As the US becomes crippled by the economic effects of Covid-19, the fiscal package that Congress is trying to implement to rescue the economy is being hampered by numerous obstacles.
Political Disagreements are Blocking Stimulus Package
The third coronavirus response bill passed the Senate despite five Republican senators being stuck in quarantine. Senators agreed on a $2 trillion stimulus on Wednesday night, but it is not certain the legislation will be approved by Congress.
The five Republicans stuck in quarantine include Senator Rand Paul, R-Ky — who has tested positive for the epidemic — while Senator Mitt Romney has been advised to immediately self-quarantine due to being in the same room as Paul. Senator Mike Lee, R-Utah, is working remotely while he self-quarantines too, as is Senator Cory Gardner, R-Colo. Sen. Marco Rubio, R-Fla. — despite interacting with Paul — will not be making any changes.
There’s Never Been a Greater Need for Remote Voting
As more politicians continue to self-isolate, there has never been a greater need for remote voting. Regardless of whether or not Congress eventually passes this legislation, the coronavirus is sending serious jitters down the spine of the US economy. As The New York Times reports, millions of people are about to be laid off and the service industry and working class is already being crushed. Public venues like pubs, restaurants and cafes are closing throughout the country. The world is on the brink of a recession.
But House Speaker Nancy Pelosi returned from recess and announced that the Democrats would be introducing their own bill to combat the economic effects of the coronavirus. She played politics during a vulnerable time for the US. Specifically, Fox News states that Pelosi was seeking a “laundry list” of items to be included in the emergency legislation, including wiping out up to $10,000 in student loan debt per person and securing election-security funding.
This is Not a Time to Play Politics
The House Speaker suggests her intention was for her bill to compliment the one being discussed by the Senate, but it is hard to believe Pelosi was not deliberately thwarting the Republicans before Wednesday morning. Although it is her duty to hold the Republicans to account, there is no time for deliberation and both parties must act, and fast, as economic confidence vanishes and the US poises on the brink of an unthinkably severe economic crash.
However, fiscal packages are never an adequate economic solution alone. The economic rescue package the White House and Congress have negotiated previously amounted to $1.4 trillion, but regardless of its final total, it is going to severely impact upon the pre-existing debts the US already has. American politicians cannot continue to recklessly spend taxpayers’ money and at some point, America needs a surplus, like it did in 1999-2001. As an election approaches, both parties must discuss how they are going to pay off their country’s debts.
Saddling Younger People with Massive Debt is Not A Sound Financial Strategy
Investopedia has suggested many ways that the US can pay off its debts. These include making it easier for immigrants to create new businesses so that they can pay the taxes that are badly needed to pay off the debt, raising the retirement age to 70 so that people can pay more into Social Security, a National Sales Tax that targets consumption instead of people’s incomes, and revamping the tax code.
Another way America can curb its spending is by ending its manifold military interventions quickly, but only when it is safe to do so.
The problem with Congress is that it has drastically increased its spending in recent decades without finding ways to finance it. Increasing debt only means that future generations will have to pay it off, and saddling younger people with debt is not a sound financial strategy.
Once the coronavirus epidemic has calmed down, US politicians from both the main parties should start discussing policies that can curb the country’s deficit as well as its significant debt. There has to come a point where both parties agree that they cannot continue to spend the way they have during the last two decades.