687 replies to this topic

[Traveler]

Thanks, and I can add Authors to the non-reflation list. In all fairness, Zandi was mainly targeting the checks to folks making over 160k. Which is what Biden agrees to as well. That saves ~$200B. And cutting state aid to the states that don't need it. Another potential for overheating. Together that is about $400B. I want all of that in the infrastructure bill, which will have the deficit hawks scolding, so the more we can put there, the better IMO.

[LFC]

 Traveler, on 03 March 2021 - 12:01 PM, said:

And cutting state aid to the states that don't need it.

Politically that's going to be a tough one. "So you mean we did everything right and came out of this by scraping and scratching but there are other states that didn't so they get free money?" I look at the distribution of that money as a political minefield. Not that I disagree that it should be very much needs based, just that it's likely to be a shit show.

[golden_valley]

 LFC, on 03 March 2021 - 01:00 PM, said:

Politically that's going to be a tough one. "So you mean we did everything right and came out of this by scraping and scratching but there are other states that didn't so they get free money?" I look at the distribution of that money as a political minefield. Not that I disagree that it should be very much needs based, just that it's likely to be a shit show.

I understand the anger about it, but the people living in the states are going to suffer. While you can blame them for electing contemptible people I don't think that punishing them is going to change a thing in terms of who they vote for next time. And maybe, just maybe we need to get away from the Calvinist thoughts about who is "deserving" and who isn't, particularly when the "undeserving" always seem to be people of color.

[Traveler]

Most of those states are red. Texass in particular is the worst off. Down 12%, because they live of hefty depletion allowance taxes. But also NY got a hurt with NYC closing down.

[Bact PhD]

 LFC, on 03 March 2021 - 10:47 AM, said:

I don't see a massive pent up demand for goods though I could see a spike in services like restaurants, clubs, concert halls, etc. Of course big shots in the arms of those businesses would be pretty helpful. They have a lot of ground to make up.

The thing is, those restaurants, etc. that are still shuttered in lots of places[1] soak up food, supplies, adult beverages,...

Concur re the housing-related stuff, up to a point. Real estate seems to be flying, and so does the stuff associated with home maintenance. Roofers seem to be in high demand such that we can't get the outfit that did ours a few years ago to take a look at something -- they're too busy with re-roofs or new construction. We had our walks & patio pressure-washed about 2 months ago, and that took some doing to get scheduled. I'm not so sure about what I would call the "interior frou-frou" -- things like re-decorating, re-upholstering couches, carpeting, that involves workmen entering dwellings for lengthy stretches.

[1]Not so much here in Flori-DUH...BUT the theme parks here (Disney, eg) aren't operating anywhere near their usual seasonal levels, meaning the ancillary hotels, restaurants, shops, and entertainment venues, limo services, ad infinitum, are operating at well below their usual levels, too.

[LFC]

Manchin is fighting over the income limits for people who get COVID relief checks but the question in my mind is, why? In a $1.9T bill he's squabbling over roughly $12B. I would understand if he was trying to save a significant amount of money by going after some provision but this seems to provide a small savings in exchange for delay and no political gain on a popular provision of the bill. It feels a bit like performance art more than real fiscal responsibility.

Quote

The Biden administration made a deal with moderate Democrats Wednesday on the $1,400 direct checks in the COVID-19 stimulus package which has many observers baffled by the political calculus.

Moderates like Sen. Joe Manchin (D-WV) have been insistent on “targeting” the checks more, to make sure the aid goes primarily to low-income people that need it badly.

“We’re just looking for a targeted bill, want it to be very targeted, helping the people that need help the most,” he told reporters earlier this week when asked if anything in the COVID-19 relief package needed to be changed to clinch his vote.

There are no senators to spare in a 50-50 Senate, and the Biden administration has to cater to Democrats like Manchin to get the bill passed. But the compromise means that some people who got checks from the Trump administration now seemingly won’t get them from the Biden administration.

Now, as in the original version of the bill, single people who earn up to $75,000 will receive the full $1,400. Those who earn between $75,000 and $80,000 will receive a partial amount of that money. But those earning more than $80,000 will get nothing. Previously, people earning between $75,000 and $100,000 would get some partial amount.

For couples who file taxes jointly, those who make up to $150,000 will still receive the full amount. Couples earning between $150,000 and $160,000 will get a partial amount. But those earning more than $160,000 will get nothing. In the original bill, couples earning between $150,000 and $200,000 would get a partial check.

Those new exclusions mean that about 12 million fewer adults and 5 million fewer kids will get the direct aid checks, according to the left-leaning Institute on Taxation and Economic Policy. Some of those people got checks under the Trump administration and will be boxed out this time.

To many observers, the politics of the change are incomprehensible. It risks angering or alienating people who got checks last time, and for what? The cuts save about $12 billion, one Democratic aide told the Washington Post — out of a $1.9 trillion bill. That’s 0.6 percent of the whole package. Democratic aides told Slate that the maneuver may also help keep the Senate Finance Committee’s part of the bill under the budget cap allowed by the reconciliation process.

But progressive Democrats and political observers questioned whether these seemingly minor trade-offs were worth it.

“I don’t like that this is being narrowed,” Rep. Pramila Jayapal (D-WA) told reporters. “I feel like the survival checks are the easiest, simplest, most popular, populist, proposal.”

[golden_valley]

 LFC, on 04 March 2021 - 11:48 AM, said:

Manchin is fighting over the income limits for people who get COVID relief checks but the question in my mind is, why? In a $1.9T bill he's squabbling over roughly $12B. I would understand if he was trying to save a significant amount of money by going after some provision but this seems to provide a small savings in exchange for delay and no political gain on a popular provision of the bill. It feels a bit like performance art more than real fiscal responsibility.

It is a performance of independence. I suspect most bills need to have room in their provisions for such performances because otherwise the whole bill could fail. Bills are the results of negotiations both before they are introduced and in the hearing and voting process.

[LFC]

In a 51-50 vote the COVID relief bill moved forward in the Senate. Republicans will now throw as much sand and mud in the gears as possible but it doesn't sound like it will amount to anything other than a few days of delay.

Quote

With Vice President Kamala Harris casting the deciding vote, the Senate took a procedural step Thursday toward passing the Democrats’ sweeping $1.9 trillion COVID relief bill. Now begins the several hours — and possibly several days — of Republican parliamentary maneuverings that will delay the final Senate vote on the legislation.

First up is a reading of the freshly released 628-page Senate version of the bill. Sen. Ron Johnson (R-WI) requested the reading of the bill, and he has predicted that the stunt will drag things out for additional 10 hours. (The clerks who are actually in charge of doing the reading think that they will be able to get through it much more quickly.) Once the reading is done, there will come another 20 hours of floor debate.

Then the Senate will move on to what’s known as “vote-a-rama.” During vote-a-rama, lawmakers can put up as many proposed amendments to the bill for a vote that they want. Republicans are talking a big game for how many amendments they have planned and are promising that this vote-a-rama will last longer than the last one, which clocked in at about 15 hours.

After the vote-a-rama, the Senate will get to take the vote to formally pass the legislation. Then the bill will have to go back the House for a vote, because of the tweaks the Senate has made to it, before heading President Joe Biden’s desk.

[HockeyDon]

Traveler, on 03 March 2021 - 12:01 PM, said:

And cutting state aid to the states that don't need it.

LFC, on 03 March 2021 - 01:00 PM, said:

Politically that's going to be a tough one. "So you mean we did everything right and came out of this by scraping and scratching but there are other states that didn't so they get free money?" I look at the distribution of that money as a political minefield. Not that I disagree that it should be very much needs based, just that it's likely to be a shit show.

Then just cut aid to states that don't want it. Have every governor come right out and say whether they want this aid or not. The old "put your money where your mouth is" adage.

[Traveler]

Funny, McArdle just came out with an article implying that all the money goes to blue states. When it mostly goes to red states. Go figure. Anyone know how the funds are allocated? Teh google isn't very helpful.

[andydp]

First up is a reading of the freshly released 628-page Senate version of the bill. Sen. Ron Johnson (R-WI) requested the reading of the bill, and he has predicted that the stunt will drag things out for additional 10 hours. (The clerks who are actually in charge of doing the reading think that they will be able to get through it much more quickly.) Once the reading is done, there will come another 20 hours of floor debate.

Then the Senate will move on to what’s known as “vote-a-rama.” During vote-a-rama, lawmakers can put up as many proposed amendments to the bill for a vote that they want. Republicans are talking a big game for how many amendments they have planned and are promising that this vote-a-rama will last longer than the last one, which clocked in at about 15 hours.

After the vote-a-rama, the Senate will get to take the vote to formally pass the legislation. Then the bill will have to go back the House for a vote, because of the tweaks the Senate has made to it, before heading President Joe Biden’s desk.

Nice try Senator but you stepped on your poncho !!

The GOP thought it was over when the reading was finished at 0200. BUT...they left the Democrats in charge

The Senate was originally set to begin 20 hours of debate on the bill Friday, but at the end of Thursday's session, Sen. Chris Van Hollen, D-Md., motioned for the chamber to reduce the debate time to three hours. With no Republicans left in the chamber shortly after 2 a.m. ET on Friday, Van Hollen succeeded.

Got that? Once Senate Republicans left. Maryland's Chris Van Hollen stuck around, asked to shrink the floor debate on the relief package from 20 hours to three. Republicans intended to use as much of the 20 hours as possible, in part to drag this out, and in part to attack the popular legislation.



Why the debate on the relief bill will be shorter than the GOP hoped (msnbc.com)

[LFC]

Traveler, on 08 March 2021 - 08:22 AM, said:

Funny, McArdle just came out with an article implying that all the money goes to blue states.

Since federal tax dollars come mostly FROM blue states my reaction is, so what?

[LFC]

The Democrats made some last minute changes to the COVID relief bill to prevent Republicans using stimulus money to offset a year of state level tax cuts. They so want to cut taxes, because that worked sooooo well for Kansas, but delay the consequences so they can blame the inevitable shit-show on anything else other than the actual cause.

Quote

Eleventh-hour changes to the $1.9 trillion American Rescue Plan take square aim at one idea that’s been percolating in GOP legislatures around the country: using funds for states to finance deep tax cuts.

Over the past month, lawmakers in Kansas, Michigan, Florida, Georgia, and other states have all suggested that $350 billion in aid to state and local governments could be used to finance state tax cuts.

Mississippi and West Virginia are pushing outright elimination of the state income tax, with legislators around the country tying the push to the Biden stimulus bill.

“You would be looking at a very large tax cut for businesses that are trying to reopen in this state, which I think would be very stimulus in nature,” Florida Senate President Wilton Simpson ® said in a March 2 press conference.

But last-minute legislative maneuvering in the Senate may have rendered that impossible.

The American Rescue Plan now stipulates that states receiving the money cannot use it to “offset a reduction” in tax revenue due to any law passed during the time that the funds are available — from now until 2024.

That provision aims to ban the stimulus money from financing new tax cuts.

“In most cases, these were the same income taxes being proposed last year and the year before that,” Richard Auxier, a senior policy associate in the Urban-Brookings Tax Policy Center, told TPM. “But now, there’s an infusion of cash that could offset them.”

He added that the stimulus package had provided a brief window for many states to fund the deep tax reductions, apart from the usual justification of rapid growth thanks to low tax rates.

“What’s troubling is that the tax cut stays around, and this is a one-time infusion of funds,” Auxier added.

The move has already enraged some state legislators who were banking on billions of dollars financing deep cuts.

[LFC]

Sen. Rick Scott (R-FL***ing Asshole) has told all 50 states that they should reject the COVID relief money. No problem. I'm sure the blue states won't since they've supporting those red states for so long but if for once the red states don't have their hand out well that would be just great.

Quote

Sen. Rick Scott (R-FL) has what he calls a “simple and common sense” demand for the 50 states: reject the federal stimulus money signed into law by President Biden on Thursday.

But in sending a letter to the country’s governors and mayors, Scott created an enemy that he didn’t expect: Gov. Ron Desantis ® of his own state, who on Monday lashed out at Congress for failing to give Florida enough.

“The Senate didn’t correct the fact that Florida is getting a lot less than what we would be entitled to on a per capita basis,” DeSantis said.

Scott, as head of the National Republican Senatorial Committee, is charged with ensuring his party’s fortunes at the Senate level in the 2022 elections. But the American Rescue Plan, Biden’s $1.9 trillion COVID package, has broad public support.

Instead, Scott appears to be trying to convince states and cities to undermine the plan itself by rejecting $350 billion marked for them. He demanded that the money only be used to reimburse specific pandemic-fighting measures, and not for any deeper investments in infrastructure or economic development.

Scott pivoted to an austerity-based argument that has been widely debunked but which Republicans have wielded in the past as a cudgel against Democratic priorities.

“By rejecting and returning any unneeded funds, as well as funds unrelated to COVID-19, you would be taking responsible action to avoid wasting scarce tax dollars,” the letter reads. “After all, every dollar in this package is borrowed.”

Yeeeahhhhh, sure. Austerity. Now THERE's a Republican value ... right up until it means giving piles and piles of deficit funded payola to their wealthy donors. Spending it on a large swath of actual Americans? That's socialism!!!


I can hardly wait to see how that plays out in Florida.

Quote

It also seems dramatically unlikely to succeed, most of all in Scott’s own state. Florida is set to receive $10 billion under the plan, while eyeing a $2 billion COVID-induced budget deficit – one of the largest in the country.

[golden_valley]

 LFC, on 12 March 2021 - 02:35 PM, said:

Sen. Rick Scott (R-FL***ing Asshole) has told all 50 states that they should reject the COVID relief money. No problem. I'm sure the blue states won't since they've supporting those red states for so long but if for once the red states don't have their hand out well that would be just great.



Yeeeahhhhh, sure. Austerity. Now THERE's a Republican value ... right up until it means giving piles and piles of deficit funded payola to their wealthy donors. Spending it on a large swath of actual Americans? That's socialism!!!


I can hardly wait to see how that plays out in Florida.

Is it ideology or just a desire to own the libs that leads to this sort of proposal? He's certainly not taking care of the state by urging rejection of money to help them.

[Bact PhD]

 golden_valley, on 12 March 2021 - 02:58 PM, said:

Is it ideology or just a desire to own the libs that leads to this sort of proposal? He's certainly not taking care of the state by urging rejection of money to help them.

Both.

And DeMinimis was all set to use the stimulus $$ for...wait for it...TAX CUTS!

[LFC]

 Bact PhD, on 12 March 2021 - 03:37 PM, said:

And DeMinimis was all set to use the stimulus $$ for...wait for it...TAX CUTS!

As I noted up here the Dems put in provisions to head that off at the pass. Republicans howled because the money would actually have to go to projects that help the people rather than mostly just their wealthy donors. If there's one thing that passes as a Republican principle it's that money must flow upward. Tinkle down economics cannot fail and if it looks like it has then we just aren't tinkling enough.

[baw1064]

Well, if money goes to people who will spend it on necessities it's inflationary, while if it goes to people who already have all they need, it will produce asset inflation (a.k.a. great stock market returns).

It should be clear who the beneficiaries should be.

[andydp]

I posted this in the "Economics" section of our "Secure, Remote, Location."

I'm sure you've heard it all by now: "Only 9% is earmarked for COVID. The rest is pork"

Harking back to The Carson Show: "Not so fast, man in the moon breath !!"

From the article:

No. While a very small part of the bill is actually labeled for things like COVID testing, protective gear, treatments, vaccines and distribution, a large portion of the bill goes to stimulus programs addressing the economic impact of the COVID-19 pandemic.

The nonpartisan Committee for a Responsible Federal Budget, which itself has been highly critical of the bill, estimates a little more than 15% of the package “is spent on long-standing policy priorities that are not directly related to the current crisis.”

That would mean almost 85% of the bill’s funding is toward projects related to COVID relief, a far cry from the 9% made in claims.


www.wkyc.com/article/news/verify/covid-relief-bill/507-1af72abc-696c-408c-afae-034b5692d10d

[LFC]

Where's the tinkle down? It's almost like supply side economics is bullshit that doesn't work and we'd be better off putting more money in the hands of consumers who would actually use it to, you know, buy stuff.

Quote

On Monday, Axios reported that the COVID-19 pandemic has resulted in an uptick in the savings rate — and the bulk of this comes from large corporations and wealthy families "hoarding" money, locking it away from the greater economy.

"Thanks to the pandemic, the tendency of the wealthy socking away their money appears to be getting worse," reported Dion Rabouin. "A recent survey from Pew Research found that Americans have cut back on spending, especially at upper-income levels, over the past year. 32% of 'upper income' adults said they were saving more since the pandemic began, compared to 23% of all respondents and 17% of 'lower income' adults."

The report also found the trend in the business sector: "Cash holdings for S&P 500 companies rose to a record $1.9 trillion, while cash and investments held by U.S. nonfinancial companies rated by S&P Global rose 30% to a record $2.5 trillion in the first half of 2020."

For a variety of reasons, lower-income households save a far lower fraction of their money. This is a key reason why there has been strong support in polls for ensuring that the relief in the just-passed American Rescue Plan is means-tested, with more money going to lower-income households.