WaPo: Looks like COVID-19 relief Phase $ -- er, Phase 4 -- really is coming

The Cash Helicopter has not been grounded after all. After weeks of balking at House Democrats’ demand for another massive tranche of aid, Senate Republicans have oddly warmed up to the concept of Free Stuff right before a national election, according to the Washington PostGo figure.

“The country needs one last boost,” Mitch McConnell told reporters yesterday. This time around, however, McConnell wants key elements added, including a liability waiver to protect businesses from lawsuits stemming from COVID-19 reopening exposure:

McConnell has consistently said the next bill will include liability protections for businesses, health-care providers, universities and schools. He offered a time period for these protections on Monday, saying he envisioned a “narrowly crafted liability protection” for activities related to the novel coronavirus that would kick in December 2019 and last through 2024.

“Unless you’re grossly negligent or intentionally engaged in harmful behavior, you shouldn’t have to be penalized by getting sued on top of everything else, so that’ll be in there, I guarantee it,” McConnell said.

Democrats have strongly opposed such liability protections, and it’s not clear where a compromise on the issue might lie.

Bear in mind that Congress has already authorized $3 trillion dollars in off-budget aid in the pandemic crisis. Undoubtedly, some of this was critical-need spending; the Paycheck Protection Program, for instance, appeared to succeed in its mission of protecting jobs in hard-hit job markets. That might be worth replenishing, especially as some states move to roll back reopenings and put those same jobs back in jeopardy.

That might be popular with a few members of Congress for reasons other than the program’s broad success:

A firm partially owned by House Speaker Nancy Pelosi’s husband was among the lawmaker-linked businesses that got Paycheck Protection Program loans, according to data released Monday.

Companies owned by or associated with Reps. Mike Kelly (R-Pa.), Kevin Hern (R-Okla.), Markwayne Mullin (R-Okla.) and Rick Allen (R-Ga.) also received the coronavirus loans. Businesses linked to Reps. Roger Williams (R-Texas), Vicky Hartzler (R-Mo.), Susie Lee (D-Nev.) and Debbie Mucarsel-Powell (D-Fla.) previously reported they got loans.

Some watchdog groups raised eyebrows over these disbursements:

Craig Holman, an advocate from the watchdog group Public Citizen, said policymakers involved in shaping the program should not be allowed to profit off taxpayer-backed loans.

“If they have some sort of influence over how the money gets awarded, or how much money gets awarded, they should not be the recipients of those funds,” Holman said. “If they are the recipients of their own cash that they’re handing out, it really raises questions of self-dealing.”

Steve Ellis, president of Taxpayers for Common Sense, said a line should be drawn with policymakers who are directly involved in charting the path of federal funds.

“You can write the policy to be blind to the nature of the entities, but certainly if you are involved in drafting it, or modifying it to benefit certain businesses, that’s where the alarm bells should be raised,” said Ellis.

Even apart from those questions, though, has the rest of the money been disbursed yet? How effective were each of the programs that actually have completed? And given the rebounds in hiring, consumer demand, durable-goods orders, and other economic metrics, is more “stimulus” really necessary?

And what precisely will this new bill “stimulate,” anyway? It doesn’t sound like even McConnell has a good idea about that. He suggested that another round of direct stimulus payments to voters — er, families, excuse me — is on the table again despite some debate at the White House over the idea. The unemployment-insurance bonus that has acts as at least a theoretical disincentive for returning to work might only get scaled downward in an extension, perhaps in part for a trade involving direct stimulus:

White House officials have signaled to outside allies that they may accept a compromise measure in which the payment is reduced from an extra $600 per week to something closer to an extra $200 or $300 per week, while also getting behind another round of $1,200 stimulus checks. Administration officials have said they are exploring a “back-to-work” bonus that would give workers additional compensation for returning to their jobs, an idea supported by some key congressional Republicans.

At some level, this is all academic anyway. None of this is real money in any sense. Congress is just directing the creation of cash out of thin air and then dropping it on our heads with no intention of paying for it later. Under those circumstances, why not propose an aid package of 17 gazillion dollars? Unfortunately, the answer to that question is — because Democrats would then demand 32 gazillion dollars.

On that note, read Charles Lane’s warning about global confidence in the dollar waning because of the failure of our institutions. He’s not wrong about the institutional issues, but the real reason for losing confidence in it is because it’s not tethered to reality any longer. If it was, there would be real consequences to these massive relief programs in the next few years. Did we see any such consequences after the 2009 stimulus — austerity, cutbacks, elimination of government agencies? No, and that‘s the problem.

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