Off the Cuff: The CARES Act vs. The Economy

The CARES Act may be good for workers, but it’s not good for the working economy. That’s the topic of my new “Off the Cuff” audio commentary.

You can listen to it by clicking on the play (arrow) button below.

 

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The Coronavirus Culpability of Ordinary Citizens

When I was a kid growing up in Colorado, my family did a lot of camping. We had a Starcraft pop-up trailer that we’d pull behind my father’s Chevy pickup, and throughout the summer we’d make weekend trips up to the mountains — sometimes by ourselves and sometimes with other families.

One particular camp-out I remember was to Grand Lake, a few hours northwest of where we lived. The area is home to the state’s largest natural body of water. We met some neighbors up there, and we stayed a couple nights on a nice patch of shore. On the second day, those neighbors were kind enough to let my me and my older brother use their aluminum canoe to venture onto the lake.

My mother wasn’t crazy about the idea. She was notoriously overprotective of her boys, but I was probably in the 5th grade by then, and the water was calm enough that she eventually caved in to our pleas. Once our life vests were on and given the parental once-over, we set sail.

I was in the bow, and my brother took the stern. Each of us had a wooden oar that we used to put some distance between ourselves and the shore. Our parents had told us not to go beyond a certain point (which was a bit ambiguous, being that there weren’t any markers, but we had the general idea).

Over the next 20 minutes or so, we roamed around in the water, staying within view of our campsite. At one point, we apparently floated out a little farther than our mother was comfortable with. She stood up from her lawn chair in front of the campfire, and motioned us back toward the campsite with her arm.

“She wants us to come in closer,” I told my brother.

“Okay,” he acknowledged.

We both began rowing, but after 30 seconds or so, I realized we weren’t getting anywhere. Worried we were caught in some kind of tide (an oddity for a lake), I turned around in my seat to better assess the situation. That’s when I spotted my brother rowing backwards, in the opposite direction. He wore a big grin on his face as he did.

“Okay, quit screwing around,” I told him, watching our mother’s arms swinging harder from the shore.

“Okay, okay,” he answered with a chuckle.

We began rowing again, and it didn’t take long before I noticed that we still weren’t making any headway. When I turned my head again, I saw that he was again rowing backwards. He broke into laughter, enjoying the expression on my face.

“Knock it off!” I shouted at him.

By now, our mother was beginning to panic. She yelled at us from the shore, jumping up and down and swinging her arms like a windmill.

For a reason I still can’t explain to this day, my brother wasn’t phased at all. He could tell (as I could) that our mother was losing it (and that was never a good situation for anyone), but to him everything was still fun and games. He laughed while I cursed him out, and when I angrily began rowing again, he — once again — worked against me.

I was at my wits’ end, and I let him know it with a fair amount of name-calling. If I hadn’t been afraid of capsizing us, I would have taken a swing at his head with my oar.

Well, our mother had finally reached her snapping point. Between our perceived inability to work our way back in, and our distorted, verbal commotion echoing across the lake, she was convinced her sons were in imminent danger. Maybe she thought we were sinking, or perhaps she feared one of us was injured. Regardless, she began running along the circular shore to get closer to us, frantic in her movements. Other adults joined in. Soon we had three people sprinting to our “rescue.”

The sight brought my brother back to reality. Realizing what he had triggered, he finally cooperated and rowed normally. We made our way to the nearest shoreline (where the adults were headed). There, I tried to explain what happened, but our mother didn’t want to hear it. As far as she was concerned, we’d had our chance and we’d blown it. Seeing that neither of us was injured, and that we weren’t taking on water, she deemed us both incompetent and incapable of navigating a canoe. She then subjected us to the humiliation of having to sit idly inside the canoe as she got in and rowed the three of us back to our campsite (where we were forbidden for the rest of the weekend from taking the canoe out again).

I’ve been thinking about that story lately, because I’ve been noticing some parallels between it and a national debate we’re currently having about the COVID-19 health crisis — specifically in regard to the economic considerations.

In order to slow the spread of the coronavirus, many state governors have temporarily shut down “non-essential” businesses and issued stay-at-home orders to citizens. The economic impact has been devastating, from stocks tanking, to small businesses struggling to make rent and payroll, to 25 million people filing for unemployment, to a likely recession.

Thus, some Americans are demanding (their sentiment echoed by members of the right-wing media) that their governors immediately rescind their safety orders and, for the sake of people’s livelihoods, “re-open this economy!”

Still, poll after poll shows that most Americans (by a strong majority) support these safety measures, believing them to be a necessary burden for the time being. And there’s plenty of data that validates their concerns.

Though COVID-19 death estimations have been scaled downward in recent weeks (and that’s a very good thing), the fact of the matter — as National Review’s John McCormack points out — is that the coronavirus killed more Americans in one month than the flu kills in a year. And that was with unprecedented lock-downs and extreme social distancing across the country.

Imagine how many more Americans would have died if such measures hadn’t been taken.

Unfortunately, sincere passion on both sides of the debate has spawned shallow and reckless accusations, mostly along the lines of one side not caring about the suffering and concerns of the other. Here are a couple of examples:

While there’s certainly a point to be made about different people’s perspectives, and who has “skin in the game” in regard to this crisis (as Michael Frankel wrote about in a thoughtful piece on this website), successfully navigating this pandemic requires a more nuanced approach than the most enthusiastic voices on either side are putting forth. Portraying the other side as monsters for their differing views achieves nothing but additional anger.

As this pertains to my canoe story (and you’re forgiven for not seeing the connection yet), it seems to me that an extraordinary amount of progress could be made under the current conditions, or even under evolving conditions, if we could at least get everyone to row in the same direction.

Last month, the president and governors alike were framing the need for extreme social distancing as a two-week initiative. Sure, there were some variations across the nation (with some leaders’ rules sounding more open-ended than others), but the basic idea was that if every citizen could do their best to stay away from others for 14-days, it would go a long way toward essentially “starving out” the coronavirus, and keeping or medical institutions from becoming overwhelmed. The science, in regard to the infection and recovery periods, backed that up.

Of course, the plan was never going to be a perfect or absolute solution due to communication hurdles, learning curves, and a mental and logistical unpreparedness to deal with such a stark change. (The mixed messages from our elected leaders and governmental departments certainly didn’t help).

But now that we’re several weeks in, it’s pretty clear that the adjustment has taken us much longer than it should have. And we as a society have run out of excuses.

Many of us have done what has been asked of us. We’ve followed the restrictions and altered how we work and live. We’ve sacrificed (some more deeply than others) for the common good. In other words, we’ve done (and continue to do) our part to row the canoe back to the shore.

Unfortunately, too many others still haven’t taken the health crisis seriously, or at least as seriously as they should. They’ve trivialized the situation, not because of a principled objection to the effort, but rather a certain level of situational unawareness. This has rolled back (or perhaps rowed back) some of our gains. All the jumping up and down from the government shoreline has brought us a certain level of success, but not to the extent we’d hoped for. Thus further restrictions have been imposed.

I should note that as a conservative, I tend to resist using metaphors in which elected leaders play the role of our parents, but in the rare context of a legitimate public health crisis, the comparison is somewhat appropriate.

The division between the forward rowers from the backward rowers doesn’t exactly line up with that of the “wait on the economy” and “open the economy now” crowds (though I’m sure it would make for an interesting Venn diagram). As such, I’m not making a pro-quarantine vs. pro-business argument, or even putting forth a public policy critique.

To me, this is largely a personal responsibility issue — those responsibilities being: keep your distance from others (especially those who are high-risk), wear a mask when you have to be close to others, practice good hygiene, and stay home when your sick.

It seems so simple, but it’s been a real slog.

Case in point, I live in Greeley, Colorado. It’s in Weld County, a little over an hour north of Denver. Weld currently has the highest COVID-19 infection rate of any county in the state. And Greeley, which makes up a very small geographic portion of the county, accounts for more than 75% of those infections.

You would think that everyone here would be awfully concerned about the situation, and quite cautious in how they conduct themselves in public. But, to my amazement, I’m still seeing an alarming number of people having casual (and physically close) conversations with others. At the grocery stores, most customers still aren’t wearing masks, or in any way covering their nose and mouth, as they brush against each other along narrow aisles. In some restaurant carry-out lines, I’m still seeing people standing just a couple feet apart.

And I’m not convinced Greeley is an exception. I hear these same stories from friends and acquaintances across the country, even in major cities that have been hit hard. While a lot of people are being careful, a lot still aren’t. Again, there’s no ill-intent (in most cases); it’s more of a social disconnect. But it’s harmful nonetheless, and it is postponing our return to relative normalcy.

If we had all done our part during those first couple weeks (or by the third week, or by the fourth week, etc.), we could have started responsible re-openings sooner. We could have spared medical professionals, business owners, and other workers a good amount of chaos. We could have kept a lot of tensions from ever boiling over, and begun our economic recovery sooner.

But we failed in that respect. We’ll get there eventually, but the societal hardships and fears have intensified. And when that happens, patience runs out. People are inclined to fall back on their tribal instincts, casting those who don’t see eye-to-eye with them as villains. Lines are drawn in the sand, and respect for order and authority diminishes.

But pinning the problem on those in authority isn’t entirely fair — not in this particular situation. The global pandemic is no more the fault of our leaders than it is our citizens. How those leaders have responded to the crisis, on the other hand, is absolutely subject to criticism. And for that same reason, ordinary citizens deserve their share of criticism too.

Because sometimes — just sometimes — the problem is coming from inside the canoe.

 




Coronavirus Immunity Testing Must Be a Priority

In early March, I began receiving patient emails from a former doctor of mine. It took me a second to realize why I was even on his mailing list, being that he had left the health clinic I go to a few years back. I quickly remembered that he’s now the owner of the preventative-healthcare clinic and gym where my son works out; I had used my email address when enrolling my boy months earlier.

Anyway, in the first email, the good doctor began sharing his thoughts on the coronavirus. He explained that he viewed it as a serious threat, and that it was becoming a world-wide epidemic. And he didn’t mince words in his description of how contagious it was and what it could do to the human body. It wasn’t a panicked message, by any means… just a candid and informed one, which I appreciated.

He also spoke of how his clinic would have a limited number of coronavirus tests available through a private lab to patients/clients (if their symptoms met the established criteria). He elaborated on the tests (which the lab ended up running out of pretty quickly) in a subsequent email, but it was this particular sentence that I found particularly intriguing:

“Additionally, very soon we will have tests available…that will tell you if you have already acquired and recovered from COVID-19. Results for this test will be immediate. These tests will become more important in the weeks ahead and might be useful to allow one to put fears to rest.”

“Important” struck me as perhaps even an understatement, not just because of what such a test could mean on a grand scale for our economic recovery, but also on a much smaller scale for my own family.

You see, there’s at least a fair chance that the coronavirus has already made it through my family. I’m not joking.

Weeks before those emails (back in mid-February), my kids and I flew out to Anaheim, California for a few days, where my wife was wrapping up a business trip. The company she works for is international, and she met that week with colleagues from all over the world, including South Korea and other Asian countries.

At the time, President Trump had only placed travel restrictions on China. In regard to infected Americans, our biggest public concern was for travelers aboard the Diamond Princess cruise ship (that had yet to even dock).

America was not on good footing to deal with the growing health crisis, and a lot of that had to do with China’s cover-up of the seriousness of the situation. We now know that China was aware of the coronavirus as early as November of last year, which means that potentially infected citizens (and citizens of neighboring countries) had months to travel to other parts of the world before serious lock-downs were imposed.

In other words, the highly contagious coronavirus had assuredly made it here to the United States long before a lot of us believed it did. Who knows how widely it spread during that time, back before we were quarantining or even really testing people? Who knows how many times it was mistaken for the flu or a just a regular cold?

Which brings me back to my family…

We’d gotten a three-day pass to Disneyland and California Adventure. The first two days were great fun, but at the very end of the second day, my wife — out of nowhere — started feeling quite sick: a low-grade fever, some chills, aches and pains, and fatigue that lasted her for the next few days. It was strange how suddenly it had come on. She could barely even get out of bed the next day, and urged us to go to the park without her while she rested in our hotel room.

Though the fever and chills went away, she didn’t feel back to normal until a few days after we’d arrived back in Colorado. That’s when I started feeling a bit weird myself over the next day or two, and both of our kids missed at least a day of school with what we thought were colds. Maybe that’s all they were; we don’t know.

What I do know is that my wife’s jaw dropped a few weeks later when she heard Tom Hanks and Rita Wilson’s description of how they were feeling before testing positive for COVID-19. It was as if they were describing her exact condition back in California. And I’ve heard a number of similar stories from others since then — stories about mysterious and sudden flu-like symptoms that occurred a week or two before alarms started sounding here in the U.S.

The timeline sure makes you wonder how many Americans have unknowingly recovered from the coronavirus (those who had relatively mild symptoms), and also how many earlier hospitalizations and deaths were falsely attributed to causes other than the coronavirus.

This seems to highlight just how important the test my old doctor described (but has had trouble ordering) could be as our country works to recover from this crisis. Because if someone has recovered from the coronavirus, the prevailing medical belief is that they are immune from getting it again (at least in its current form), and thus can’t spread it to others. People that fall into this category should be able to re-enter society and return safely to the workforce to help jump-start our economy.

In fact, Germany is already getting out in front of this initiative. As reported by The Telegraph, the German government is preparing to have researchers test hundreds of thousands of citizens’ antibodies to determine whether or not those people have beat the coronavirus. Those who have will be issued “immunity certificates” and given the okay to return to their normal lives and occupations.

Former Food and Drug Administration commissioner, Dr. Scott Gottlieb, who’s become a respected source of information and ideas for dealing with the coronavirus, also highlighted the importance of this initiative in his outline for reopening our nation.

Employing immunity testing, identification, and tracking — on a significant scale — should be a high priority for the United States right now, as we continue to social distance and care for the infected. It would hopefully eliminate a lot of the guess-work (and perhaps even overkill) currently associated with our mitigation efforts. Those who’ve come out on the other side of this virus (even if they didn’t know it) could be key in helping us bounce back from it.

Let’s hope our leaders are paying attention to what’s going on in Germany, and taking steps to emulate it. We may have a lot more people available to do some heavy lifting on the recovery than we realize. But let’s make sure first.




Trump’s Ego Is Bad for Consumers

Since taking office, President Trump has enjoyed some very good numbers on the economy. Unemployment has been low. GDP growth has been strong. And up until just recently, the stock market had been on fire. The president hasn’t missed many opportunities to tout these successes, and who can blame him?

While some would argue that the policies of the previous administration should receive at least some of the credit, it’s hard to deny that Trump and the Republicans in Congress have been good for the economy. The lifting of regulations and the tax-reform bill from last year have removed constraints on businesses, and many Americans (not just corporate CEOs) have enjoyed the benefits. Millions of workers are receiving larger paychecks, and the number of companies that have announced bonuses to their employees (as a result of the tax-reform bill) just surpassed 500.

Not exactly the economic “Armageddon” Nancy Pelosi had promised.

But one can’t ignore the recent volatility of the U.S. stock market. While 2017 gave us the calmest year for markets in over 50 years, 2018 has been a different story.

Just over three months into the new year, we’ve seen the S&P 500 change by 2% a half-dozen times. 400-plus market swings have suddenly become the new normal, and it’s not due to really anything that’s going on in the private sector, or even as a result of passed DC legislation.

It’s happening in direct response to President Trump’s ego.

Contrary to the suggestions of some in the mainstream media that the GOP’s tax bill is to blame, the market is reacting to Trump’s ill-advised tariffs on foreign imports and his public tirades against American companies — most notably Amazon.

Last year, I attended an event in Colorado Springs, CO at which syndicated columnist Charles Krauthammer offered his political insights to an audience of questioners. When asked whether he thought that President Trump had any guiding ideological principles in regard to U.S. policy (that weren’t purely rhetorical or subject to whims), Krauthammer at first answered no. He then took a moment and added that Trump might actually believe that there was an inherent unfairness in U.S. trade deficits with other countries (something the president had talked about many times as a candidate) that required rectification.

It looks like Krauthammer was right.

While the president has waffled on a number of stances since taking office (and even before), he’s been remarkably consistent when it comes to his thesis that trade-deficits are bad for the United States, and a substantive threat to our national security.

Facts and history don’t support that narrative, but that doesn’t mean much in the mind of our president, whose pride-invested dedication to this perceived injustice has compelled him to impose ill-advised trade tariffs (indiscriminately at first, but later scaled back under pressure from foreign allies) on other countries.

Trump has been nearly alone on this, even within his own party. The president’s top economic advisor, Gary Cohn, quit over the reckless venture, and very few Republicans in the U.S. Congress have voiced support. In fact, many have voiced strong opposition, and for very good reason. Driving up the cost of imported goods is foolish. It’s bad for U.S. consumers, because they’re ultimately the ones who have to pay the difference. Not to mention that other countries are then inclined to place their own tariffs on goods exported from the United States. We’re currently seeing this with China.

This is more commonly known as a “trade war,” and despite President Trump’s painfully naive insistence last month that “trade wars are good, and easy to win,” they’re not. They’re not good for anyone — especially not consumers. And the only reason we’re engaged in this self-defeating exercise (which keeps sending the stock market into a tizzy) is because of Trump’s pride.

We’ve been seeing a similar situation with the president’s numerous threats to penalize Amazon.com Inc. (and its CEO Jeff Bezos) for…  Well, seemingly just for being super successful.

Taking a page out of President Obama’s “economic justice” playbook, Trump has decided that the largest Internet retailer in the world is unfairly getting away with something by legally negotiating deals with other companies (like the U.S. Post Office) to save money and provide cheaper goods to consumers. And thus, in his view, “something” must be done to “even the playing field.”

There’s no question that Amazon’s successful practices have put a lot of other companies out of business — especially brick and mortar retailers (which include many small businesses) that could no longer compete with Amazon’s prices and efficiencies.

But this is capitalism — an economic system by which Donald Trump himself flourished under to achieve billionaire status. Why should a President of the United States (especially a Republican one) concern himself with a privately-run company (which employs over a half-million people) that is achieving enormous success?

The correct answer is that he shouldn’t. But again, this is about ego.

As the Wall Street Journal recently reported, White House officials recognized early into the president’s term that he was fixated on the false notion that Amazon was dodging taxes and taking advantage of the U.S. Postal Service. It got to the point where Gary Cohn even put together PowerPoint presentations for the president, to debunk the phony accusations and educate the president so that he could understand what he was talking about, when commenting on the company.

It didn’t work. Trump has remained on the attack, and continues to repeat the same false statements while asserting that the company must somehow be penalized. And Amazon’s stock value has been all over the place as a result.

Why is Trump doing this? According to a source close to the White House (as referenced in the WSJ piece), it’s because Amazon CEO Jeff Bezos also owns the Washington Post, a publication that Trump believes has covered his presidency unfairly. It also probably doesn’t help that Bezos is a far more successful (and wealthy) businessman than Trump has ever been.

While those who contend that Trump won’t (or won’t be able to) subject Amazon to government retribution may well be right, the act of a president waging a personal vendetta against an American retailer (the largest in the world), whose success comes from offering affordable prices to consumers, should not be shrugged off.

We on the Right certainly had a problem with this kind of thing when the Democrats would vilify Walmart. We shouldn’t tolerate it from Trump either. We should want a consumer-friendly presidency, and right now, that’s not what we’re getting.

While many Americans have benefited from the economic policies of Trump and the Republicans in Washington, those gains can quickly disappear if the country’s consumers are needlessly subjected to having to pay more for what they purchase.

I don’t know about you, but I just don’t think the pacification of a president’s ego is worth my hard-earned money.

Order John A. Daly’s award-winning novel, Broken Slate




Trust Me this Time

The Obama campaign, and the President himself are making the argument that the economy is headed in the right direction, and we just need to give his policies more time to restore the economy to the growth and strength we want.  This is not what he said when he was pushing his agenda in early 2009.  In order for us to believe this latest appeal, shouldn’t we evaluate what he said before, and how the results matched up with those predictions?

Upon being inaugurated the President set about passing legislation to deal with the bad economic situation.  His priorities were a stimulus package and Healthcare reform.  He passed the stimulus package, which cost taxpayers over $800 billion.  He also passed “Obamacare”, which was supposed to reduce the deficit and help the economy.  In June of 2009 he said, “…we can build a health care system that gives Americans the best care at the lowest cost; a system that eases up the pressure on businesses and unleashes the promise of our economy, creating hundreds of thousands of jobs, making take-home wages thousands of dollars higher, and growing our economy by tens of billions more every year.”  How’s that working out?

Republicans at the time disagreed with a majority of the provisions in both packages, so the bills passed with only Democrats in Congress voting for them.  Some say without these laws things would have gotten much worse.  That may or may not be true, but what the President predicted was much better than our current circumstances.  He said that if the stimulus passed, unemployment would not go above 8%, and that we would be down to 5.6% by now.  Unemployment, in fact, went to 8% shortly after the bill passed, and hasn’t fallen below it since.  He said that healthcare reform would reduce the deficit, bring down healthcare costs, and help the economy.  The latest report from CBO is that “Obamacare” will add $2.3 billion in debt, healthcare costs have continued to rise, and one of the biggest reasons that businesses cite for not hiring is the cost of healthcare.

Why should we think that today’s predictions will be accurate?  Has he made any changes to the plans due to the lack of results?  Has he made adjustments?  Has acknowledged what he has learned from the failure of these initiatives?  Actually, he has proposed a “jobs bill” that would spend $100 billion that looks an awful lot like the stimulus bill only smaller.

In judging the likelihood that the President knows what he is talking about in terms of the economy, we must look at his record.  The President assessed the problem, enacted his solutions, predicted the effect, and we have seen the results.  He was incorrect then, and has not changed course, so how can we trust his prescriptions going forward?  If your mechanic worked on your car, took twice as long, cost ten times more than estimated, and your car didn’t run, would he still be your mechanic?