We starved the beast. And suddenly we find we need it. But no amount of whipping is going to get it moving any faster than the starved, weak, abused thing we let it become.
With the Coronavirus Crisis just barely underway, I think many people are wildly over-optimistic about the US Federal and State Government response. What Governments will do quickly, how much they can do, how effective that would be if executed well, and how poor that execution will likely be.
What They Will Do Now. Dither Around As The Crisis Spirals Out of Control.
Why do I think this? Because that is what “the Government” has been doing for the past 2 months. “Reassuring the public” and “preventing panic.” Hoping that we’d somehow avoid the crisis. It is obvious the simple contingency plans aren’t in place, much less the physical preparation of beds and supplies.
We also have a very recent, utterly depressing analog. The Government response to the 2008 Financial Crisis. People are forgetting how long it took for Washington to take that seriously and mount even the half-hearted, ineffective response they produced in 2009.
There were months of dithering. We didn’t get a stimulus package until after Obama took office. That $900B popgun was pathetically too small and poorly targeted (as most serious economists now agree). The Republicans also spent the following 8 years tarring and feathering Obama for “ineffective stimulus” and “bailouts.” Making it that much harder for them to find a politically path to supporting, well, bailouts and stimulus now.
A lot of Republicans also spent the last month messaging around how the Coronavirus “scare” was a “plot to get Trump.” That was true until the middle of last week. Polling shows Republican-leaning areas still don’t grasp the gravity of the crisis. It is hard to see that whole complex turning on a dime to support the sort of intervention we need.
What They Can Do. Very Little without Congress Taking Action. And Congress Won’t Take (Quick) Action.
Most effective economic action requires spending money and/or changing laws to allow entities like the Fed to spend more money more creatively. The power of the purse lies in the hands of Congress. And that purse will stay closed for too long for the response to be effective.
Never forget that the US House (Republican controlled) voted down the TARP bailout bill on their first try in September 2008. It took a God-awful market crash (on that non-vote news) to change their minds.
Now, in 2020, we have a MORE partisan, reality-denying group of Congressmen and Senators. Why expect them to be any more amenable to acting quickly and rationally this time around.
Will It Be Effective? No. What is Needed is Direct Cash Transfers and a Debt Holiday. That Sounds Too Much Like Socialism…
Right now, it isn’t even clear we can get the Senate to vote for a watered down paid sick leave bill that doesn’t cover huge swathes of the working population much less non-working people. So what miracle is needed to get them to the sort of “make the rent” funding we are going to need by April or May?
But lets assume that miracle realization occurs. The solution is (obviously) immediate, direct, effective government intervention. Sending out checks. Unilaterally suspending contracts.
“Direct, effective government intervention” is Anathema to a Party With a Founding Myth That “Government isn’t the solution, it’s the problem.“
If there is a constant of Republican governance, it is that you can’t ever allow an efficient, effective response by government to anything. And if they come across something working well in government? Starve and beat it until its broken. Then blame “the beast” for your own vandalism.
Anything to keep people from re-acquiring faith that government might actually play a useful role in society. Even in the face of the obvious need for “governmental” functions like the goddam CDC. Too many of them are too invested in destroying and hobbling the government at all costs (“starve the beast”). Never imagining that cost might be paid by them and their loved ones.
A Starved Beast is a Weak, Incompetent Beast.
The final, sad truth is that the beast is clearly failing. As starved beasts tend to do. Too many years of below-market salaries and “running against Washington” by BOTH parties.
The government response so far has been pathetic. Shouting at the beast won’t get us much. Whipping it won’t do much either. And there’s now way we’re going to re-feed the beast fast enough for it to rise to the occasion.
So, in sum, don’t expect the starved beast to save you. And I’m not sure who else can. Which is why we are hunkered down and expecting things to get worse before they get better.
