The economy can't be closed forever                                                                 
6

March 25, 2020

Permission to republish original opeds and cartoons granted.

President Trump right to seek balance in moving forward in health emergency
The balancing act that President Donald Trump is attempting between public health concerns over the Chinese virus and the economic disaster being left in the wake of the government social distancing flattening the curve cure is perhaps the defining question of his presidency. The health emergency situation should be dramatically different in two to three weeks than it is today, giving the President a pathway to re-opening our nation for business without significantly increasing our collective risk of our medical systems being overrun during the economic re-start. The economic havoc already being wrought by the emergency response cannot be understated.  Local small businesses are having their very survival threatened as the fallout from the wise upfront actions of the President to meet the virus head on, and they are exactly why he is pushing hard to create a pathway to open up our nation for business.  Killing our nation’s economy for a decade with the social distress, increased suicides and drug addiction associated with it is not an acceptable outcome.  President Trump wisely has taken measures to slow the spread of the virus over the past two and a third months since it first was diagnosed on our shore, but he now has to move toward balancing the scales so the cure for the disease doesn’t kill the patient.

Art of the Deal as Trump secures $2 trillion economic rescue plan to sustain America
The Senate will complete its bipartisan work on a $2 trillion economic relief legislative package today to incentivize Americans to stay home during the Chinese coronavirus outbreak response period, expected to last at least until April 12, Easter Sunday, when President Donald Trump says he’d like to reopen the country if it’s safe to do so. Swift passage is expected. To keep everyone sustainably in their homes while we wait out the virus, Congress has produced the largest piece of legislation in American history by a long shot. Fiscal hawks may wish to avert their eyes. The bill will provide $367 billion for small businesses, $500 billion for critical industries, cities and states, $500 billion of additional checks to households that will come atop paychecks or unemployment benefits, $130 billion for hospitals to fight the outbreak, an additional $150 billion for state and local governments akin to the Obama stimulus of a decade ago, an additional $50 billion employee retention tax credit for companies, and the rest will go to a massive expansion of unemployment benefits that amount to paid sick leave for every person who had a job when the virus struck. In the meantime, the Federal Reserve is being given $4 trillion of new liquidity firepower to address any contagion that enters the financial system during this national emergency. This may be the first attempt to preempt a recession before it happened, preventing potentially hundreds of millions of job losses. If it works, it will be an economic miracle. It could prevent a depression.

Video: VP Pence urges every American household to follow guidelines on coronavirus and what's next?
Vice President Mike Pence is urging every American to follow guidelines to keep their families safe from the Chinese coronavirus at https://www.whitehouse.gov/wp-content/uploads/2020/03/03.16.20_coronavirus-guidance_8.5x11_315PM.pdf

Video: The strong dollar will worsen the coronavirus recession, Treasury should use stabilization fund
The Treasury should consider using its boosted Exchange Stabilization Fund from the economic relief legislation to weaken the dollar against foreign currencies to help shorten the economic downturn brought on by the Chinese coronavirus. Do you think monetary policy should play a role in the government's response effort?


 

President Trump right to seek balance in moving forward in health emergency

6

 

By Rick Manning

The balancing act that President Donald Trump is attempting between public health concerns over the Chinese virus and the economic disaster being left in the wake of the government social distancing flattening the curve cure is perhaps the defining question of his presidency.

In a conference call with Vice President Mike Pence yesterday, I was asked along with other attendees to remind people about the President’s Guidelines: 15 Days to slow the spread. But he also stated that the President is looking to end the economic shutdown in weeks not months. 

Let’s talk about that.

The social distancing hopefully will have had the effect of somewhat limiting the exponential growth of the disease. And while it may seem callous, since the first case was identified on Jan. 14, at this writing there have been fewer than 700 deaths and 55,000 cases.  To put this into perspective, an average of about 110 Americans die in car accidents each day. This is not to criticize the decision to shut down flights from China in January, or to shut down flights from Italy and elsewhere in Europe, and to push social distancing along with the cancellation of mass gatherings. 

Those were valid decisions based upon the possibility that this Chinese virus could kill as many as one and a half million Americans. 

However, since the health emergency has been declared, we have companies like 3M and Haines producing masks, medical gowns and automakers are turning their assembly lines loose on making needed ventilators.  The Defense Department and FEMA are actively setting up field hospitals to back stop the private medical systems capacity, and pharmaceutical manufacturers are moving rapidly toward finding treatments for this nasty little virus. Senior health facilities have been locked down and those who are most vulnerable have been a high priority focus for education and help.

All of these things have happened due to President Trump’s system wide approach to dealing with the Chinese created emergency.  The President has cut through the bureaucratic red tape to allow new tests that work to be created and widely disseminated (note: it is reported that the Chinese test kits provided to the Czech Republic are generating more false results than correct ones, making it clear that testing without accuracy has no value at all.)  Chloroquine is under a mass efficacy test focusing upon health providers, and other meds like Zithromycin are reported to be having positive results around the world.  Tens of millions of masks should be produced for U.S. distribution in the next few weeks, and the panic buying should subside so our store shelves will be restocked.

I lay this out because the health emergency situation should be dramatically different in two to three weeks than it is today, giving the President a pathway to re-opening our nation for business without significantly increasing our collective risk of our medical systems being overrun during the economic re-start.

The economic havoc already being wrought by the emergency response cannot be understated.  Personally, I have two nephews laid off and my step-brother is having to lay people off from his business.   

People like Kim McKenna Johnson who runs One Cross Medical in Campbellsville, Kentucky is helping patients over the phone to overcome their fears, but their waiting rooms are empty because of that same fear.  She estimates that her health provider service company will go under in two weeks as they run out of funds to pay staff.

Or, Hector Alvarado who runs an auto detailing company in California. Many of Mr. Alvarado’s orders have been cancelled, and like so many others, he cannot afford to be shut down because he is 100 percent self-employed with his family depending upon the income he provides.

These are just two of thousands, if not tens of thousands of local small businesses having their very survival threatened as the fallout from the wise upfront actions of the President to meet the virus head on, and they are exactly why he is pushing hard to create a pathway to open up our nation for business. 

Killing our nation’s economy for a decade with the social distress, increased suicides and drug addiction associated with it is not an acceptable outcome.  President Trump wisely has taken measures to slow the spread of the virus over the past two and a third months since it first was diagnosed on our shore, but he now has to move toward balancing the scales so the cure for the disease doesn’t kill the patient.

These are difficult decisions, but it is important that the voices of those whose businesses are at risk and the employees they have had to lay off be heard as part of this national discussion.

America’s free enterprise system is proving its greatness as companies are voluntarily moving their production lines to meet the emergency health supply needs without having to be compelled by the federal government.  Small businesses have accepted the sacrifices put upon them to meet the crisis, but they should not be forced to shutter their doors, as we move to the next stages in dealing with the health effects of the Chinese virus.  Congress needs to act on the CARE Act which provides a lifeline to these businesses, and in the weeks ahead, the President will have to make the very difficult decision on when and how to push the start button on the economy.

To make the decision easier, each of us should follow the guidelines put out by the White House last week for social distancing.

Listen and follow directions of state and local officials;

If you feel sick, stay home, do not go to work and contact your health provider;

If your children are sick, keep them at home, don’t send them to school and contact your health provider;

If someone in your house has tested positive, everyone in your household should stay home;

If you’re an older person, stay home and away from other people;

If you are a person with a serious underlying health condition that can put you at additional risk, stay home and away from other people.

Let’s do the things needed today so America can get back to work tomorrow.

Rick Manning is the President of Americans for Limited Government.


 

Art of the Deal as Trump secures $2 trillion economic rescue plan to sustain America while we wait out the virus

6

 

By Robert Romano

The Senate will complete its bipartisan work on a $2 trillion economic relief legislative package today to incentivize Americans to stay home during the Chinese coronavirus outbreak response period, expected to last at least until April 12, Easter Sunday, when President Donald Trump says he’d like to reopen the country if it’s safe to do so. Swift passage is expected in the House, too.

The legislation, the subject of intense negotiations for seemingly endless days as the U.S. economy hangs by a thread, businesses cannot meet payroll and layoffs are beginning a huge run-up, comes amid continued uncertainty about the virus’ trajectory. On day 15 of the President’s national effort to slow the spread, the White House promises an update on where we expect the virus to be in the coming weeks.

To keep everyone sustainably in their homes while we wait out the virus, Congress has produced the largest piece of legislation in American history by a long shot. Fiscal hawks may wish to avert their eyes.

The bill will provide $367 billion for small businesses, $500 billion for critical industries, cities and states, $500 billion of additional checks to households that will come atop paychecks or unemployment benefits, $130 billion for hospitals to fight the outbreak, an additional $150 billion for state and local governments akin to the Obama stimulus of a decade ago, an additional $50 billion employee retention tax credit for companies, and the rest will go to a massive expansion of unemployment benefits that amount to paid sick leave for every person who had a job when the virus struck.

In the meantime, the Federal Reserve is being given $4 trillion of new liquidity firepower to address any contagion that enters the financial system during this national emergency.

This may be the first attempt to preempt a recession before it happened, preventing potentially hundreds of millions of job losses. If it works, it will be an economic miracle. It could prevent a depression.

In early April, we’ll get the first unemployment report since the country went on lockdown. Without this legislation, double digit unemployment was not out of the question. I doubt it will be a good report either way, although there may be a lapse in the data from when folks were getting laid off and what they were able to report in the survey. What this bill will do is ensure is that the April report that comes out first week of May will be much less bad than it would have been.  

President Trump and Congress, if nothing else, can be proud that they are doing everything they can to save as many lives as possible from the virus. Keeping people sustainably in their homes is critical to that effort, and saving as many of the 30 million small businesses who cannot afford to close for a month or so as possible so that the economy has minimal disruption, are all important to protecting our health and our livelihoods in the longer term, too.

This has the potential to save tens of millions of jobs.

For Trump, buoyed by popular approval for his administration’s response to the virus, the economic safety net plan will in principle enable his administration and state governors to take as much time as they need to respond to the virus and save as many lives as possible.

Take your time, Mr. President. No rush.

Ultimately, it will be up to states to reopen what’s been closed locally. Things like air travel to certain destinations will be resolved federally. In tandem, parts of the economy will begin reopening when we proceed to the next phase.

Vast uncertainty has already been lifted by this deal, hopefully enabling more Americans to stay home and engage in social distancing.

Now, it will be up to the White House to make these benefits immediately available to the American people and businesses. Save them trips to the local unemployment office or bank. There should be a webpage or an app for many of these provisions. Applying should be easy or automatic in the case of tax provisions that Treasury can operate directly.

President Trump needs to tell every business directly that they need not lay anyone off. Really, businesses hold the fate of the recession in their hands. If every one of them take advantage of what’s in this legislation, not one person will need to have lost his or her job in the coronavirus outbreak. Continuity in business operations can be provided for.

What might have been a long, deep recession can be a shallow one or not one at all.

That appears to be the plan, anyway. Either way, nobody can say President Trump and Congress did not take this emergency seriously in what they were asking every American to do by staying home and not working. They found a way to sustain us all while the virus response takes place.

Now the job will be to ensure that these measures are actually temporary and end once the economic calamity caused by the virus passes. Stay tuned.

Robert Romano is the Vice President of Public Policy at Americans for Limited Government.


Video: VP Pence urges every American household to follow guidelines on coronavirus and what's next?

6

 

To view online: https://www.youtube.com/watch?v=8IHcYbpI7wA


Video: The strong dollar will worsen the coronavirus recession, Treasury should use stabilization fund

6

 

To view online: https://www.youtube.com/watch?v=Ud3fSs2zTQ4





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