The federal government put $1,400 into my checking account. I don’t understand why I should get the check. Nor do I think many of you should get that check.
You may be thinking something like, “So, don’t take it. Send it back.” If so, just don’t. It’s not clever. It’s not original. And it totally misses the point.
The check, part of a $1.9 trillion American Rescue Plan, is supposed to help people financially harmed by the impact of Covid-19. I haven’t been so harmed. Nor have many – perhaps most – of those receiving the check.
I’ve been retired for seven-plus years. My income stream is unchanged by Covid-19. The retirement savings accounts I have did take a beating last year, but they have more than rebounded. And it was my choice to invest money that way. I could have played it safer. Covid didn’t make me play the stock market.
Obviously, some people and businesses have been hurt badly either by government-mandated shutdowns and restrictions, or by reduced business because people wisely exercised caution about mingling in crowded places.
By all means, take care of those people. The money going to me – and to the many others who have not missed a single paycheck – could be used for higher payments to those who lost their jobs, or for expanded unemployment checks.
Some suggest that the mass distribution of paychecks is a way to goose a struggling economy. That’s an argument that doesn’t pass the smell test. People like me aren’t cutting back spending because we don’t have the money. We aren’t buying because we aren’t allowed to because of shutdowns or caution. Personal savings actually were on the rise at the start of 2021. If restrictions and health concerns subside, the economy will open up. Already, airlines are seeing in upsurge in traffic from vaccinated people who now feel safe to visit far-away relatives.
So why do I care? Because this isn’t free money. It’s falling like April raindrops from a federal government that likes to dispense favors but pretends there is no day of bookkeeping reckoning. Economics is a science of sorts, and the balance sheet is a harsh master.
Both parties are notoriously guilty of ignoring their fiscal responsibility in favor of sucking up to their constituents. When it comes to deficits, “Democrats don’t even pretend to care,” says Washington Post columnist Max Boot, “and Republicans pretend to care only when a Democrat is in power.” It’s not hard to see his point.
The latest splash of generosity will lead to a deficit this year of about $3.4 trillion. That, ironically, is very close to the $3.1 trillion deficit the country endured last year. Donald Trump, by the way, promised to annihilate the debt in eight years. Instead, in four years it grew by $7.8 trillion to $27.3 trillion, a 40 percent increase.
What’s worse is that with all these years of gut-busting deficits, hardly any new money has been directed to critical infrastructure needs such as roads, dams, bridges, energy security, and technology. Those needs are still there and will be extremely expensive, whether or not they are addressed. Biden has an infrastructure package which, he says, will be paid for with a tax hike. We’ll see. Even if it is, that does nothing to address the huge debt already built up.
Trump. Biden. Republicans. Democrats. It doesn’t matter. Trump grew the debt with a tax-cut gift to the rich that he didn’t pay for with spending cuts. Biden is growing the debt by substantially changing the relationship between the federal government and its citizenry.
Both Trump and Biden are so old that they won’t live to see the negative repercussions of such wildly irresponsible fiscal practices. Those of us with children and grandchildren should be concerned. That $1,400 check – and much more – is coming out of their future.