There’s A Far Simpler Way To Help Struggling Americans Than The Convoluted CARES Act And PPP

The economy could accomplish a full recovery within a few years, but policies to address the COVID-19 crisis—both the public health challenges and recession—have been inadequate and shortsighted. Now Congress has let supplemental unemployment benefits lapse, and that will subtract $72 billion each month from household income—and even that was not enough.

Democrats and the Republicans need to compromise and provide supplemental unemployment benefits and monthly stimulus checks to all households for the duration of the crisis. This should not be confused with a universal basic income, because it would expire once the economy is functioning on all cylinders again.

Early on, President Donald Trump had lots of help from House Speaker Nancy Pelosi, New York Gov. Andrew Cuomo and New York City Mayor Bill de Blasio denying the dangers posed by the virus but as events unfolded, he continued to eschew expert advice.  We still lack a coherent national framework—championed by a president who appears in command—that governors can apply for closures and reopenings, testing, contact tracing and social distancing similar to policies in Europe. 

European governments were more patient about reopening than U.S. states, infections peaked on the continent in April and remain well below that level. Here new cases fell initially and then pushed up to a new high. We got a second acceleration that continental Europe avoidedat least so far.

With the virus surging in Arizona, Texas, Florida and other southern states, businesses are digging in for a long period of depressed economic activity and consumers remain cautious.

Shutting the economy temporarily effectively shut many small businesses for good. Although 7.5 million workers returned to work in May and June, the Bureau of Labor Statistics reports 1.6 million jobs have been permanently lost since February, 4.6 million adults have quit the labor force altogether and state and local governments have released 1.5 million workers.

1 2 3
View single page >> |

Peter Morici is an economist and professor at the Smith School of Business, University of Maryland, and widely published columnist. He is the five time winner of the MarketWatch best forecaster ...

more
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.
Leslie Miriam 1 month ago Member's comment

" Now Congress has let supplemental unemployment benefits lapse, and that will subtract $72 billion each month from household income—and even that was not enough."

America has spent trillions to help its citizens economically. And they are still suffering. What are other poorer countries doing to help it's citizens. How can they even come close to helping at this level?

Ayelet Wolf 1 month ago Member's comment

Yes, though Americans are suffering, they should be thankful for what help they are getting. I know many people who were making more now thanks to the PUA and unemployment assistance, than when they were employed.

I have relatives in Israel who said that all they have gotten so far is that every family got a one time payment from the government of 500 nis per family. That's about $125. And that was back in April during the Passover holiday. They have had nothing since. And there are likely some countries that are doing nothing to help at all. These are dark times for the entire world.

Moon Kil Woong 1 month ago Contributor's comment

The issue is this has become a political football of blame the other party. It seems like no one cares about its passage besides the public that can see that doing nothing will hurt the economy further and no one brings up the biggest failure of this was the money not going directly to the public but misallocated to big businesses skirting the small business support it was intended for.

Carl Schwartz 1 month ago Member's comment

I agree with you 100%. This is the kind of time that politics should be put aside.

Angry Old Lady 1 month ago Member's comment

Oh my God yes! Did you read about how #Trump tried to tag onto a the new stimulus bill nearly $billion to pay for a new FBI building to fill a location eyed by competitors of his Hotel which is across the street? Americans are going hungry while politicians argue about how to be st help. Yet they can do this. Crazy.

Moon Kil Woong 1 month ago Contributor's comment

Sadly it holds up stimulus which I guess is part of the reason they are filling it with more pork, not like the billions they mis-allocated to big businesses and friends in the last bill was bad enough.

Angry Old Lady 1 month ago Member's comment

Yes, and don't forget all those politicians who, in the early days, told their constituents all was fine, while they secretly made millions selling off their stocks and warning their donors to do the same. Heads should roll for this but nothing will happen.