy while chiseling checks for people who are struggling during a national crisis. Tactics like insisting that the bill be read aloud (taking 11 hours) will backfire. With the modest victories the Republicans have achieved they need to hop off the cheapskates’ bandwagon right now or risk disaster. Right isn’t always might.

Violet is an attorney and former state attorney general.

Comments

It should be pointed out here, as it has also been reported in, and by, the most reputable sources: “America’s federal debt is set to exceed the size of the entire U.S. economy this year for only the second time since the end of World War II, a reflection of the extraordinary emergency measures approved by Congress in response to the coronavirus pandemic, according to the nonpartisan Congressional Budget Office!”

This remarkable surge in federal borrowing is due largely to the more than $4 trillion in spending approved by the federal government to fight the pandemic since March. As a result, the federal government’s debt burden will in 2021 be larger than the size of the total U.S. gross domestic product, a measure of all the goods and services in the economy, according to the CBO. 2020 was the first time this had occurred since 1946, when the country was fresh out of World War II.

Only Democratic lawmakers and some economists say another spending blitz is necessary to stabilize an economy that has stalled out and a job market that faces the prospect of permanent scarring., due to mis-classification errors and workers permanently leaving the labor force.

However fiscally responsible Republican lawmakers and deficit hawks warn that such unprecedented levels of peacetime spending threaten a risk to the economy. A sudden surge in inflation — not currently considered likely or imminent — could force the Federal Reserve to raise interest rates, which would in turn dramatically increase the costs of U.S. borrowing.

The CBO’s debt estimates are based on current policy and do not account for the irresponsible $1.9 trillion stimulus package!

As reported, first, in the Washington Post, Democrats have still gone forward with their irresponsible relief package despite the federal debt.

While some economists say more deficit spending could be the help the economy needs…it being said: “Deficit spending expands output and employment, which can generate more tax revenue,” It is also being promulgated that: “If as the result of a little more deficit spending, we get more growth and higher employment, that should not be too big a worry.”

At present the CBO projects the national debt is now on pace to grow to 107 percent of the GDP by 2031 — which would be an all-time high in American history.

Other budget experts point out that tackling the federal deficit requires more structural reforms to the nation’s economy, such as its low federal tax rates and projected increases in spending on Medicare and Social Security.

The United States is projected to hold about $21 trillion in debt in 2021, and that number is expected to increase to $32 trillion by 2030. A $1.9 trillion stimulus bill represents a fraction of that increase, although White House officials have also discussed trying to approve a multi-trillion-dollar infrastructure package later this year.

The CBO projections also assume the expiration of numerous provisions of the 2017 GOP tax law aimed at the lower and middle class by the middle of this decade.

Here's just a few of the pork loins included in this bill:

75 Million bucks for the National Endowment of the Arts

112 Million bucks for Nancy Pelosi's district for expansion of underground rail.

58 BILLION dollars for private pension plans

500 Million for museums and Native American language preservation

Upping the minimum wage to 15 dollars

50 Million for Planned Parenthood

11 Billion to airports

50 Million for "environmental Justice grants"

The list goes on and on and one, but if anyone believes that this bill targets the coronavirus issue, then I've got a 100 million dollar bridge to sell you that connects NY to Ontario. By the way, that 100 million is also included in this bill!

In the bill that just passed, a "child credit" which is actually a check to each family making $400,000.00 or less. Yes, that is right: $400,000.00. Depending on age, either $300 or $250 per child per month for a year. And, there is a rumor that the current administration secretly wishes to extend it forever. The $400,000.00 figure boggles my mind! Every tax paying citizen of the USA should be furious.

sad part that our children's children's children's will be paying this back. All this does is pay for power at our expense. Glad I am old .

Well someone voted for these knuckle heads and it wasn't me. Y does any of this surprise people?

I've read many accounts of supposed angst concerning the latest stimulus bill. In my humble opinion the average citizen doesn't care at all about spending, and won't care until they begin to receive bills in the mail for their portion of the debt.

Pole - See: https://www.cnbc.com/2021/03/16/this-calculator-shows-how-much-you-will-...

people making $400k do not get the child credit.