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It's not a stimulus package. It's a lifeline

Washington Examiner logo Washington Examiner 6 days ago Tiana Lowe
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Editor’s note: The opinions in this article are the author’s, as published by our content partner, and do not necessarily represent the views of MSN or Microsoft.

As the nation's businesses shutter and quarantining leaves millions without income, Congress has continued to kick the can down the road, with the House punting the $2 trillion coronavirus response bill agreed upon by the Senate and the White House for yet another day.

Despite everyone from the New York Times to sitting U.S. congressmen referring to the bill as "stimulus," this is not what the bill is. Its effects on consumer and corporate demand are secondary. It is, most importantly, a lifeline to employers and employees — direct cash relief to make sure that individuals have homes and sustenance in the short-run and jobs to return to when the worst of this pandemic passes.

Unlike the 2008 financial crisis or any other recent bubble burst, the cause of our immediate economic crisis isn't the result of an underlying demand problem. Before the pandemic, our unemployment rate was consistently hovering around a half-century low, pulling people out of the workforce back to business and leading to the first real wage growth, disproportionately benefiting low-earners, in a decade. As recently as January, Gallup found that U.S. residents had never been more optimistic about their personal financial prospects or their personal lives. Although the student loan and corporate debt bubbles still loomed large, the underlying realities of the economy were strong.

Now we are manufacturing an economic crisis — albeit for a good cause. To save millions of lives, the government has demanded that booming businesses shut down and send home their employees for a time. Customers are being turned away and told to stay home. The trade-off is worthwhile, certainly, but the slowdown is a conscious choice. The economy doesn't need a stimulus right now. But people forced to stay home need tiding over. They need relief.

Direct cash payments to consumers might increase demand somewhat, allowing more people to continue buying takeout and gift cards and to keep small businesses operational. But far more important is sustaining individuals as well as the jobs that they hope to return to until things get back to somewhat normal.

Calling such a bill "stimulus" is like calling hurricane relief aid "stimulus." It's a misnomer, and at most, a possible side effect of the bill's primary function.

Call it a lifeline, relief, or even a crisis bill. But it isn't a stimulus — it is a last resort to save individuals from starvation and small businesses from extinction, not to provide a profit boost to the powerful.


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