I always preface monetary columns by saying I was not an economics major, but neither is Al Franken, yet he still ignorantly pontificates on fiscal policy in left-wing magazines.
I also have worked in and around equity markets for three years, which is three years longer than the Marxist running the Senate Budget Committee.
In addition to the $2 trillion Biden stimulus, Democrats are now rallying behind a resolution that calls for a $6.1 trillion budget. Even adjusted for inflation, this constitutes more debt than we accrued to finance the Revolutionary War, Civil War, World War I and World War II. I shall accept no more complaining about post-9/11 “trillion dollar wars.”
The most outrageous aspect is that the proposed bill has very little to do with coronavirus relief.
Speaker Nancy Pelosi inserted a job-killing $15 minimum wage; a $400 billion bailout to failed states like her beloved California; and another $140 billion to teachers, even though schools never spent their first allotment and most have shut students out for nearly a year, while teachers unions resist returning to work. There is also a $400 per week bonus unemployment gift that pays many recipients more money to stay home than return to work.
Moreover, Congress already authorized nearly $4 trillion in spending from bills last year. House Budget Committee members reported there is still $1 trillion of unspent money from those bills.
One reason for the mad rush is that Democrats fear the crisis could be ephemeral. To that end, I wrote Tuesday that this week’s impeachment charade is a distraction from their crisis agenda.
Uninterested in compromise as usual, Democrats plan to use “reconciliation” to allow the Senate to plow this goodie bag through with only 50 votes.
Thanks to Operation Warp Speed, downplayed and mocked by Democrats, coronavirus cases have plunged by more than 30% the last three weeks; meanwhile, the vaccine is getting injected into well over 1 million arms each day.
Writing at CNS News last week, Hans Bader opened with this historical tidbit:
“A century ago, America went through a great plague, far worse than the coronavirus. The great influenza pandemic killed a higher fraction of Americans than COVID-19. It killed many young people in the prime of life, weakening our economy A sharp depression followed. The federal government responded not by sending relief checks to citizens, but by cutting its own spending instead. The result? The economy recovered and went into a boom, known as the ‘Roaring Twenties.’ America had never been so prosperous before, as the pain and suffering of the influenza epidemic was quickly forgotten in an era of rapid economic growth. President Biden must have forgotten this history, because he wants to use the coronavirus epidemic as an excuse to spend unprecedented amount of money.”
Former President Barack Obama, a fiscal hawk compared to today’s socialists, pushed through a massive stimulus package of around $800 billion a dozen years ago. It was too large.
But at least Obama’s stimulus package was adopted to combat an organic crisis; is that true now?
The economy was deliberately shut down last year and remains relatively strong, yet Biden insists his administration spent too little in 2009; so, he’s nearly tripling that and apparently has the backing of Obama alumni. No dissenting voices from that era are allowed.
The Wall Street Journal reports the housing market is surging, and manufacturing index has hit a five-year high. Unemployment claims are falling, and there are almost 7 million open jobs in America. The stock market has roared to new all-time highs, and in the last quarter, private sector GDP was up 4.3%.
Facts in hand, is there a Democrat courageous enough to denounce the fiscal lunacy of a $2 trillion spending bill?
James Paulsen, chief investment strategist at The Leuthold Group, recently told Business Insider that low-income Americans and minorities could be most affected by profligate spending.
“It would be sadly ironic if the aggressive actions of overuse and abuse of policies implemented today — aimed primarily to benefit the most vulnerable groups — were to eventually hurt these same groups the most.”
That’s sad. That’s also the Democrat way.