Eric Levitz makes a number of good points about the dreadful response of Senate Republicans to the historical economic meltdown currently happening. The most important is how bad the bill is substantively. And given that there will be massive job loss caused by public policy, the denial of aid to the poor is even more nakedly punitive than usual:
Data from other states tells a similarly apocalyptic story. Extrapolating from the available data, economists at Goldman Sachs estimate that more than 2.25 million Americans will have lost their jobs by week’s end, the highest level ever recorded. After adjusting its growth projections to account for this carnage, the bank now predicts that the U.S. economy will contract by 6 percent this quarter — and by 24 percent next quarter — as unemployment more than doubles. Goldman does offer the consolation of 10- to 12-percent catch-up growth during the second half of this year. To enjoy such a “V-shaped recovery,” however, the U.S. will not only need to make (as yet, far from guaranteed) public health progress against COVID-19 but also keep its business sector solvent enough to rapidly emerge from hibernation once the pandemic is under control.
And if Senate Republicans get their way, a hefty percentage of America’s small businesses are about to die in their sleep.
On Friday, Mitch McConnell unveiled the economic rescue package he’d negotiated with the White House. The bill’s most incendiary provision is its revision of the Trump administration’s initial proposal for cash relief: Instead of sending $1,000 checks to all U.S. adults, as Treasury Secretary Steve Mnuchin had proposed, Senate Republicans would give less money to the poorest Americans, and none to those who earned over $99,000 in 2018. The insanity of this proposal was apparent even to some within McConnell’s caucus. Conventionally, conservatives justify providing less aid to the indigent than to the working poor on the grounds that the government should incentivize labor-force participation. But in the present context, millions of cash-strapped Americans are being denied the opportunity to work as a direct result of government policy. Under these conditions, there is no rationale for giving less aid to the poor than to the middle-class other than sheer contempt for the weak. Meanwhile, even if denying aid to those who made six figures were more valuable than expediting the dispersal of aid through a simpler approach (which it isn’t), there would remain an obvious problem: Just because someone made $100,000 in 2018 does not mean they are financially comfortable today; in fact, many such individuals have surely lost their jobs this week.
There are a variety of reasons why some pundits fantasized that Trump would respond to the pandemic as an FDR Democrat rather than a Paul Ryan Republican despite literally everything about his presidency making it clear it would be the latter. For those who aren’t just rationalizing their inevitable support for Donald the Economically Populist Dove, a key is a theme we’ve noted here before. A certain type of Savvy Pundit across the spectrum of the left thinks the height of sophistication is to assume that every right-wing figure acts out of pure corruption and venality. But as the Republican response to this crisis makes clear, even though many are individually venal American conservative politicians really do believe their own bullshit, and will act on it even when it’s contrary to their own political self-interest to do so:
From a crassly partisan perspective, meanwhile, the president’s party should be doing everything in its power to ensure a rapid rebound from the coronavirus crash. The fate of Trump’s campaign likely rests on whether strong growth returns in the third quarter of this year. Or at least, this is what GOP operatives are saying. And academic political science supports their view. It is true that, to this point, Trump has not suffered any decline in approval from the coronavirus crisis despite his literally indefensible handling of the pandemic (the president himself refuses to defend his own public statements about the virus’s fictional containment from earlier this year, preferring to simply fabricate an alternative recent history). But given the president’s personal unpopularity, it remains difficult to believe that his current ratings would survive a 20 percent contraction and 9 percent unemployment rate. Few incumbent parties in any democracy have ever won reelection while presiding over an election-year economic decline half as severe as the one we’re now entering. Trump and his party need a rapid turnaround by late summer. And the less they are willing to spend now to keep businesses solvent, workers employed, and households financially stable, the more improbable that turnaround is going to be.
Nevertheless, Republican lawmakers’ kneejerk ideological reflexes appear more powerful than the chorus of conservative wonks begging for more-aggressive measures. If McConnell and Co. allow their myopic phobia of massive countercyclical spending to delay and constrain the provision of aid, they will dig the Trump presidency’s grave. And when one considers the potential political ramifications of sudden mass unemployment and business failures — amid extraordinary inequality and a resurgent left — Republicans may well bury America’s low-road model of capitalism with their commander-in-chief.
This is going to be so bad, and so much worse than it needs to be.