In a recent piece for this site, I suggested that the response of the Trump Administration put ideology before people. Well, Congress has just proven that theory correct with its economic package in response to the virus. To the surprise of precisely no-one, the corporate socialism rolls on while the peasants beg for crumbs. In this piece, I want to look at the provisions of the plan, sourced from a Senior Democratic Aide in the Senate. Various news articles will fill in the other details.
Background and Overview: The Package: From Original to Final Version
The watering down process that is legislative negotiation in the Senate worked its magic on this package. The grand rhetoric that was Trump’s initial address got hit in the face with the shovel that is Congress. Talk of covering ‘the cost of the healthcare for the coronavirus’ soon became covering the testing, without mention of the actual treatment. Talk of ongoing Universal Basic Income (UBI) soon became a one-off, means-tested payment. More details on this below, but you can see the bigger picture here. What began as good ideas (even if they likely did not go far enough) became weak half-measures during the legislative process. But we have not even gotten to the corporate socialism aspects yet. I would like to focus first on the weak measures designed to help the people. After an overview and setting the scene, we now turn to some of the details.
The Package, Part One: Sick Leave
You could be forgiven for thinking that the opposition to payments to, and legislative protection of, the peasants came from Republicans. However, the majority of the opposition, and caveats, to the idea of UBI actually came from Democrats, specifically the leadership, Senator Chuck Schumer (D-NY) and House Speaker Nancy Pelosi (D-CA). Originally, broad sweeping worker protections were in place, specifically a $104b package focused chiefly on paid sick leave. Then, as you might expect, cries of ‘what of the profits’ came forth on cue from the GOP. To his credit, Senate Majority Leader Mitch McConnell (R-KY), did say to his caucus to essentially shut up and vote for it, but the intent was clear.
Apparently, however, McConnell does not quite have the level of control over his troops that he thought he did. Republicans put forth amendments that watered down the bill, naturally, and now merely 20% of workers will actually receive paid sick leave. The amendments exempted some types of businesses from the paid sick leave provision and provided various other pro-corporate loopholes. Nothing changes, just the date.
The Package, Part Two a): Attack of the Democrats! Direct Stimulus and UBI
Initially, both President Trump and his Treasury Secretary supported an emergency UBI. This represented direct cheques being made out to the population to keep the economy going. Capitalism survives by people having money to spend, and UBI would have addressed this. So this was a good idea and credit where it is due. Then came the Democrats. The Week reports that House Speaker Nancy Pelosi first floated the idea of means-testing stimulus payments. The rationale was that she did not want to ‘write checks to millionaires’. The ability of the Speaker to say that with a straight face is impressive since she is a renowned corporate sellout.
The Speaker also does not seem to understand the concept of universal inherent in universal basic income. Her suggestion that writing cheques to millionaires somehow delegitimises a good idea is ridiculous. By her logic, the wealthy should not be able to benefit from medicare or other universal programmes. Such programmes are funded by tax revenue like the rest of the government. To suggest that the wealthy are somehow immune to this crisis is absurd on its face. Now, is it true that the wealthy would be able to financially weather the crisis more easily than the average person? Yes, but universal means just that: for all. Bernie Sanders’ Medicare for All does not exclude the wealthy: why should UBI? Pandemics do not care about your income level!
The Package, Part Two b): Political Ineptitude in Focus: The Democrats
Trump and his Administration are outflanking the Democrats on their left. The sheer political ineptitude of the Democrats is remarkable. The ostensible party of workers is being outflanked on the left by a faux-populist. Trump essentially said get the cheques out now – and he was right. The Democrats and their paperwork and their means-testing are precisely not what is called for in a crisis! It is this utter lack of leadership, compassion and basic common sense that will cause Biden to lose to Trump in November! How politically tone-deaf are the Democrats?! They have allowed Trump to assume the mantle of popular leader in a crisis through their insistence on playing politics. Thank you, you inept buffoons, for handing Trump a sledgehammer with which to hit you.
The Package, Part Three a): Corporate Socialism
A Senior Democratic Aide in the Senate unearthed the corporate socialism aspects of the bill
- a $500b corporate slush fund
- Weak stock buy-back language that the Treasury Secretary can ignore.
- Executive compensation limits only last two years
- Language on ‘worker retention’ is weak with various outs for companies
- No language to guarantee that workers will benefit from the bill
- Little transparency of the bailout process (how much and where it goes)
- No specific provision to eliminate eviction or foreclosure.
Ok, so we have half a trillion dollars for the corporate sector with essentially non-existent or weak as p*ss rules attached. Basically let the corporations loot the treasury and be quiet. 2008 ring any bells? Now to be fair corporations did not cause this crisis. A pandemic is genuinely unforeseeable. To that extent, I understand a limited business bailout. But the attached rules are pathetic.
Focus for a moment on one issue, stock buybacks. This is businesses buying their own stock to artificially inflate its value. This should be illegal since it is fraud: buying your own stock (which you clearly think is a good buy) which creates artificial confidence around it which you then use to sell at a higher price? The language in this bill is notably weak and places very few constraints or limitations on the money paid to the corporate sector or what they do with it. Would I go so far as to temporarily nationalise businesses (or even industries) that receive a government bailout? Perhaps that goes a little far. However, it would be a nice turnabout on the dogma of ‘privatise the profits, nationalise the losses’.
The Package, Part Three b): Austerity?
The staffer outlines more problems, but the highlights are these
- No additional funding for Food Stamps
- No funds to help with the treatment of the uninsured
In other words, the most vulnerable are on their own. Recall too that Republicans have cut Food Stamps multiple times in recent years. To not increase the meagre amount of Food Stamps, even temporarily, in the midst of a crisis shows a remarkable degree of callousness. Finally, health insurance companies will be allowed to make an exorbitant profit from this crisis on the backs of the most vulnerable.
I end with a quote from Stephen Colbert. This was done in character many years ago, and its relevance has only increased with time
If this is going to be a Christian nation that doesn’t help the poor, either we have to pretend that Jesus was just as selfish as we are, or we’ve got to acknowledge that He commanded us to love the poor and serve the needy without condition and then admit that we just don’t want to do it
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