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Coronavirus Economics Editorial News

Editorial: Second stimulus cannot wait for Biden administration

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As COVID-19 cases skyrocket across the United States, pushing hospitals in the Midwest and Southwest as well as the West Coast to their limits, we cannot be surprised at the return of economic restrictions that will help slow the virus’s transmission.

Delaware Business Times Editor Jacob Owens

The public health concerns of the next few months are likely to dwarf those we saw in the spring. On Dec. 2, Dr. Robert Redfield, the director of the U.S. Centers for Disease Control and Prevention, told the Chamber of Commerce Foundation that coronavirus deaths could increase by 66% between now and February. That would top 450,000, a once nearly unthinkable milestone.

“The reality is December and January and February are going to be rough times. I actually believe they’re going to be the most difficult time in the public health history of this nation,” he said.

There are few among us who still fail to recognize the magnitude of our problem. I was astounded when someone put the death toll in this perspective: Right now, we are losing roughly the equivalent number of Americans every day that we did on 9/11.

More than 2,500 are dying in intensive care units every day, often separated from their closest loved ones, with no proper burial possible for the grieving. It’s a tragedy pulled from a science fiction movie that has unfortunately become our reality.

So where do we go from here?

The vaccines being developed by Pfizer, Moderna and AstraZeneca are showing promising results and should begin to get into Americans’ hands as soon as this month. But few of us should expect a COVID vaccine under the Christmas tree this year.

We will be well into the spring of 2021 before the manufacturers can create enough doses to make a meaningful impact in the spread of the virus. At that point it will be incumbent upon us to make sure all of our family members, friends, neighbors, coworkers, and more decide to receive the vaccine – that won’t be as easy as many may believe.

Until then, we will continue to wear masks, socially distance, and likely face reduced capacity limits or other entry restrictions to our favorite businesses. As we’ve heard in recent weeks, that reality will strain the ability of many business owners, small, medium or large, to keep their doors open.

We were able to stem the tide of business closings in the spring through a bipartisan federal stimulus bill known as the CARES Act. It was responsible for the Paycheck Protection Program, which pumped $1.5 billion to more than 13,000 Delaware businesses to support workers while sales and revenue were impacted. It also created direct stimulus checks to the public to drive consumer spending and enhanced unemployment benefits to make sure those suddenly out of work due to no fault of their own could support their families.

Much of that assistance expired in the late summer, however, and citizens have had to largely watch out for themselves in the months since as the economy grew in sputters and starts. To his credit, President Donald Trump ensured that some additional unemployment benefits flowed by tapping into the Federal Emergency Management Agency’s Disaster Relief Fund. It was an imperfect solution that should have been replaced by now, and likely would have if not for the optics of the 2020 presidential election.

Federal legislators are once again discussing the possibility of a new stimulus package even in a lame-duck period before President-elect Joe Biden’s inauguration on Jan. 20. A bipartisan team of centrist senators proposed a $908 billion package on Dec. 1.

That plan largely repurposes previously approved Federal Reserve lending program money that has gone unspent and would serve as a stopgap until March. It would restore federal unemployment benefits at $300 a week for 18 weeks, $160 billion to help state, local and tribal governments shore up revenue losses and $288 billion to help small businesses, restaurants, and theaters.

Former Vice President Joe Biden address the media in a speech about coronavirus in Wilmington on March 12. | DBT PHOTO BY JACOB OWENS

It’s unknown whether the proposal will gain the support of the U.S. House and Senate, much less the signature of President Trump in the last weeks of his administration. Frankly, after months of inaction from Congress amid the worst disaster this nation has seen in generations, I think we could do much worse. Democratic House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer endorsed the plan on Dec. 2, and Republican Senate Majority Leader Mitch McConnell has engaged them in discussions on a plan. It appears sticking points still remain though.

Some Democrats will say the compromise doesn’t go far enough while waiting on the bill they wrote, while many Republicans will decry the plan as unnecessary spending that will drive up the nation’s deficit, despite spending the last three years doing just that.

“There’s a reason states and localities have to have a balanced budget but we’re allowed to have a deficit to deal with crises and emergencies as we have in the past,” Biden told reporters Dec. 1. “We have to keep vital public services running, have to give aid to local and state governments to make sure they can have law enforcement officers, firefighters and educators as we did in 2009.”

I agree with the president-elect. Now is not the time to be pinching pennies for the future. Now is the time to keep the lights on.

By Jacob Owens

[email protected]

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