The Coronavirus is a serious challenge that government and the public must confront. It will require a major government effort to fight it. But, we cannot let it destroy our system of government and commerce.
On March 18th, President Trump signed into law the Families First Coronavirus Response Act. A one-page summary is here: Summary of Families First Coronavirus Response Act (PDF) On March 27th, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act. A one-page summary of the forgivable loans provisions applicable to businesses with 500 or less employees is here: Summary of Forgivable Loans Provisions of the CARES Act (PDF) A one-page summary of the unemployment provisions is here: Summary of Unemployment Provisions of the CARES Act (PDF) A one-page summary of the tax provisions is here: Summary of Major Tax Provisions of the CARES Act (PDF)
For years, the CDC had been warning of a pandemic. Few listened. Hereafter, virtually all will take the risk of pandemics seriously. A March 7-8, 2020 Wall Street Journal article titled “Global Outbreaks Are Likely to Continue” includes the following quote from Peter Daszak, president of EcoHealth Alliance, a New York-based nonprofit research group that built a database tracking disease events locally: “I’m not holding in my bunker right now. We’re going to get hit by a much bigger one sometime in the next 10 years.” (Bolding emphasis added)
We have “flattened the curve.” Many are now working from home. The attached letter to the editor supplies my ideas on how to get sports going. Letter to the Editor on Sports and Coronavirus Apr 26 2020 (PDF) The attached letter to the editor summarizes my beliefs on re-opening etc. as of May 1, 2020. Letter to the editor of the AJC May 6 2020 (PDF) The following attachment supplies my beliefs as of July 2020 on how the need for protection of employees and employers should be handled: Letter to editor of AJC Jul 21 2020
A significant targeted approach to the problem should be made that encourages returning to work when safe to do so. My beliefs as to how best to handle as of July 20, 2020 follow: Press release re next bailout July 2020 The CARES Act wasted too much money. Press Release, April 4, 2020 GA U.S. Senate Candidate Buckley Says Cares Act Is Poorly Crafted and Financially Irresponsible The following two April 23, 2020 articles from the Wall Street Journal are consistent with the press release. WSJ articles on CARES Act Apr 23 2020 (PDF) Most workers have received more pay laid off, making economic recovery more difficult. Coronavirus Relief Often Pays Workers More Than Work WSJ Apr 28 2020 (PDF) Banks were largely put in charge of the Paycheck Protection Program (PPP). They have preferred larger customers with larger loan requests, because their commission generally increases as the loan amount increases. If the PPP is continued, this problem needs to be rectified (perhaps by paying a fixed amount per loan). It is the job of a U.S. Senator to prevent such bad provisions from being included in legislation.
I am opposed to bailing out state and local governments. They can tax and amend their laws and constitutions. Where would it end? The attached article supplies an alternative to seeking money from the Federal Government: A Better Alternative to State Bankruptcy or Default WSJ May 8 2020 (PDF)
The attached document from the Committee for a Responsible Federal Budget shows financial impacts of federal actions through April 23, 2020. COVID-19 tracker from crfb (PDF)
We need to learn from the Coronavirus experience, to be able to handle the next pandemic. Unless future developments prove other conduct is necessary, let’s keep the facilities that are created as make-shift hospitals available for future use, while stockpiling things we know we’ll need, like masks. We should continue to closely track the Sweden experience and learn from it. Article on Lockdowns WSJ Apr 27 2020 (PDF) A May 7th article on Sweden’s experience is here: Sweden Stayed Open but Its Economy is Ailing WSJ May 8 2020 (PDF)
For years, very similar to the pandemic risk, federal agencies (including the GAO, SSA and CBO) and private financial organizations have been warning of a federal debt crisis. Very similar to the pandemic warning, few have listened. If our nation’s leaders had balanced the budget each year since 2012 (as they should have), spending $3-4 trillion on the pandemic would not have been a big deal. But, they didn’t, and thus much greater constraints exist. A tremendous amount of money will be printed, potentially causing conservative savers to lose dearly. As soon as the Coronavirus passes, our country needs to immediately get its financial house in order. Concerning the CARES Act that passed the U.S. Senate 96-0, I agree with the attached article. Article WSJ Save Capitalism from CARES Act Mar 31 2020 (PDF) I also think making low risk loans to larger businesses makes sense. A coronavirus commission, as discussed in the attached article, should be created to learn from the experience (so as to make the future better). Galston article Apr 1 2020 (PDF) As proposed in the Taxes Section, our federal government needs a rainy day fund. Businesses and individuals would be prudent to create their own rainy day funds.
A March 28th 2020 article in The Economist magazine titled “Building up the pillars of state” includes the following: “ . . . The rise in borrowing caused by America’s stimulus may be matched, at least initially, by bond purchases by the Fed, which smells a lot like printing money to finance deficits. . . . Politicians, too, are ripping up the rulebook. In a standard recession firms are allowed to go bust and people become unemployed. Even in normal economic times, roughly 8% of OECD companies go under each year, while 10% or so of the workforce lose a job. Now government hopes to stop this from happening entirely. . . . The vast majority of economists support these measures. Nominally they are temporary, designed to hold the economy in an induced coma until the pandemic passes, at which point the world is supposed to revert to the status quo ante. But history suggests that a return to pre-covid days is unlikely. Two lessons stand out. The first is that government control over the economy takes a large step up during a period of crisis—and in particular war. The second is that the forces encouraging governments to retain and expand economic control are stronger than the forces encouraging them to relinquish it, meaning a ‘temporary’ expansion of state power tends to become permanent. . . . What will be the lasting effects of the covid-19 pandemic? Start with the size of state. Over the next year government will rise sharply, as spending jumps and tax revenues collapse. When the economy recovers, attention will turn to paying it down. . . . But the redefined role of the state could prove to be the most significant shift. The rules of the game have been moving in one direction for centuries. Another radical change is looming.” See also attached WSJ article: Corornavirus Means the Era of Big Government Is . . . Back WSJ Apr 26 2020 (PDF) A major fight will be necessary to beat back this potential loss of individual rights. We need a senator who will bring the fight. I will.
The reality of the coronavirus and our ability to make it “go away” soon is covered in the attached article. Ladapo lockdowns article WSJ Apr 10 2020 (PDF) As the states and foreign governments opened up, the virus resurged.
As I have said since 2003, we need to balance the budget every year the U.S. is not experiencing a recession or worse. Running a large deficit in 2020 is prudent, and running a reasonable one in 2021 will likely be prudent. But, assuming things are largely back to normal in 2022, the budget needs to be balanced in 2022 and a small surplus be run (and the same thereafter). On this website is a page that explains how the national debt impacts ordinary Americans and the means of solving the financial problems. The debt needs to be placed under control to allow traditional monetary policy tools to potentially work, and to allow our nation to survive the next pandemic.