Cognoscenti Cognoscenti

Support the news

Republicans Are Lying About Our Pandemic-Inflated Debt

Senate Majority Leader Mitch McConnell (R-KY) listens to U.S. President Donald Trump talks to reporters while hosting Republican congressional leaders and members of Trump's cabinet in the Oval Office at the White House July 20, 2020 in Washington, DC. (Photo by Doug Mills-Pool/Getty Images)
Senate Majority Leader Mitch McConnell (R-KY) listens to U.S. President Donald Trump talks to reporters while hosting Republican congressional leaders and members of Trump's cabinet in the Oval Office at the White House July 20, 2020 in Washington, DC. (Photo by Doug Mills-Pool/Getty Images)

In Washington, where proverbially you should get a dog if you want a friend, truth-telling needs a dog in the U.S. Senate. Republicans there are honesty’s enemy, peddling this whopper: They’re mad as hell about all the government spending to help Americans left jobless by COVID-19, and they’re not going to take it anymore.

To help workers idled through no fault of their own, Uncle Sam added a $600 premium to weekly unemployment benefits. By proposing to cut that to $200, the Senate GOP’s HEALS Act merits rechristening as HEELS, a noun perfectly describing phony Republican deficit hawks squawking about deficits that, A. aren’t an existential threat, and B. the senators don’t really give a damn about.

That’s not their script, of course. Pleading what one reporter calls “deficit fatigue,” they find their spokesman in Sen. Ted Cruz, the Republican from the heart(lessness)land, who vows to vote against even his own party’s relief plan: “Massive spending and pork and ballooning deficits and debt are bipartisan problems.”

Not only that, the $600 premium, he and acolytes claim, rewards the idled with unemployment benefits often exceeding their former wages, discouraging them from taking jobs and reopening the economy.

... in fetishizing deficit reduction, the GOP demonstrates infidelity to both arithmetic and truth.

Costing $1 trillion, HEALS is just a third of the COVID-19 plan the House passed in May. With the premiums expiring after July 31 and the Republicans’ intramural logjam gumming up Senate action on pandemic assistance, millions of Americans’ financial welfare is careening towards a cliff. Yet in fetishizing deficit reduction, the GOP demonstrates infidelity to both arithmetic and truth.

First, there are currently 30 million Americans unemployed and 5 million job openings. You could cut unemployment benefits to zero — hell, you could tax the unemployed for being unemployed — and there still wouldn’t be enough jobs to absorb all those needing work. This is a depression, folks.

Oh, and 7 million unemployed workers went back to work in May and June — before new viral outbreaks closed parts of the economy again — voluntarily leaving that supposed hammock of overly generous benefits.

Still, isn’t today’s national debt, which results from the government’s borrowing to cover all of its past and current deficits, harrowing? It may hit 100% of the gross domestic product when this fiscal year ends on Sept. 30, and yes, that’s historically breathtaking. But it’s not a record; that was set after World War II, winning of which left the debt at 106 percent of GDP. Obviously, that didn’t trigger a national going-out-of-business sale; the Eisenhower years were immortalized as “Happy Days.”

Like the Second World War, COVID-19 and the accompanying economic slump is a national emergency that demands spending. Today’s low-interest rates make it easier for the government to pay down the debt. And cards on the table: We could do major deficit reduction in ways that wouldn’t crimp essential government obligations to the national welfare and defense.

So our GOP debt detectives, hot on the trail of spending cuts, will embrace those strategies, right? No. The Inspectors Clouseau are Inspectors Go-Slow on deficit-cutting, for the simple reason that their concern has always been as fanciful as their economics.

COVID-19 and the accompanying economic slump is a national emergency that demands spending.

Consider: For the fiscal year that ended Sept. 30, 2017, Uncle Sam ran an Antichrist-sounding deficit of $666 billion. Three months later, our Republican president signed, to party applause, a Christmas tax cut for the wealthy and corporations that was supposed to unleash a tsunami of new jobs and the tax revenues that would flow therefrom. The GOP ignored both warnings that the cut likelier would fatten the deficit and history suggesting that those warnings were sound.

Sure enough, the deficit a year later had grown by $113 billion, partly because of the tax cut. For the first time in history that year, billionaires paid a lower effective tax rate than workers. Today, the deficit is closing in on $1 trillion, with Trump's Christmas gift becoming the gift that keeps on taking revenue.

The HEALS Act would make things worse by cutting unemployment insurance premiums, Nobel laureate Paul Krugman notes. “Without those emergency benefits, laid-off workers would have been forced to slash spending across the board,” he writes. “This would have generated a whole second round of job loss and economic contraction, as well as creating a huge wave of missed rental payments and evictions.”

Fewer jobs equal less tax revenue, which equals bigger deficits and debt. American well-being, the American economy and American honesty all suffer.


Related:

Rich Barlow Cognoscenti contributor
Rich Barlow writes for BU Today, Boston University's news website.

More…

+Join the discussion
TwitterfacebookEmail

Support the news