« The Weeds

The stimulus failure


Ezra and Matt on Trump's pseudo-federalism and Pelosi's strange aversion to automatic stabilizers.


"Nancy Pelosi says Democrats opted against putting federal aid on autopilot in their $3 trillion coronavirus spending package to avoid amplifying sticker shock" by Joseph Zeballos-Roig, Business Insider

"Trump Rewrites the Book on Emergencies" by Christopher DeMuth, WSJ

"Federalism Is an Asset" by Danielle Allen, Anne-Marie Slaughter, Josh Simons, & Carmel Shachar, Harvard


Recession Ready: Fiscal Policies to Stabilize the American Economy, The Hamilton Project

Fix recessions by giving people money - The Weeds, featuring Claudia Sahm

The case for subsidized jobs - The Weeds, featuring Indi Dutta-Gupta


Matthew Yglesias (@mattyglesias), Senior correspondent, Vox

Ezra Klein (@ezraklein), Editor-at-large, Vox


Jeff Geld, (@jeff_geld), Editor and Producer

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This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
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by on Amazon com per tonne, store and find your son many years and appropriate earn and leadership do not realise, because we had never spoken in these big terms before, if you have a stabilizer in it that something will happen next January and then you'll have four hundred five hundred billion dollars worth of of unemployment checks going at it counts in the bill to day. Welcome to another sort of the weeds on the box media podcast network. I met with glaziers here today with Ezra Klein we're going to talk about federalism in the corner virus era, but first you know we are. I think we wanted to talk about de fiscal stimulus,
measures that are or are not being considered in Congress. It SAM. It's very refreshing to me personally to see this topic because, unlike virology at something no, like a lot of half covered for years, feel very firm on and this I'm going on right. So so has Democrats put out this kind of big proposal as a three trillion dollar thing. It involves extending the bonus. Unemployment insurance involves a lot of money for state and local governments evolves, so more direct payments to households, I'm a few other sort of bits and pieces hither and yon, but there was a lot of discussion for a sort of got written of including an automatic stabilizers element in it,
which means in normal person speak that money would be triggered by a sort of some objective indicator. Right so like the unemployment rate is high and therefore extra money flows are you can get more complicated, that, but instead of assorted, nor will put it even yet to put even a little bit more sharply. It wouldn't make most of a bill like this unnecessary in the future right right, soviet what is in this bill? There is a provision to who do additional stimulus checks above the top under that article sent out or there's a provision to extend the boosted UAE two January thirty first, and if the order you no more money for small businesses to to reveal that are more staff benefits. And the idea would be that if you'd had automatic stabilizers, there would just be a provision. Somebody says these things extend until unemployment falls below five percent or whatever it might be said. She you don't have to keep writing these bills. That you're having a big political fight, overextending, something you already passed. Yeah has
urgency. Addressing has not ended right exactly and their further virtues that I've read so like in the long run. If you go back, if you look at the weeds interviews with cloudy asylum and with that, indeed, due to Gupta that I did both before corona virus happened, this was like there was no recession, but they were both author different chapters of a book called recession, ready that the Hamilton project put out and the concept there was that look. If you have automatic programmes in place for the next recession before that next recession happens, Then you are much less likely to have a severe recession because as soon as the economic indicators start to look bad instead of the stories
Yang, oh man, things are looking bad. We wonder what Congress will do and then, like twelve stories about fights in Congress, the stories will say things are looking bad. That means extra money is about to start flowing in this way or that way or another way and a means people would get the help that they need the b. It means that, just like general business people would know that, like there are problems and there is a solution coming. She wouldn't have like stock markets going up and down on the day to day basis of like weird rumours in political or like random statements from different different. Of congress- and you would actually have a more stable economy over the long haul, now we're not in that kind of like hypothetical prophylactic situation, auto materially would mean that, even if Joe Biden becomes president then suddenly Senate Republicans decide the day:
really want to see massive deficit reduction, It, wouldn't matter right that as long as economic emergency lasts emergency economic measures would continue to happen and we wouldn't see a replay of white. What really hurt the american economy and twenty eleven when a new GOP congressional majority rode into town, and I don't know exactly how to put it, but it's like you know they kind of threw a fit trying to get long term policy changes, enacted and really derailed economic recovery. First for quite a few years. On that basis, I do want to make one distinction here when you talk about the recession, ready policies, because you can imagine two things we are talking about. We talk about automatic stabilizers. One is those policies where you'd begin to build a new anti recessionary architecture into federal economic policy. Sir, I like that, might be
that whenever unemployment rises above ex per cent, you begin to get a higher. Medicate bad should be indicated by a change in unemployment insurance. There's a bunch of policies in this moment to which their size it relates to the severity of the krona virus crisis right. I dont think even if Congress was considering autumn intensity it would make a six hundred dollar boost to you. Why? Whenever there is an elevated employment rate, so in this case what would be talking about is automatic stabilizers, for, though click corona virus policies for the duration of the corona virus, procession or depression and like long story short, everybody seemed to agree on this, and this is not like some weird liberal dream. Hamilton project is considered to be a sort of like that that Bob Reuben started the Hamilton project and there were calls for automatic stabilizes from the head of the new Democrat coalition, which is like the largest
Marcus of House Democrats but considered sort of like that that the moderate Caracas and then they're not in the bill- yes they're, not in a bill to be clear, that is not going to pass a Senate anyway, they're, not not even in the bill as a bargaining chip they're, just not in the bill. Why are they not Well that well so. Policy got asked about this at one of her weekly press conferences and the answer she gave. You dont municipal, as he is not the clearest speaker in the world. This is now with Donald Trump and Joe Biden become a general fact about all our prominent political leaders but she seemed to indicate in her answer that it had something to do with how the c b o was gonna score automatic stabilizers. She said she thought it was a good idea, but they looked at it, and the way the c b o score worked. It wasn't gonna work, so I was injured
in that, because you know get, did the scipio does a lot of things, and I took her to be saying that there were some kind of technical issue with how the c b o scored automatic stabilizers that she thought was wrong or something like that that doing it in a non automatic way led to a more favourable score. You know I thought you was asserting some kind of technical flaw in the process. For an example just put opinion when they were writing the affordable care act. There were a bunch of ideas that the Obama administration, health policy people believed would reduce health care utilization and therefore keep the cost of things down, but the Scipio said that they would only score should have hard financial incentives as having that impact and that because
a big deal in the kind of construction of the affordable care act as it turned out. Actual health care spending came in way below where the Cbo had thought it would be so a lot of the disagreements that they had about that wound up not being operative. Anyway, I checked back with Pelosi's team to try to understand what she was saying there and it wasn't anything like in her point about the c b, O was just that the sea bio estimates that this recession will last a long time. So, if you make the provisions extend automatically, the cost of the provisions gets really really hot butter, but I thought you things I thought she would say he's have before us is very clear about this point. Actual ok was my first rate of prayer. Woodruff too, I think too generous to her,
and to me into the sea below was that there were some problem in the way the cb I was thinking about it, but it turns out having sheet. She said this thing about the C b: L but the city. It was actually play no relevant role here. It's just that. Yes, if you extend the measures for as long as they needed, they become very costly, but why that would be a reason to not extend them as long as they're needed is a little bit beyond me, and I wish you could get to see Biota do a hypothetical score, because the upshot should be that if you do an automatic extension, the forecast says that the fiscal costs goes up, but the forecast should also say that the economy
covers more quickly, which you would think would be the purpose of an economic recovery bell, because they do that. I mean that the score is are sensitive to the policy variables. Also, it's a three trillion dollar bill, so I mean whatever you could possibly say about this: is it's not exactly like they parked it under some? You don't again Obama here, one point just like busted out that the healthcare bills had cost less than a trillion dollars and there was pull it out came from the house even better. It came from Nancy part. Speaking speaking of his actual particular issue. Right says she wanted to be less than a trillion dollars. They stop policy reason why things less than a trillion dollars, but you know like I bought a macbook and it costs nine hundred ninety nine dollars- and you know it was like that they healthcare bill. They wanted to keep the number of zero low, but this isn't like that. It's a three trillion dollar bill, so it became a sixty,
in dollar bill like who cares trillion here trillion there. I am lake hair on fire furious about this. So a couple things about this one using the movie no country for old men. I have said at the end of it the guy forget the name of the main killer, because to the wife and Psych Unita made a promise to to kill you and she tries to make an argument about why shouldn't killer aces will look. I got this coin, I can flip that's the best I can do for you and she says that coins nothing to do with it like it's just you here and that's how I feel about the Cbo in the story. Tat legacy has nothing to do with us like the Cbo is accurately saying this is going to be expensive and if you listen to a close, I says this is really important. She goes on to say in that same statement, which I found to be a very clear point of communication from Pelosi that you know if the economy keeps being bad, they intend to keep coming back and doing more.
Bills. Well, then, what you are saying is that you should just do the automatic stabilizers, because, like you're willing to spend the money. Songs economy is bad Scipios telling you like it. My cost us much. It also might not right it's an estimate. What we'll see about the economy really is, and so you should just put it. Because also you may be in a very different situation. Come say February, right of Joe Biden wins, but Mitch Macomber routines, Senate or Joe Biden winds. But Republicans can filibuster and Democrats don't do enough in reconciliation or don't do enough with on our don't ever to filibuster, which I doubt they will under Biden like you're, not going to pass any of this you're gonna be sitting there per without presiding over like a totally disastrous recovery, and so the whole thing is
bit in its I'm a little bit infuriating its. It is infuriating so that I might say because, as I believe, what happened during the affordable care act and during a bunch of things in the Obama era that, while plus you may be, has always members who they have gotten my caught up in deficit, politics and freaking out about this, but, as I mentioned earlier, the head of the relevant caucus of the moderates caucus, not the blue dogs, which ought smaller like he was all for automatic stabilizers and what I've talked to people around Congress right now. The view is it basically, all the policy making is happening and policies office. Right I mean the legislators are far flung, though not all in Congress together right, the doom remote voting, they get it's a whole different situation that normally she's writing these bills. This bill is like like a Christmas tree of stuff in it, said in up at this, and I think just reflexive policies view that overly big price tags or bad politics for Democrats and
an election urine and so on. But this is a bad view and it's a dangerous view and would even weirder about the whole. Damn thing is this bill will not pass like it. Won't Mcconnell already said that I am going to take it up, so all we're doing at this point is putting them in as a line in the sand as an explanation of where you are, but we, the minority party, I wrote this piece. I talk in a bunch democrats in particular talk Anna some house and send a progressive like a giant Paul about like how are democrats thinking about this and Kennedy answer I got back. Was the White House his abdicated, so much responsibility? The Democrats feel they need to be the governing party. They need the governed from minority to prevent suffering, and I got a fine. But when the things I ended up arguing in peace was you can be so concerned about seeming responsible that you're not being responsible and to not put automatic stabilizers
how to spell knowing what is likely to come down the pike practically. If Democrats win is irresponsible and that's all the more true because if Mitch Mcconnell is not going to, let you pass them fine, let Mitch Mcconnell, stop you, but like fight for them, Why, instead of standing higher saying that his red lines of the state and local aid and the increased stimulus checks, that's all fine, but all that stuff should be automatically stabilized. Yes, but I mean I do think that this interact so little bit with the fact that it's not gonna be come law at all rights of theirs like these, like two ways of thinking about the like,
exercise of writing a bill and passing a bill that is just designed to sort of hang out their right, and so, like wine is well since it's a fantasy, it's not the result of political compromise. You oughta right like the best possible bit like the pure statement of principles like what would a vocs article say, should be the better than the other way to think about it, which I think is closer to policies way of thinking
Things is that, like politics is politics, so it doesn't really matter what the bill says and you just kind of cover this base that base in the other base. I dont know why she made the calculation that automatic stabilizers and a high price tag are a bad luck politically for Democrats, but I think the view would be look taking the political head of making the bill bigger could be worth doing if we were writing a law, but that since you're, not writing of real law. You're just tossing out a message: document. There is no need for it to save this kind of thing. I don't know you know like you, could go, there's a certainty and ponder ability to to that kind of thing to me
though what's most troubling, actually about leaving it out is that I tend to think that Mcconnell was gonna break on this subject of doing additional stimulus. It doesn't make sense for Republicans to kind of stare down the face of trump losing and their encumbered Senate candidates getting wiped out as the economy collapses and in other parts like they keep talking about their right. Like all this urgency to cortical reopen the economy, is I mean it's in part about the economy is in part about different views about it ideology, but it's in part about the sense that this is hurting them politically, so they're going to want to do stimulus and there's going to be a negotiation about what should be in that
and to me the most important thing for Democrats to negotiate for, like the most important thing is just that the stimulus not be arbitrarily turned off, just because Republicans lose the election in November, and I just think for pure politics like they have to be talking about that now, because the the speed with which Republican party thinking on the budget deficit evolves like it makes your head spit. You know like good one week, it's big and the other week. It's it's not like you never know and like if you don't talk about that now, if you're on plant that marker now and if you don't mind,
for it hard. Now you could totally lose. It worries things like aid to state government like that, can come and go. You know that the sort of ideological battle lines over that are very well understood. Like Democrats approve of the government spending money on things and Republicans, don't where's its precisely because this autumn antiquity thing is like so technical and weird that I thank you. Delight put it out there in front of people, but it's not even that technical and weird. I mean your thing a couple minutes ago that you're not sure why, plus he thinks it's about the for the party. As far as anybody can tell it's not about look for the party, for progress, put out a memo where they did a fair amount of pulling on automatic stabilizers and voters support. They described it in this particular part as increasing unemployment benefits when unemployment is above five percent border, supported by a fifty eight point margin. It has majority support from both Democrats and republic
since, when they describe it more vaguely, they say you know just increasing spending during a recession obtuse automatically, it's got a sixty five percent support level end of fifty two percent of Republican supported. So I really don't I mean what seems to be happening here would pose. He said I think reasonably straightforwardly is that she thinks that trying to pass a bill it costs whatever would be six trillion dollars. Let's call it, but I really don't know five trillion. Four trillion I have no idea would be about look for Democrats, a worse, looked and taken the recession very seriously, but really think forward a couple months. So I cannot say that what's gonna happen here is Mitch. Mcconnell is not going to let you pass the policies you need to pass so come election day. You know you're gonna have sixteen percent unemployment
What country are twelve percent unemployment in this country? You know something very high higher than at any point in the two thousand and eight recession and you're worried that you're going to eat that you're going to be on tv saying that we tried and they wouldn't. Let you going to be saying. The Democrats wanted to spend more money to prevent this unbelievable economic cataclysm from happening. I Jenny you don't understand the political theory there like. I often think policy has a plan, but I dont see the plan gets out like let's take a break, as I think we should talk about the economic situation that is developing access, because I think that's important context for this if you're a gig worker or self employed, there's some good news about PPP loans. You might want to consider millions of self employed workers may qualify for up to fifty thousand dollars in one hundred percent forgivable alone you might be one of those millions as the leader ppp loans. Womply can help you find out they've helped over three hundred thousand small
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and they're doing okay, you know people, people are buying stuff and it's bit weird and you never know exactly what's going on with the stock market, but part of what's going on in real life. Is that precisely because the last stimulus bill is so generous to lower wage people who lose their jobs because it's six hundred dollars extra. That's like a huge amount. If your normal benefits would be low, it's not that much if you're rich, but it has done an incredible amount to bolster the economic fortunes of unemployed people. So, even though way more people are out of a job than ever were during the great recession they have
more money than the unemployed, people had during the great recession so as bad as the economy, and I have a little factory on this. Let's do it. The expanded unemployment insurance during the great recession passed in the stimulus bill was a twenty five dollars boost to weekly benefits. This time it is six hundred dollars so it's it's a is a huge difference and it means that we are not seeing at the moment secondary recession impacts we are seeing a lot of people lose jobs because the specific place of business where they work has been hit by virus, but we are not seeing yet just like nobody
can pay the rent because they don't have any money or everyone is trying to make a giant bag of rice last all month, because I can't afford food, but those unemployment benefits are set to expire at the end of July. At the same time, tax revenue at state government has gone way way down, because in particular you rely a lot on like meal and beverage taxes. Things like that and state governments are going to need to start laying people off, and so that means we are really set up for a late summer. Economic cataclysm, where, even if, like all this reopening, goes pretty optimistically and there's no huge second wave, no need to return to lock down, but there's gonna be like up like a dump.
Hitting the economy of out of work, people needing to credibly quickly scale back what their spending of state governments, increasing the number of out of work people and then of even if- virus went away with a magic wand, just basic dislocation from nobody having money or nobody being able to spend on anything and both Ms Mcdonald S view that we should just wait and see what happens and policies view that we don't want to.
Beyond record. As wanting to spend a lot of money are very puzzling to me, I mean we can really it so hard to predict what will happen with economics generally, but when the whole economy is being held up by an emergency relief bill that set to expire at the end of July, like you really can see, what's gonna happen, all these unemployed people, if they dont get unemployment benefits. They're not gonna, have any money like it's the most predictable thing. I've ever heard up like this. No, there's no like secret other way. People can get money, so I've been talking to some economic forecasters and the way Ellie. Some of them see this going, I think, is really telling so
We're going to have as states do varying levels of reopening a bounce, particularly an balance in the not necessarily this month but like the over the summer. So, and so you might really see some months, we we millions of of jobs because we lost such a cataclysmic number right. What we lost something like thirty million jobs or we've had something thirty. I have a three or four million job, but like just somebody, back to where we have three three or four million job bumps right. So twelve million jobs come back. That means you still lost something like eighteen, twenty million jobs. But amidst that trend, Republicans who, for reasons that are whatever do not seem to want to pass more stimulus in the summer, are not going to want right going to say look, the economy is coming back. We should just keep on with reopening.
Then you're gonna have a couple. Things happen one. It is, as you know, in July, the expanded unemployment benefits end. I'm also Small business money is running out where there's more of that in in the bill that has Democrats passed, but the Senate won't take up. So a lot of those businesses are already functionally dead zombie businesses, businesses and more going to follow that right, I mean there are tons of businesses have been kept alive for while they were waiting to see what happened by PPP alone, but it just turns out the office workers we're gonna come back or you can't be, and most kids,
Is a restaurant, filling half of your tables. You can't be a bar that doesn't open until two thousand and twenty two, like those things, are not possible, and so that's like not how the revenue model works, they're going to lose a lot of them. So you're going to have like a real business closures for a lot of the people who remain unemployed the boost to their income. That is like keeping them afloat, is going to drain out of the system and so simultaneous you can have better labor market statistics, but even higher levels of economic suffering right in a funny way. We're decoupling through government policy in both directions like what is happening in the labor market, for what a lot of people
link, not everybody but but but for many people. So then, what you're going to have? It is like this extended period where it's like we added some jobs, but in the fall of that kind of ends, we very well may have a big second wave of or even multiple waves of infections as states reopen, which leads a number them to walk back down, and so there won't be the money you like it. This is gonna, stop adding more money into the economy. The economy is going to look like it's getting better. It is going to actually feel like it is getting worse for many people in it because it actually is like they lost money. They were getting and we are going to like have some of the water wash back and see how about the economic situation really is where it is not literally as bad as it looks right now, in the sense that many, the businesses that are currently closed, can reopen. Once
Public health emergency allows them to, but it is worse than people and somebody recognising, as many them will not reopen things that currently have like a signed at the top of the store front. That sign is going to go away and I got a really grim fall and that's why the automatic stabilizers were so like that's why I'm so charged up about this, because what you needed is for, like this system to be built, such a congress making dumb decisions in the summer, which is what Congress is going to do given what Mitch Mcconnell has been saying, wouldn't matter that much, but instead it's gonna matter tremendously. I mean for Democrats in some ways, like MRS all, like it's almost exactly what you want, which Mcconnell doing, because he's gonna create a total economic catastrophe when his party is one that stands to lose from that
but for the country you dont want this to happen like this is terrible. It is it. Is it going to be terrible for people? It is going to be a terrible situation for either a re elected president tromp or the next democratic president face, and I don't like we shouldn't do this yeah, so I worry that one thing that's happened is that we have adopted policies that have made some of our indicators start looking very misleading. So, like one thing, I've seen some people say is oh look at Denmark and they did things and they ve kept their unemployment rate under five percent. You know like it's a wildly different economic situation in Denmark from the United States. According to that account, but actually what they did in Denmark was. The government has given a lot of money to companies to keep people on the paper or even, if they're, not work what the american government chose to do. We give a lot of money to people who are put off
Payroll, if they're not working now, you can debate the sort of merits of that danish approach versus the american approach, but the actual outcome is extremely similar in both Denmark and the United States. Many millions of people who were working in February are not working today and almost all of those people still have money so like it's the same. There is no extra work getting done in Denmark that isn't happening here and there's no massive material deprivation happening in the United States versus what's happening in Denmark. But if you have the danish solution, then it becomes obvious from a headline indicator that if you yank the support, those people will get laid off and the unemployment rate will go up. So you have to look and say: do I want the unemployment rate to Spain
and if the answer is no, you have to keep offering the support in Amerika. It goes the other way right, like when businesses start to reopen. In a narrow sense kicking people off you. I will encourage more of them too, like go, get marginal jobs at local retailer what's but taking people off you, why is going to radically reduce people's living standards right because to be unemployed right now, today, may twenty twenty in the United States just very different from what being unemployed normally means in America? You are right now being treated much more generously than why people ever have been in american history? So it's just not as bad as it sounds, but thirteen percent unemployed meant with normal you why
and be so much worse than twenty percent unemployment. With current you, I but it's gonna sound bed right, it's gonna, sound like the economy added at such an important point: the economy just added ten million jobs in the past six weeks, the unemployment rate is falling at the most rapid pace in history read. This can be plenty to sort of take a victory lap over and I think it's a visit is an open question in the ports. Science literature, how much the actual state of the economy matters versus sort of. Speaking about the economy, and I think we already saw right like when five million people filed initial you I claims that was written up as like the worst economic thing to ever happen. Then there were like caveats about the- u I and stuff in there, but it did not generate headlines that were nearly as, but I
as a danish type, solution would have, and it means that when we go in the reverse and start throwing people off this, I do think that the coverage is going to be misleading. We're gonna, say Oh the economies, a lot stronger than it was in May when actually everybody's incomes are gonna, be lower, and I dont, if you want to know like what is much Mcconnell thinking. I think that that's what he's thinking that the unemployment rate will probably be far away as of September and October, even though the level of material deprivation maybe rising and I think it's it's legitimately a situation which the politics are weird enough, that members of Congress should consider just like doing the right thing, because it is very hard to guess like how are people going to interpret a twelve percent unemployment rate that represents, lot of fall, but also everyone's poorer, like it's very it's very confusing situation, indicator wise
and they should maybe just like- try to help people. I I'm not one hundred percent how it'll play, but I have a suspicion people notice when they become very poor. They notice when they can't pay their bills, Mitch, Mcconnell and Donald Trump, and others are going to want. You and Fox NEWS will want to channel that anger at governors and mayors who are not reopening fast enough, Frank, but also if the epidemiology is even close to crack, protect, the fall. If we are more reopened, the disease is gonna, be like spiking back up, which really does scare people, and the Democrats will be out there with somewhat larger proposals. But this again
This is why I am genuinely upset to see this House Democrat Bill because it has to, in my view, huge failures. One huge failure is it. It is not built around a central policy. That is a message anybody cares about. I am a big fan of state on local aid. It's really important. So the fact that that is what the bills are actually built around. Great, but the bills a Christmas tree. It it's like everything, including by the way, a lot of stuff. It doesn't really need to be in their ends himself. It does not super popular, and so the builders like has a lot of stuff in issues like a three trillion dollar stimulus bill. It's not like they decided to pick a fight on two issues. I am like put thing into messaging bat and coordinate with the Joe Biden campaign and like make this a thing right like the
I, like you, could imagine right Democrats getting behind a paycheck guarantee act like the Medicare crisis proposal. Instead, the dune copra, which I wish he would stop with, but whatever like eight. There are a lot of ways to do this. It could be bigger stimulus checks, it could be anything so the not doing that they also have a stabilizers in, whereas I actually think that is one of the most easily messaged things like to me. I would have preferred. Basically, you have a bill. That is two things. It is state and local aid, and then it is stable. Hers attached to the. U I attach to the state and local aid and attached to the stimulus checks. That's it! That's all it's in the bin and I'm nothing are not other worthy priorities. But the idea that Democrats want to spend money, so the support continue as long as it is needed. That is an easy message and it is the right thing to do and instead they the bill that has like a billion things and
because every interest groups getting taken care of and doesn't have, I would say at least the second most important thing of all in it and sets out I mean recognizing. The bill may not pass or the other, but if you imagine their bill passing sets up a situation where Republicans can crash the economy next year, like I want to be really clear. That is not responsible, legislating like they are doing a bad job at their job. Yeah you're, totally right that I think it's a big failure to have not built it around clear pillars. I also don't totally understand why it's one bill sure like. If it was me there would be a state local aid legislation and then it would have automaticity built into it, and then there would be legislation
on the? U, I think simply because, like reasonable people can disagree about any particular thing on this path and add the unemployment insurance happens, to have become like a big bug bear out for a number of Republicans and people in there in the business community, so like of unemployment. Insurance is one of the most disputed things in macro economic stabilization, because the way Democrats look at it unemployed. People are super high, marginal propensity to consume. Right, you give somebody some money, a person was no other income and they are gonna. Go spend that money, so they say it's super effective, now conservative say look if you pay people conditional on them not having that discourage them from getting a job suits counterproductive. So it's like one school of thought, says: unemployment. Insurance is the best stimulus and another school of thought is unemployment charges the worst stimulus and then they fight about it. A lot
am I tend to side more with the people who say it's best, but it just like, I think, would be good practice to like separate that out from other things that are good same local aid. Local aid is the opposite of that. Right, like nobody thinks to state and state government is government is like the absolute highest leverage highest cost benefit thing. A person could do in the universe at the same time, helpful, obviously the at Just then a huge economic downturn when, if you lay off the librarian she's, just going to add to the list of unemployed people like just don't lay off the library, you know, and you can put that out there and try to get republican governors to support you. You know things like that. I'm an all of it should have triggers in an objective triggers and what are the big fallacies of doing it without the trick? Sprite? Is that
They have these time. Frames are so like that's a trigger. So if you're saying, ok, we'll work and extend this and we can extend its due January, which is how the bill is written, so you're committing yourself to the view that the economic emergency will be over in January now, but no matter what you guess, there's a certain chance, you gonna get it wrong. That's why conditions based triggers a good but like January is definitely rob. That's not a guess. We're like Nancy Policy, might be right or might be wrought like it's definitely wrong, and if you ask she says it's. Why? Yes right! So she just says like what we're gonna. We can do more bills, but, like a it's, not clear that you can do more bills and be I've Democrats when the election, I would think they're gonna want to legislate on like some of these other topics, they bits handing them.
Six years talking about right, like congresses, Nano it turns out, not they just want to fight over whether to extend stimulus rather than they really so. That rate, I mean that's, what's it like insane about their site? If you ask anybody, including Nancy Pelosi, like what happened in two thousand and nine is a goal they chewed up all this time. Dealing with an economic emergency and they were unable to address as many topics as they otherwise would have liked to have addressed. So Are they doing see? Don't even if Mcconnell blocks, girls, at least you then have the bills written. You know like it's done. You build a consensus in your caucus. Maybe you'll have the majority in the Senate, but it's like. If you don't do the work now you have to do it in. February: twenty twenty one and like that, doesn't help anything or anybody am I just like you would have to have such a strong evidence behind the idea that this is better politics gigabits, we I mean about like
so high minded that I'm say disable. They should forget all about the politics, but the political theory you seem so hazy like what what's it based on. What is the evidence that, if this number went up to six trillion like you would lose everyone? It's what I do it's bad luck! I guess we're gone in circles at this point: let let's take a break and talk about federal, I'm here that they get relates absolute view. Having trouble media your goals, focusing work. If you have feeling Strasser having trouble sleeping better help is here for you, it's not a self help. Class inside a crisis line better help is secure. Online professional. Counseling with real licensed therapist, to have the tools to help. You feel better. There's fill out a questionnaire about how you're doing and better help will match you with your own licensed therapist in under forty eight hours,
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calm, slash, weeds and joined the over one million people who have taken charge of their mental health with the help of an experienced better help professional. If the last year's, how does anything it's that we don't know what will happen next, but there's one thing we can all be sure of the only future is one we can all share and leading the charge and build a future his mercy core with over forty years of humanitarian work under its belt building, together mercy course? Dna and, as the climate crisis increases their partnering with those on the front lines, making resources more accessible to farmers across the globe. Strengthening community is again Escalating natural disasters and ensuring people have the tools they need to thrive. Mercy is doing the work that matters, but they can't do alone! That's where you and I commend together. We all have the power to reshape the world when it seems like every day brings a new crisis when every news alert makes you want to throw your phone across the room. We may say feel a little powerless mercy court.
Here to remind us: we don't need to Turkey merely based action. We can make change. We are nothing if not in this together. What's next is up to all of us learn how you can be a part of what's possible at mercy core dot org. That's Our see y see Rps org. So one of the sub themes of the Trump Administration era, punditry, is that Donald Trump will do a set of things that maybe point in a lot of directions and conservative intellectuals will try to attach a principled philosophical justification to them. So Donald Trump has been doing functionally nothing hang on corona virus. He had like we are by now seventy some days after his declaration of a national emergency, and there is still not even a plan to the extent there is anything there
guidelines which he routinely ignores it in his own comments, but that Belgium has been all over the map, but mainly not doing anything. So there's been an effort among some conservatives and away, they think is worth addressing to say. You know it's great about Donald Trump. He really
just believes and federalism, which is to say, he really believes in letting states in cities, take the lead because of course, that is what has been happening in the absence of a federal response has been a lot more. Governors have had to do things that, in another context, they wouldn't have had to do in some cases thinks they cannot actually do, but this conversion of best it took to show them not put out of thin air. I'm Christine Move, who is at the Hudson Institute here at a Wall Street Journal Pinion piece on April somebody called Trumpery Rights, the book on emergencies, and he says Travis given pride of place to federalism and private enterprise, lauding the patriotism and proficiency of our fantastic governors and mayors are credible business leaders. Ingenious companies now obviously
Tromp has been attacking the patriotism and proficiency of many of our governors, which are to move sort of acknowledges House were hit his peace, but simply a problem. But who are you? What raising the amazing ones brazilian raising ones range and went through he likes on, but in a general sense. It is worth noting that you really could have a federalist approach to this, and it might even makes sense and people thought about what that would look like em the Harvard Suffer Centre for ethics, which, under Daniel Alan, has had a bunch of working groups, putting together really impressive collection of papers about what to do men took with covered nineteen.
Has a paper by Daniel Alan by M Risotto, just Simons and Carmel Har, it's called federalism, is an asset had activated to build a national pandemic programme, and one thing they show is that in a federalist approach, the federal government has a role. It needs to play very clearly and very well like what it needs to do is it needs to support state governments who are seeing their revenues collapse or they can spend the money on what they think needs to be spent on. So things like state and local aid, which is in this house bill. They need a sort of act as a scientific clearing house, because if a government has the kind of vast scientific resources who the CDC and
things that the states don't so it needs to be doing the job of centralizing that communicating it et Cetera and then it needs to be supporting and coordinating the supply chain. So states don't end up in sort of ruinous bidding wars against each other and then in supporting the states. In those ways the states can actually with the resources they need to do what they need to do, given what their local conditions are. They can move forward now that is not at all. What Donald Trump is doing he's confusing the scientific guidance talking about potential injecting yourself bleach, he has actually been creating bidding war is at times with using the federal government against states. There's a very
one thing that happened where the Republican, by the way governor of Maryland Larry Hogan, said that when he got five hundred thousand testing has himself Korea. He made them a land of Baltimore Airport and protected them with state troopers, because he was worried. The feds would take them away from him. So there has not been like a well courted hated to go cooperative relationship there, but you could have it and in many ways it makes it
because different states really are different, but you don't- and you see how much you don't between Donald Trump attacking any governors being insufficiently transactional e praise full of him and Senate Republicans proposing the need to support state and local governments at the very moment their revenues are collapsing when the federal government can issue unlimited debt and they can't wait. One also, you know the president has not articulated federalism as what he is trying to do here I mean you see that he has been tat gang governors
who don't open things up as quickly as he thinks they should be doing you out. So even on this sort of level of like federal neutralise em like we're not achieving like what's actually happening, is that Senate Republicans are wielding a kind of fiscal acts against states and then the president is encouraging protesters against state government restrictions and it's very dicey. Sidra you know, because you know the United States, it is a law governed country, but in any society it puts a lot of pressure on laws when you force the state to act and really force? No governor wants to send the police into a barber shop, a rest, the customers and the barbers, and
the home, and they really don't want to do that. If the president of the United States and Fox NEWS is going to encourage a crowd of protesters to surround the barber shop and try to defend it. And they really really really don't want to do it. If the average police officer in the United States is much more conservative than the average person in the United States and is likely to listen to the Fox NEWS hosts and the President of the United States who hail the protesters as heroes of freedom, you know like it: doesn't it doesnt work if you were gonna, be actively undermining state legislation along these things, and the president is, I think, been in
audibly successful at ratcheting up pressure on democratic governors to move more quickly than they were initially planning to do in terms of reducing restrictions, and that is an interesting use of like Bali, pulpit type powers. The present has no formal legal authority tip for states to drop restrictions, but by turning it into a controversy, polarized issue where people are not hearing. Listen to the rules. Listen to your governor, their hearing, you know, like brave freedom fighters, need to go forward it. It's a very destabilizing situation and its really the opposite of cooperative federalism in a like theoretical gonna, tap, tap construct sense. The other thing is it there? These inherently federal function related to things like air travel.
Where the federal government is not actually doing anything. At the moment like this, no screening of people who fly around the country and a hundred percent sure what the best thing to do about that would be, but I'm pretty No, it's not. Nothing is an obvious risk, particularly if you're trying to have a differentiated response at lower, levels that people are going to move from place to place and it's going to spread infection. And the United States is just like big. It's a big country in a way that you know like Singapore is small and Korea is like bigger than Singapore, but much smaller than the United States, and so that's one reason you can have a situation which, like well there's no cases in Montana, so great so Montana should tell US restrictions, but is that can mean, as the summer comes like
how many people flight Montana like, and what? What are they supposed to do about that at its very? Am I don't know what to say but, like you can just not have a federal response today and like gesture vaguely federalism is not a real answer A lot of activity is just like very interesting. Yes, well were, I guess, we're gonna try how not having a fellow response to things worked out in and see what happens here? Fair enough. Ok So with that, we will see what happens and thanks as thanks is always to our producer. Jeff rebelled and we will be back on Tuesday.
Transcript generated on 2021-05-19.