Virtually the entire body of
developed democracies, except the United States, have social safety nets that
were in place well before the pandemic struck. Their people are markedly better
off than so many middle- and lower-income Americans. Conservative politicians
call such safety nets “socialism,” a word that actually means government
ownership of the assets of production (often including residential structures);
it should not be conflated with “social programs” like public schools, Social
Security, Medicare, SNAP, unemployment insurance, universal healthcare, etc.
But it is convenient to pretend these
concepts are one and the same, because so many older voters grew up in an era where anti-socialist (and anti-communist)
slogans proliferated and justified our support of right wing dictators
(particularly in Latin America), fighting the Vietnam War (which we lost) and
similar efforts. Concepts like the “domino theory” (allowing one communist
nation would begin a unstoppable flow of other communist takeovers), the “red
scare” (McCarthyism from the 1950s) and a belief that it is an “either/or”
choice to have capitalism or government-provided social programs. Politicians
used this confusion, these made-up theories, to get elected.
Millennials and younger were not
raised with any bugaboo over “socialism.” The face a tight entry level/early
years job market, massive student debt, unaffordable housing and open
government hostility to universal healthcare. While there are radical right
components to these rising generations, a majority of them they have or will
have some meaningful post-secondary education and fewer of them will live in
rural communities. They tilt the other way; the majority of these younger
Americans are clearly not looking at the United States the way their elders
have.
History also provides proof that
without social programs – like public education and in desperate times, the New
Deal which provided millions of jobs, many building infrastructure which
continues to this day to generate hard economic returns – the United States
just might not be the success story it became. Where would we be, for example,
without free public education? Betsy DeVos, our Secretary of Education, openly
believes that public schools should be closed and replaced with a voucher
system (isn’t that also a conservative no-no?) to enable much more religious
education not permitted in public schools (under the separation of church and
state in the First Amendment). That helps us compete on a global stage?
Arguments calling for a free market
are predicated on the notion that the United States’ brand of capitalism
embraces that concept. But when there are tax loopholes – from the “carried
interest rule” to massive tax cuts that only benefit the rich – government
subsidies (farm subsidies, bailouts to big failing industrial or financial
institutions, etc.) and laws and regulations that create unique access to risk
capital and cheap debt only to large companies and rich investors, the United
States appears to be a nation driven by “corporate socialism.” It is anything
but a free market. We have no problem incurring massive deficits to relieve
rich companies of a tax burden, widely supported by the GOP, but struggle with
deficits that are absolutely necessary to support working Americans and small
businesses trying to get through this pandemic and its economic consequences.
No, the answer is not sending people
back to close-knit workplaces to “reignite” the economy. That actually spreads
the contagion which only inflicts more long-term damage to our national
financial well-being. The Republican Senate refuses to continue the support
checks to individuals and small business, a bulwark of our economy. 57% of the
private work force and over 39% of our GDP is generated by small businesses. But
hundreds of thousands, probably rising to millions (there are over 20 million
small businesses in the US) of small businesses, are closing or dying in
bankruptcy. If we do not re-prime the pump, if we do not continue support to
individual workers struggling through a crisis made so much worse by government
misfeasance, we are dooming ourselves to a really tough decade or more to
recover, assuming recovery at all.
Deficits are not to be taken lightly, but we
did not have the luxury of avoid deficits in WWII. We faced rationing, sold
“war bonds” (deficit builders) and simply appropriated what we needed to win
that war. Nobody
knows exactly how many Americans lost their lives in that war, “but it is
estimated that around the U.S. counted around 407,000 military deaths and
around 12,000 civilian deaths (due to crimes of war and military activity such
as bombings.) The total death count for all Americans amounted up to 420,000.”
HistoryOnTheNet.com. Numbers that look a whole lot like the impact of the novel
coronavirus that plagues us today. What’s worse, the pandemic’s toll is
generated here… not in distant battlefields scattered around the world.
In short, if we do not understand the necessity of incurring
big deficits in this time of extreme crisis, which we can afford and which we
have incurred before in parallel crises, we will suffer a much worse economic
chaos for a very long time. Those lost businesses will not be there to rehire.
And individual workers will be forced to downsize their expectations based on a
lower earning base in future years, one made worse by increasing levels of
artificial intelligence-driven, job-replacing automation. A solid stock market
does not reflect a better life for most of us!
Nothing screams of the balloon of pain that is about to burst
like the eviction issue. Aside from the escalation of medical bankruptcies as
healthcare option continue to contract, the world is about to turn even more
cruel as the moratorium, where is applies, on evictions expires. Virtually all
of the government-imposed bans on evictions during this pandemic simply accrue
and defer rent until some future date. Renters are amassing huge levels of debt
that most certainly cannot be repaid when the bans are lifted, even in
going-forward adjusted installments.
“The evolving
patchwork of pandemic-related policy that’s swept the United States housing
market has left tenants and renters across the country in similar states of
uncertainty as experts warn of a pending eviction crisis that will increase homelessness
everywhere. Pandemic-related restrictions change frequently and sometimes
differ greatly by jurisdictions, but the long-term effects of an eviction are
largely universal: An eviction record can make it much more difficult to secure
new housing.
“‘Eviction is an incredibly traumatizing event
that affects every area of a family’s life and livelihood and well-being,’ says
Emily A. Benfer, director of the Health Justice Advocacy Clinic at Columbia Law
School and chair of the American Bar Association’s COVID-19 Task Force
Committee on Eviction…
“The new federal order from the CDC, effective
Sept. 4 through Dec. 31, prohibits payment-related evictions of tenants who
declare—under penalty of perjury—an income of less than $99,000 for singles and
$198,00 for couples, financial harm from COVID-19, and a susceptibility to
homelessness or crowded shelters if evicted. They also must demonstrate they’ve
sought governmental help paying rent.
“The new restrictions were unveiled about a
week after the CARES Act’s post-expiration waiting period expired, and they
don’t apply to jurisdictions that have their own (at least equivalent)
requirements, such as California…
“The individual stories represent a much
larger problem, says Stacy Butler, director of the Innovation for Justice
Program at the University of Arizona James E. Rogers College of Law… ‘The truly
terrifying story here is the magnitude of the impending eviction crisis—10
times our historic rate of eviction. People do not understand the ripple effect
this eviction crisis is going to have. It is so much greater than individuals
losing homes,” Butler says. “It is going to upend the housing market and
devastate entire communities. Decision-makers need to be thinking about massive
rent relief strategies.’
“The new CDC [anti-eviction] order ‘is an
immediate stopgap measure,’ Butler adds… ‘It does keep people housed during the
pandemic, but tenants will continue to accrue late rent, fines and costs
associated with failure to pay rent. When the moratorium is lifted, tenants
will still be financially responsible for those accrued costs’ she says. ‘Eviction
moratoriums need to be coupled with rental assistance and mortgage forbearance
to stabilize the housing market. The CDC decision does not lessen pending evictions,
it merely delays them.’… The CDC order allows for evictions for reasons other
than lack of payment, which attorneys say can be easily abused.” Meghann
Cuniff writing for the September 10th Journal of the American Bar
Association.
The catastrophe that looms by failing to
address the “little guy” (tens of millions of “little guys”) and that stubborn
and profoundly false GOP narrative that government support disincentives people
from going back to work (even where there isn’t any or it’s still too dangerous
for many jobs), could just take this nation into an economic calamity that
dwarfs the damage inflicted by the Great Depression of the 1930s. That has to
be so much worse than incurring a much greater federal deficit.
For those who argue that the US would slip in
value if our deficit grows significantly, I point out that the rest of the
world is also laboring under the economic stress of this pandemic. We are still
relatively stronger. Additionally, if for some reason we are not able widely to
deploy a safe vaccine against this virus within the immediate future, the
economic damage would be even more devastating. We need to take care of all
Americans! Not just those at the top.
I’m
Peter Dekom, and exactly what does the federal government, whose failure timely
to act and contain this viral outbreak – a nation which accounts for 4% of the
earth’s population but a quarter of its COVID infections and a fifth of its
COVID deaths – owe to its people?
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