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New data on initial unemployment claims show that 4.4 million American workers filed for unemployment insurance in the week ending April 18, according to the Department of Labor. That brings the total count of initial unemployment claims up to 26.4 million in the last five weeks of Department of Labor data, an unprecedented rate of job loss for the American economy.

The U.S. real-time unemployment rate climbed to 21.4 percent on the initial claims data, based upon 50 Economy labor market estimates. The current crisis demands public policy innovation to clear out hurdles to business formation and new employment opportunities.

Initial claims have decreased week-over-week for three weeks in a row. But the total count of unemployed American workers continues to climb rapidly even as initial claims slow down.

 

The real-time unemployment rate is calculated using March BLS data as a baseline. However, the BLS data are adjusted to count more than 1 million March work force dropouts as unemployed, recognizing that they technically categorized as out of the workforce but they are effectively unemployed. This baseline unemployment count is combined with 5 weeks of initial unemployment claims from the Department of Labor to arrive at the total count of unemployed. In sum, 35 million Americans are estimated to be unemployed by this calculation.

 

The federal CARES Act was signed into law in late March and provided more generous unemployment insurance benefits for a broader set of workers. The federal portion of the unemployment benefit was increased to a more generous $600 per week, and self-employed and gig-economy workers were allowed to use the program. These changes increased the number of claims made because workers have more incentive to apply for more generous benefits, and more workers are eligible for the benefits. In addition, unemployed workers face long odds of finding a new job now during the business shutdown.

State unemployment insurance trust funds risk insolvency as a result of incredibly weak economic conditions and increased incentives to use the program.

The coronavirus pandemic is dramatically depressing economic activity, consistent with economic research that showed the 1918 influenza pandemic depressed local economies where the virus spread most. The best case scenario for American families and businesses is that federal benefits can carry them through the worst of the crisis, and then safe strategies can be executed to reopen the economy. Americans can then resume their past economic activities and work on new jobs and businesses.

Re-opening strategies should be coupled with public policy packages that make it easy to start businesses and find new jobs. State and local red tape that has grown up around the modern economy needs to be cleaved back, and the tax code needs to be configured to incentivize new investment. Private sector disruption should be offset by public policy innovation so that the private economy can eventually come back stronger than ever.

 Michael Lucci 

President and publisher of 50economy.org

The Center Square

 

 

 

 

 

The real obstacle in rebuilding Florida's post-pandemic tourism economy will be convincing visitors that attractions and businesses are safe, hospitality and restaurant industry leaders said Tuesday.

Among ways to do that, Visit Florida President and CEO Dana Young said, is a four-phase rebound strategy that will tout industry standards being developed in restaurants and hotels tailored to specific groups.

“We are in phase one now. Phase two is when the stay-at-home order is lifted,” Young said during a teleconference of the Re-Open Florida Task Force’s 35-member Working Group on Tourism, Construction, Real Estate, Recreation, Retail and Transportation.

When Gov. Ron DeSantis’ safer-at-home order is lifted, Young said, tourists are not going to immediately flock to the state because the COVID-19 crisis “has changed consumer behavior and psychology.”

They’ll need to be induced, she said, and need to see businesses are open and attractions are safe. To do that, she said, the state should enlist Floridians to show the Sunshine State is open for business.

“People who live in the state will be incredibly important. The entire tourism industry needs to encourage Floridians to take an in-state vacation,” Young said, calling on the group to appeal to “state patriotism that Floridians already have in abundance.”

Phase three will target national travelers, and phase four will be “expanding these efforts globally,” she said.

There are indications the state’s tourism and hospitality industries may recover sooner than later, Young said, citing an 11-fold recent increase in visitors to Visit Florida’s website, which now includes a dashboard charting the shutdown’s impact on the state’s largest industry.

The questions industry leaders must answer is how to develop a “data-driven approach” and protocols “for employees in the public space” in businesses now shuttered as nonessential.

Fontainebleau Miami Beach President and COO Philip Goldfarb said among the first items that could be addressed is encouraging business travel as a precursor to leisure travel.

“Consumer confidence is going be at the root,” Goldfarb said, asking officials “to encourage the media to donate more time to public service messaging.”

Tim Petrillo, co-founder and CEO of The Restaurant People, which operates 45 restaurants nationwide and 25 in Florida, said business owners are concerned about supply chains.

“There will be significant strain on supply chains as everybody tries to get open” at the same time, he said.

Employers need “a clear path” in how they can operate safely.

“What does outdoor dining look like? How do we enforce social distancing on our guests?” Petrillo asked.

“These guidelines have to be easy to follow,” said Cody Khan, owner of Holiday Inn Resort in Panama City Beach. “We don’t have PHDs cleaning rooms and washing dishes.”

The framework may already be in place, such as measures being implemented by Restaurant Brands International, which operates 18,000 Burger King restaurants, 4,500 Popeyes restaurants and 4,000 Tim Horton’s restaurants globally, CEO Jose Cil said.

The company developed protocols with the CDC to screen employees before shifts with a short questionnaire and a temperature check that is logged daily. The company also has adopted a paid sick leave policy.

“We made it a policy early on, anybody who comes down with this, go home to get better. We will pay sick leave for 14 days,” he said.

Hoteliers said protocols developed in Singapore and Las Vegas, including electrostatic deep cleaning and other standardized best practices should be incorporated into the state’s marketing plan.

The hospitality industry must now consider, “What does the guest room of tomorrow look like?” Boca Resort and Club President and Managing Director John Tolbert said.

“If we are going to reopen, we have to have amenities,” Goldfarb said, adding he is “hearing through the grapevine” that south Florida beaches may not open for months. “I think that is a big mistake.”

Gov. Ron DeSantis will call on lawmakers in 2021 to divest state investments in Chinese-owned companies and “hold China accountable” for withholding information about the COVID-19 outbreak until it was spreading across the globe.

DeSantis told reporters he will push Florida to “put our flag into the ground” and incentivize companies now operating in China, especially pharmaceutical and medical equipment manufacturers, to come to the Sunshine State.

“If you have life-saving equipment that is being manufactured, do not manufacture it in China anymore. We need to bring this stuff back to the United States, and Florida would be a great place to do it,” he said. “If you want a good, business friendly environment, come talk to me. We can work something out.”

DeSantis said Florida is likely to file its own lawsuit against the Chinese Communist Party seeking compensation for the economic damage caused by the pandemic shutdown or sign onto one filed this week by Missouri and Mississippi.

“I want to see if Florida can be involved in that,” he said.

DeSantis’ comments came as President Donald Trump and Congress are considering whether, and how, the U.S, can penalize China for failing to alert the world to the Wuhan COVID-19 outbreak.

In a letter sent Wednesday to U.S. Secretary of State Mike Pompeo, Florida Chief Financial Officer Jimmy Patronis asked for “technical assistance” from the U.S. State Department in providing a list of Chinese-based or Chinese-bought companies and their subsidiaries that operate in Florida.

Patronis said the state’s Department of Financial Services' Division of Unclaimed Property has $2 billion in unclaimed assets, some of which could belong to Chinese companies or the Chinese Communist Party.

“Clearly, if another nation attacked our country, and inflicted the kind of economic harm that is being brought to the American economy, we would demand restitution,” Patronis wrote. “I am of the opinion that China has a debt to pay to our country, and the state of Florida, for their negligence and deceptive practices.”

The Department of Financial Services could turn names over to the Board of Administration, which manages state investments, including those made on behalf of the Florida Retirement System (FRS), the nation’s fourth-largest public pension fund.

According to the state’s Department of Management Services (DMS), as of June 2019, FRS provided retirement income benefits to 647,942 active members, 4.425 million retirees and 32,670 others.

In October, the Trump administration blacklisted Hangzhou Hikvision Digital Technology Co., one of the world’s largest video surveillance systems manufacturers, for providing the technology the Chinese Communist Party has used to repress western China’s Muslim population.

FRS was among American public pension programs that had invested in the company, owning 1.8 million shares in June 2019.

Divesting in Chinese companies is not, necessarily, the same as disentangling economically with China.

Enterprise Florida has operated offices in Hong Kong and Shanghai since 2014. The agency’s 2018 International Business Highlights report ranks China as Florida’s No. 1 import market and No. 3 merchandise trading partner. China is the Port of Miami’s top customer.

More than 200,000 Chinese tourists visit Florida annually, according to Enterprise Florida.

DeSantis touted his long opposition to the Chinese Communist Party and China’s trade practices, noting DC Think, a Beijing-based think tank administered by Tsinghua University, in a June 2019 U.S. Governors Report, warned Florida’s governor was not “friendly” to China’s interests.

“Where do you think I was” ranked he asked before answering his own question: “Hard-line against China.”

John Haughey

The Center Square

“No Shirt, No Shoes, No Mask, No Service.”

Get used to it. You may see it on storefronts and office doors soon.

The phrase was among the ideas presented during Thursday’s teleconference of the 23-member Re-Open Florida Task Force Industry Working Group on Administrative, Education, Information & Technology, Manufacturing, Utilities and Wholesale.

The group, led by state Education Commissioner Richard Corcoran, discussed reopening K-12 schools in August on Wednesday, with Thursday’s session mostly focused on manufacturing and information technology businesses.

Corcoran’s group is one of four subpanels set to forward ideas to the Re-Open Florida Task Force’s 22-member executive committee, which must present Gov. Ron DeSantis with a statewide reopening plan Friday.

Enterprise Florida Senior Vice President Manny Mencia said many manufacturers could restart production and meet safety protocols quickly if supply lines were restored.

“A large majority of (Florida manufacturers) have seen a sudden and steep decline in their sales and revenues,” Mencia said. “This is happening while they’ve also been experiencing a significant disruption in supply chains.”

Venice-based Tervis, which manufactures plastic drink tumblers, has not escaped the economic fallout from the response to the COVID-19 pandemic, but president Rogan Donnelly outlined how it plans to safely resume full operations.

Tervis plans to check employees’ temperatures before entering its plant, provide masks, disinfect regularly and impose social distancing in its workspaces, he said.

“We are investigating the use of temperature guns or thermal cameras,” Donnelly said.

The company is concerned about the reliable availability of thermometers, he said, noting they are “hard to find and are on back order.”

Tervis wants its employees properly trained, Donnelly said.

“Taking an employee’s temperature puts HR at higher risk, potentially exposing themselves to the virus,” he said. “Our HR team is not certified on how to actively take a temperature. So, we need to find someone who can train or certify our team, and to identify clear policies about which temperatures are too high, and what happens if a person has that temperature.”

Florida Technology Council Chief Executive Officer James Taylor offered suggested best practices for the IT industry that include daily self-screening for employees and clients; in-house social distancing; training on how to use personal protective equipment; a 30-day supply of personal protective equipment, sanitizer, soap, and other such supplies; disinfection and cleaning protocols; and signage.

His suggested sign: “No Shirt, No Shoes, No Mask, No Service.”

Taylor said the key to getting “the onus off the state and put it back on the businesses” to determine when they are ready to reopen is clear guidance and protocols.

“By meeting these different protocols, it allows them to say, ‘Yes we can do that. We’re in a position to open right now,’ ” he said.

Broward College President Greg Haile said economic crisis typically results in college and technical school enrollment boosts, but, with the COVID-19 pandemic, all bets are off.

“This is unlike anything we have ever seen,” Haile said.

Miami-Dade County Early Learning Coalition President Evelio Torres said with K-12 schools closed at least until August, any plan to reopen the economy must address child care and provide operators with resources to ensure they are safe.

“Full social distancing in a child care setting is practically impossible,” Torres said. “So the ones that are open may not have enough personal protection equipment due to the shortages. A lot of them are making do with what they have. But this is a concern to the staff, a concern to the parents, as well to owners and directors.”

John Haughey

The Center Square

Saturday, 25 April 2020 10:30

Whitmer to Michigan: Stay Home and Shut Up

When historians look back at America's handling of the coronavirus outbreak, they likely will cite Michigan Gov. Gretchen Whitmer as the best example of how not to contain a pandemic in your state.

The Democratic governor has turned her state into the heart of COVID-19 resistance. On Wednesday, protesters shut down the roads in Lansing, the state's capital, in a protest dubbed "Operation Gridlock."

Whitmer responded to the outrage of her constituents thusly: "I know that people are angry and that's OK, and if you want to take it out and send it my way, if it makes you feel better, that's fine. I support your right to free speech, and I respect your opinions. I just urge you, don't put yourself at risk and don't put others at risk either. I was really disappointed to see people congregating, not wearing masks. I saw someone handing out candy to little kids bare-handed."

She did everything but brand her critics "barbarians at the gate" -- unwashed hordes who stand against the good people who stay home and don't make waves -- when her provocative attitude and policies truly were a problem.

Consider the name of her stay-at-home orders: "Temporary requirement to suspend activities that are not necessary to sustain or protect life."

Her order should have prohibited activities that spread the virus -- that's what public safety requires. Instead, Whitmer took her moment of power to tell her own constituents that they should not do anything that possibly could make their confinement more pleasant or productive.

An example: "Private gatherings of any number of people occurring among persons not part of a single household are prohibited." So if you're a healthy single person, you can't sit down with a neighbor. It doesn't matter if you practice social distancing. You are not supposed to exercise your judgment. Your purpose is to obey.

Large retailers can't sell paint or plants. Gardening centers in large stores are illegal.

If residents have a second home, they are not allowed to go to it.

Wolverines can kayak but not use a motorboat. Somehow that is supposed to save lives.

It's one thing to be told you have to social distance, work at home or not work to contain the spread of COVID-19. It's another thing to be told, in effect, you can't plant tomatoes or people will die.

Whitmer has a talking point that explains her invasive rules.

Former NFL player and Michigan resident Mark Campbell, who recently visited the White House, told President Donald Trump that he believed he contracted the coronavirus when he touched a gas pump during a ski trip. Campbell has since recovered.

Whitmer frequently shares Campbell's story. She then notes that COVID-19 can live on stainless steel for 72 hours. "Think about how many people touch a gas pump handle in the span of three days and that's why we don't want anyone on the road who doesn't have to be there," she recently told reporters.

One word: Gloves.

Another: Sanitizer.

Americans now know which measures should be taken when touching surfaces that many others have touched -- even if Whitmer assumes voters, including savvy first responders, have no common sense.

Whitmer's name pops up among possible running mates for former Vice President Joe Biden. Her criticism of Trump's handling of the outbreak raised her profile. Ditto Trump's warning to Vice President Mike Pence during a coronavirus task force briefing not to call "that woman from Michigan." (Pence nonetheless has called her.)

It gave Whitmer's brand a boost when she appeared on "The Daily Show" wearing a T-shirt that said, "That woman from Michigan," and insisted she has no energy for politics.

Maybe her next T-shirt could say: "Nanny state scold."

Even Trump, albeit with the help of Drs. Deborah Birx and Anthony Fauci, has been able to unite the country behind social-distancing guidelines. By going too far, Whitmer has discredited that very effort.

Debra J. Saunders

President Donald Trump unleashed his "April surprise" on Monday night, sending shock waves from the Beltway Swamp to Silicon Valley with a long-overdue announcement: "In light of the attack from the Invisible Enemy, as well as the need to protect the jobs of our GREAT American Citizens," he declared, "I will be signing an Executive Order to temporarily suspend immigration into the United States!"

The usual suspects inveighed against the still-unseen proposal early Tuesday morning. My inbox was flooded with twitching and moaning from Americans for Prosperity, the Koch Foundation-funded outfit, which called a freeze the "wrong approach" and the Southern Poverty Law Center, which ranted (as usual) about "white nationalists" and "racism." The infuriated Council on American-Islamic Relations condemned the "irrational and insidious" plan (that no one had yet seen) and called for "people of all decency" to "denounce this xenophobic agenda." Lawsuits are already being prepared against an executive order that hasn't been written or signed.

For nonhysterical observers of the Trump administration, however, the outcome was perfectly obvious: initial excitement followed by abject letdown as actual details have trickled out over the last 48 hours.

Do not forget: 26 million American workers across the wage scale are out of work as a result of pandemic-induced lockdowns and layoffs. Dire straits demand extreme measures. The well-being of our native workforce and the millions of families dependent upon them must be Washington's top priority, not big business, big agriculture, Silicon Valley, academia or foreign countries clamoring to send their students and workers here to replace ours.

Despite White House Press Secretary Kayleigh McEnany crediting Trump on Tuesday morning for understanding that "(d)ecades of record immigration have produced lower wages and higher unemployment for our citizens," at his Tuesday evening press conference, Trump revealed that the prematurely heralded and scorned immigration suspension will last a mere 60 days and will exempt temporary foreign visa holders.

Head. Bang. Desk.

This is a cynical betrayal of the burgeoning "America First" movement. It's all moratorium hat and no cattle:

--All new green card applications and routine visa processing were already suspended on March 20.

--Refugee resettlement was already suspended the same week and is scheduled to be frozen until at least May 15 (although more than 1,000 Afghan refugees were flown in over the past month while the rest of us have been ordered shut in our own homes).

--Foreign travelers from China and Europe, plus Canada and Mexico, were already barred from entering (though thousands of H-2A and H-2B agricultural and seasonal workers got in and some 35,000 more expect a green light despite virus outbreaks at Chinese-owned meat plants packed with foreign laborers).

--The annual H-1B lottery for Chinese and Indian tech workers was completed last month and a total of 475,000 H-1Bs are safe while untold thousands of American STEM students, graduates and workers lost their livelihoods.

--Despite massive layoffs of H-1B workers in tech, there is no move to send them home. Instead, immigration lawyers are outrageously advising H-1B and other temporary visa holders (including those in the L-1, B-1 and R categories) that they are eligible for stimulus checks.

--More than a million F-1 foreign student visa holders remain in the country, including nearly 400,000 from China, as do hundreds of thousands of foreign students who secured Optional Practical Training work permits in STEM fields, displacing American workers.

--More than 4,000 J-1 foreign health worker visas were freed up earlier this month while American medical professionals lost their jobs. The American Medical Association, which has artificially suppressed the supply of doctors for decades to inflate wages, is whining about shortages and pressuring to relax J-1 rules and time limits even further.

The clamor for an immigration moratorium has been steadily rising, from Pat Buchanan's advocacy, dating back to his first presidential campaign in 1992, to immigration hawk Jeff Sessions' call for an employment-based visa freeze last week. With a whopping 79% of Americans now in favor of a full halt to immigration (according to a recent USA Today/Ipsos poll), this was Trump's golden opportunity to seize momentum. Instead, we got a mess of squander and blunder.

Secretary of State Mike Pompeo is more interested in appeasing India than protecting American workers. White House adviser Jared Kushner and his top aide Christopher Liddell (former Microsoft executive) have prioritized appeasing Apple and Amazon. I've learned from insiders that there are at least 15 categorical exemptions on the table and more in the works.

A one-time, 60-day Swiss Cheese-holed farce of an immigration ban will do far more harm than good for Donald Trump. Think about it this way: Various illegal immigration ethnic blocs have been granted "Temporary Protected Status" continuously since 2001. Why do hordes of foreigners get a permanent reprieve while American citizens will be asked to settle for a measly comma before getting drowned again in mass migration? The executive order should cover all foreign influxes and should be renewed for at least as long as the longest TPS extensions: 19 years.

We need Permanent Protected Status for American citizens. Full stop.

michelle malkin sm

Michelle Malkin's

America's domestic energy producers are under siege. The price of oil fell to below $5 a barrel on Monday, down from roughly $50 a barrel a year ago. This 90% drop in price is sending nearly the entire oil and gas industry into bankruptcy.

What is going on here?

Saudi Arabia and Russia have flooded the international market with cheap oil at the very time of a massive drop in demand due to the coronavirus pandemic. This "perfect storm" for America's drillers sent prices into this unprecedented tailspin.

Low prices are good news for American motorists and manufacturers, for sure. Get ready for $1 a gallon gas prices in some places. But the market saturation in cheap oil is a scheme by the Saudis to regain the power they lost when innovative U.S. drillers cracked the code to unleash the most prolific and unexpected oil and gas boom in the history of North America.

Because of their grit and determination, and for leading us out of the 2008 to 2009 recession, I love this industry. I wrote a book about the frackers in 2015, and, for full disclosure, I get some limited funding from energy firms. Under President Donald Trump's policies, which were highly supportive of American energy independence, the U.S. became a net exporter of energy, and OPEC's energy dominance was over.

But now, Russia and Saudi Arabia want their price war to shut down American energy production while the world isn't looking. They are succeeding.

Many small- and medium-sized producers, from Texas to North Dakota and Pennsylvania, have been shutting down and are even fighting off bankruptcy. These companies are amazingly resilient and are experts at slashing production costs for the sake of survival. Almost no one (other than radical environmentalists) favors decapitating an industry that has made America an energy powerhouse, created as many as 5 million new jobs, and almost single-handedly pulled our nation out of the 2008 to 2009 recession.

Oil remains one of the necessary elements in society's ability to prosper and function. For example, the blue-collar jobs in oil production, transportation, refining, and petrochemical manufacturing were all deemed "essential workforce" (even in California!) during this period of national emergency. It would be dangerous and shortsighted to hand over energy production to foreign regimes that are less than friendly to the U.S. and have proven themselves to be less than dependable suppliers.

One smart retaliatory move would be to slash the taxes paid by our onshore drillers and royalties on drillers in the Gulf of Mexico and on federal lands. These royalties paid to Uncle Sam can range from a "tax" of between 12% and 18.5%. Ending the royalties through the end of the year would lift the after-tax price paid to drillers by as much as $5 a barrel. This would apply to about 4 million barrels of oil per day on federal properties.

The feds now collect about $6 billion a year in royalties. Canceling those payments would be a small price to pay to save an industry that employs several million workers. Under federal law, the president has the executive authority to take this action.

America has become the world's largest oil and gas producer -- and the Russians and the Saudis want to end that supremacy. Trump can and should make sure they don't succeed by slashing the taxes and royalties this critical industry pays until the coronavirus crisis is over.

Stephen Moore

Saturday, 25 April 2020 09:48

Beware the Left's 'Degrowth' Movement

It would be natural to believe that nearly everyone on the planet is horrified by the death and economic destruction wrought from the COVID-19 pandemic. But some see the body bags and the shutdown of economic production as a weird kind of blessing in disguise.

These are the proponents of a radical and increasingly chic movement on the left called "degrowth." This is the idea that economic growth and increased prosperity are the root CAUSE of massive ecological destruction and health pandemics. The agenda is to shut down industrial production and industries like fossil fuels, automobiles and airline travel that contribute to global warming. COVID-19 and the economy lockdown are seen as a kind of test run for the theory.

For example, professor Natasha Chassagne of the University of Tasmania and a disciple of this movement gushes that "we can draw many lessons and opportunities from the current health crisis when tackling planetary warming."

A former high-ranking climate adviser to the Obama administration, Jason Bordoff, writes in Foreign Policy magazine that "COVID-19 may deliver some short-term climate benefits by curbing energy use, or even longer-term benefits if economic stimulus is linked to climate goals," but he adds almost regretfully that the "benefits" from the pandemic in terms of less carbon emissions are likely to be "fleeting and negligible."

Degrowth is defended by its proponents as "a political, economic and social movement based on ecological economics, anti-consumerism and anti-capitalism."

The official degrowth website explains that COVID-19 is "an example of why degrowth is needed; it shows the unsustainability and fragility of our current way of life. Additionally, the response to covid-19 has shown that degrowth is possible, because society (and the state) has demonstrated an ability to dramatically change the modus operandi in response to a major crisis."

The philosophy that increased prosperity is the problem and not the solution to our societal problems is not new. In the 1970s, many on the left embraced the "limits to growth" ideology of too many people, too little food and energy, and imminent ecological disaster. Those ideas were discredited over the ensuing 40 years as innovation and technology, plus a renewed appreciation of economic freedom, advanced rapid growth in living standards around the globe and massive surpluses of food and energy.

Of course, the origins of the limits to growth and, now, degrowth movements date back to the days of Thomas Robert Malthus, who famously and wrongly predicted that population growth would always outpace food and economic production. These rotten and dangerous ideas are back in vogue, and the New Yorker magazine recently highlighted the fad on college campuses and in faculty lounges. It's the latest of leftist extremism -- a subversive movement to keep an eye on.

What is scary is that many who subscribe to climate change hysteria, as well as the donors who provide the tens of billions of dollars of resources to climate issues, have come to agree that growth is the enemy and that we would all be better off if we were a little poorer.

It is wrong on so many levels one hardly knows where to start. First, economic freedom and growth go hand in hand and have inarguably positive benefits to the poorest citizens of the world and to health and the environment. Nations that have degrowth are much more polluted and have much higher death rates than the United States.

Environmental protection is the ultimate "superior good." The richer a society becomes, the more they spend on clean air, clean water and nature preservation.

The degrowth fad -- hopefully it is just that -- also reveals the modern left movement for what it is at its core. It is anti-growth, anti-people, anti-free enterprise and anti-prosperity. The entire climate change movement is an assault against cheap and abundant energy and rising living standards. This raises the question of how we could ever rely on the left to fix our economy, help the poor and make us all more prosperous if their goal is to shrink the economy, not grow it?

Stephen Moore

Saturday, 25 April 2020 09:46

The One Certain Victor in the Pandemic War

"War is the health of the state," wrote the progressive Randolph Bourne during the First World War, after which he succumbed to the Spanish flu.

America's war on the coronavirus pandemic promises to be no exception to the axiom. However long this war requires, the gargantuan state will almost surely emerge triumphant.

Currently, the major expenditures of the U.S. government, as well as a growing share of total federal spending, are Social Security, Medicare and Medicaid.

None of these programs will be curtailed or reduced this year or next. And if the Democrats win in November, the nation will likely take a great leap forward - toward national health insurance.

Republicans are calling for a suspension until 2021 of payroll taxes used to finance Social Security and Medicare. While that would provide an economic stimulus, it would also blow a huge hole in federal revenue and further enlarge the deficit and national debt.

Even before the virus struck with full force in March, that deficit was projected at or near $1 trillion -- not only for fiscal year 2020 but for every year of the new decade.

The next major item of the budget is defense, considered untouchable to the Republican Party. Hence a confident prediction: This generation will never again see a budget deficit smaller than $1 trillion.

Indeed, the $2 trillion lately voted on to save businesses and keep paychecks going to workers will lift the deficit for 2020 above $3 trillion.

As of March 1, 2020, the nation was at full employment, with the lowest jobless rates among women and minorities in our history.

Less than two months later, 26 million Americans are out of work.

These workers will soon begin picking up unemployment checks, a new burden on the federal budget, to which will be added the cost of expanding food stamps, rent supplements and welfare payments.

Consider education.

Though Harvard, with its $41 billion endowment, was shamed into returning the $8.7 million in bailout money coming its way, does anyone believe the stream of U.S. revenue going into higher education will ever fall back to what it was before the pandemic?

As for that $1.5 trillion in student loan debt, is it more likely that vast sum will be paid back by those who incurred the debt, or that it will be piled atop the federal debt?

Congress has already voted to bail out our stressed hospitals.

Now, standing patiently in line for their bailouts, are the states -- and America's cities and counties. These governmental units are virtually all certain to face falling tax revenue and expanded social demands, leading to exploding deficits.

Their case: You bailed out the businesses and the hospitals. What about us? When does our turn come?

Majority Leader Mitch McConnell, anticipating the mammoth bill for bailing out states and cities, has suggested that governments be allowed to use bankruptcy laws to write down and write off their debts.

Probably not going to happen.

Recall what happened when President Gerald Ford told New York City that Uncle Sam was not going to bail out the Big Apple. "Ford to City: Drop Dead!" was the famous headline splashed across the front page of the New York Daily News.

Ford recanted but did not recover. His perceived callousness in the face of New York City's crisis -- though that fiscal crisis was entirely of the city's own making -- factored into his defeat by Jimmy Carter.

Donald Trump is not going to give Red State governors facing gaping budget deficits because of the coronavirus crisis the wet mitten across the face. For his political future will be decided by those states.

Still, the cost of bailing them out promises to be enormous and to create a precedent for bailouts without end.

Then there is the clamor, already begun, from, and on behalf of, the Third World. The IMF, World Bank and the West, it is said, have a moral obligation to replace revenue shortfalls these nations are facing from lost remittances from their workers in the developed world.

There is talk of hundreds of billions of dollars in monetary transfers from the world's North to the world's South.

Anti-tax activist Grover Norquist once famously declared: "I don't want to abolish government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub."

What is more likely to be drowned in that bathtub is the philosophy: "That government governs best which governs least."

What is more likely to be drowned in that bathtub is the philosophy that champions small government, the primacy of the private sector, a belief in "pay as you go," and that "balanced budgets" are the ideal.

Call it Robert Taft conservatism. Today, it appears irrelevant.

Indeed, the one certain victor in the coronavirus pandemic war will likely be Big Government. As John Donne wrote, "No winter shall abate this spring's increase."

patrick buchanan small

Patrick J. Buchanan

Saturday, 25 April 2020 09:22

Joe Biden Cannot Run on Raising Taxes

President Donald Trump began the year in a strong position to win reelection, in large part due to the best economy in generations. Under Trump, the unemployment rate had fallen to around half-century lows, workers (and disproportionately low-income workers), saw their first real wage gains in a decade, and people reported record confidence in their personal finances.

But thanks to the coronavirus and the resulting lockdowns, in a matter of weeks, the economy came crumbling down, with 22 million people reporting joblessness in the past month alone and second-quarter GDP loss projections reaching as high as 40%.

All of this poses a problem for Trump. But it's possible that it proves an even worse one for Joe Biden.

Although the de facto Democratic presidential nominee ran well to the center of the majority of his competitors, Biden still took the bait to endorse many of their policies, including a pledge to repeal Trump's Tax Cuts and Jobs Act. The media worked overtime to convince the country that the law was a tax cut for the wealthy, and that may have worked for a time. But two years into Trump's first legislative achievement, the people know better, namely, that unless you're a high-dollar, white-collar earner in a heavily blue state and, thus, slapped with the SALT deduction cap, it was overwhelmingly likely that you saw a tax cut.

It's one thing for Biden to argue for a tax hike while the economy is booming. But it's another to want to hike taxes on small businesses, when 1 in 4 reports being just two months from extinction, and hike rates on the individuals still earning cash and driving our direly necessary consumer spending.

If Biden actually followed through on his promise, it would devastate just about everyone. Americans for Tax Reform crunched the numbers, and they're not pretty. For a family of four earning the nation's median income of $73,000, taxes owed would increase by $2,000. A single mother of one child making $41,000, less than 250% of the federal poverty line, would owe an extra $1,300 in taxes.

The child tax cut would be slashed in half for millions of households across the board, and millions of the country's most unprivileged would be hit with the return of the individual mandate tax. And none of that is to mention that tens of millions more of these people would lose their jobs when small businesses, on the cusp of permanent closure, are hit with the repeal of the 20% deduction for small business income.

Biden is in a bind. Does he rely on his record of the Obama administration presiding over the slowest economic recovery of all time?

Or does he commit to his promise of fulfilling his party's laundry list of spending plans by punishing hundreds of millions of people and threatening their livelihoods?

Biden can't run on his past, and now, he can't run on his promises. Stuck in a Wilmington basement with an unrelenting left still trying to tether him to its socialist fantasies, he doesn't have many other campaign strategies than to wait and ride the coronavirus wave.