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Outflanked XVII: A $2400 Fistful of Outflankening

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Thanks to the $1200 payment Democrats made much broader and the $2400/month unemployment Senate Dems led by Ron Wyden and Michael Bennet pushed through, disposable incomes actually took a historic leap upward during the worst economic depression in nearly a century:

Economists had expected to see personal income in the U.S. decline by 5.9 percent in April. Instead, it rose by a record-high 10.5 percent — thanks largely to policies that congressional Democrats forced Trump to enact over his party’s strenuous objections.

In a world where the U.S. government did not spread the wealth around through transfer payments, personal income would have fallen by 6.3 percent last month. But the combination of $1,200 coronavirus relief checks (which Republicans tried to deny to the most vulnerable before Democrats objected) and a $600 weekly boost to unemployment benefits (which Republican senators attempted to excise from the CARES Act) triggered a $3 trillion increase in total government social benefits last month, up from a comparatively piddling $70.2 billion increase in March.

As a result, America just saw its highest monthly increase in personal disposable income on record. And since opportunities for (safe) consumption were severely limited, Americans also increased their rate of savings to a record 33 percent.

Counterpoint: Nancy Pelosi’s refrigerator has ice cream in it, proving that congressional Democrats are committed to neoliberal austerity policies.

As Levitz goes on to explain, the next few months will be a question of whether the core Republican mission of immiserating the non-affluent will win out over Republican political self-interest.

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