Economists Rip Trump For Getting Coronavirus Stimulus Totally Wrong

Economists at the Center For Economic And Policy Research analyzed Trump’s coronavirus stimulus plan and concluded that he is still getting everything wrong.

According to the CEPR:

It is encouraging that the Trump administration is now taking steps to respond to the economic damage, but from what has been disclosed, its plan is poorly designed. First and foremost, we have heard no discussion of the federal government taking a direct role in providing the resources needed to deal with the crisis.

….

As people lose their jobs, tens of millions of people will not have enough money to pay their rent or their mortgage or buy food. For these people, $2,000 will not go very far. It is equal to just two-and-a-half week’s pay for someone earning $20 an hour, roughly the median wage in the economy. Without other assistance, these people will risk losing their house or apartment.

….

The Trump administration apparently also wants to bail out the airline industry, and perhaps others as well. Congress should reject such proposals out of hand. American airlines spent 96 percent of free cash flow the past decade buying back shares and 0 percent insuring themselves against a pandemic. The taxpayers should not be asked to pick up the tab for this failure of corporate leadership.

Trump is doing nothing to provide resources to the states to fight the epidemic. The $2,000 or so that he is offering the American people in corona bribes will not be enough to keep the lights on and food on the table, given the fact that Trump isn’t providing enough resources to help the virus.

The airlines didn’t plan for a rainy day. If a person mismanages their money, the government doesn’t cut them a check to solve their problems. The people who work in the airline industry need assistance, but the companies that decided to buy back stock instead of planning for an economic crisis should be on their own.

Trump’s stimulus will fail. A trillion dollars isn’t big enough to cover the economic damage that has already been done, but before the economy gets a boost, it would be a much better idea for the government to take that trillion-dollar stimulus and pump into fighting the spread of coronavirus.