There are many contenders for the worst piece of legislation ever, but Francis Menton makes his case that, despite formidable competition, the COVID-19 Relief bill is a dire train wreck. At $1.9 trillion, that amounts to close to 10% of GDP in one shot, “without anything that could ever make it through a normal budgeting process.”
All the funding is to be borrowed and added to the accumulated national debt. The basic idea is to go out and borrow a vast amount of money and then spend it as wastefully as possible and as fast as possible. Could any rational person really think that this is a good idea?
The percentage of the spending that goes to actual public health measures related to the pandemic is tiny. An analysis by Reason here puts that percentage at 5%. In truth, the pandemic is just the cover story for a grand orgy of vote buying and giveaways to left-wing interest groups. “Vote buying” is the best description I can think of for the idea of passing out $1400 checks to essentially everybody. Free money!
The Democrats in Congress think that the recipients of the money are too dumb to realize that they are on the hook for repaying this later in life; and probably that’s right. With the $1400 handouts, the link to the pandemic is tenuous at best, since payment does not depend in any way on having suffered economic downside from the disease or from the government response, and only a small minority of recipients would meet such a test.
As the Manhattan Contrarian observes, the $1400 checks are the least destructive element in this monstrosity. Outclassing these checks are the teachers union payoff and blue state bailouts.
- The teachers Union Payoff: Some $129 billion for K-12 education, which is about a year and a half worth of the pre-existing Department of Education budget, and which is not tied in any way to actually reopening the schools or teaching the kids anything. The basic formula is, contribute a few tens of millions to keep the Democrats in power, and you will be rewarded with a few tens of billions of taxpayer money.
- The Blue State Bailout: At some $500 billion in handouts to state and local governments, this is dire.
The red states don’t need any bail-outs, and the blue states wouldn’t either, except that they have been overspending for decades, which was completely unrelated to this pandemic, and then when the virus hit they imposed extended “lockdowns” on the people and created vast amounts of forced and artificial unemployment. This being strictly an exercise in rewarding supporters and punishing adversaries, the state and local bail-outs will be allocated based on unemployment rate, meaning that the blue states with the high lockdown-based unemployment get the lion’s share. If you are a fiscally-responsible reddish state with a Democratic Senator or two (e.g., Arizona, Georgia, Montana, New Hampshire), your Senators have just sold you down the river.
The Child Tax Credit to Reduce Poverty by Half
Mr. Menton also focuses on the Child Tax Credit. The official talking point is that the CTC expansion will “reduce child poverty by half.” Completely false, reports the Manhattan Contrarian.
The CTC expansion is not going to reduce child poverty at all. Not even by one child. That is so because of the definitions used by the Census Bureau when it determines who is “in poverty.”
(Click here for details at the end of his post.)
Yet it seems that every single Democrat talking about this subject has adopted the completely false official talking point.
The whole idea here is to sell each program in turn to the public on the basis that it will supposedly reduce poverty, and then a few years later come back and announce that poverty remains the same, and demand yet another round of new programs, none of which will reduce the poverty (as measured) either.
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