The coronavirus crisis is already biting even though very few US locations have gone for the full bore shelter in place route. However, widespread closures of schools, the elimination of restaurant business except for takeout and delivery, the closure of bars and entertainment venues, the collapse of tourism, and recommendations to stay at home are already having big knock-on effects. A few of numerous examples: Softbank is attempting to renege on a commitment to buy $3 billion in WeWork shares. If Softbank prevails, WeWork is slotted to become the first large coronavirus-induced US business failure. Halliburton is laying off 3,500 employees as a result of the falloff in shale activity. Marriott will “furlough” tens of thousands of workers.
In New York, where restaurants are restricted to takeout and delivery, I’m told many have closed, so it’s hard for people who want to order from restaurants to know who is open and when. Here in Birmingham, where the restaurant restrictions are more severe (the restaurant has to deliver food to the car), I expect most fine dining venues will die. And Birmingham was getting a name as a foodie venue.
Now we may get lucky. The cornavirus may mutate into a milder form. Perhaps someone will come up with a drug cocktail that can be administered to reduce the severity of most cases and thus result in a much lower percentage of the afflicted needing hospital care.
But absent that, things are not looking good. The Imperial College COVID-19 Response Team report makes for grim reading. Not only does it remind us that a vaccine is at best a year to eighteen months away, but it also points out that new vaccines often don’t have great efficacy. And the Wall Street Journal reported that Singapore, Taiwan and Hong Kong, lauded for their early and effective responses to the coronavirus, are now seeing a second wave of cases. That strongly suggests that letting up much, any time soon, on serious restrictions on activity isn’t likely.
As many experts pointed out, the number of deaths resulting from an economic depression would be worse than from the coronavirus itself. Treasury Secretary Steve Mnuchin told senators that refusing to take forceful enough action could lead to 20% unemployment.
At least the Republicans act like they are willing to govern while the Democrats continue to be the party of “No, we can’t.” Ryan Cooper at The Week has a brutal takedown of the Democrats’ sorry performance. For instance:
That brings me to the economic response. So far, the House has passed a small response bill, and negotiated a second response package with the White House, including a provision for sick leave that won’t cover up to 80 percent of American workers. Speaker of the House Nancy Pelosi affirmatively defended the loopholes, saying she didn’t want to subsidize corporations. Then during a press conference Monday, Trump swung wildly to the left, saying in response to a question on sick leave that, “We want it for everybody.”
But bizarrely, during negotiations with White House staff Monday night, Pelosi agreed to weaken the bill even more. The paid leave provision now applies “only to workers caring for a child whose school or day care had been shut,” the Wall Street Journal reports. Either Trump did not understand the question he had been asked and was just running his mouth, he has no idea what his staff is doing, or he was brazenly lying — or some combination of all three.
Meanwhile on the question of broader economic stimulus, several Republicans are now outflanking Pelosi to the left. On Monday, Senator Tom Cotton (R-Ark.) rejected the Pelosi bill as insufficient, while Senator Mitt Romney (R-Utah) proposed an immediate payment of $1,000 to every adult. On Tuesday, the White House released a massive $850 billion stimulus plan (which may get even bigger), including “$500 billion in a payroll tax cut, a $50 billion bailout for airlines struggling from plummeting demand, and $250 billion for small business loans,” Reuters reports.
Even though these are big numbers, recall yesterday that Edmund Saez and Gabriel Zucman’s back of the envelope calculation was that the US GDP could suffer a 10% fall in GDP. Even Stephanie Kelton’s guesstimate that $2 trillion in stimulus was needed is light relative to that.
Moreover, more delay and more complexity leads to permanent damage. Even though the Administration claimed they’d get their $1000 checks out in two weeks, there’s no way that will happen between getting the legislation passed and the operational requirements of printing all the envelopes and checks and getting them out. In 2009, under an Obama stimulus program, the Federal government sent out 52 million checks, fewer than one expects here (presumably to ~155 million filers of Federal tax returns,1 since those are the addresses on hand; Social Security recipients are set up for electronic deposit, but they aren’t the group most in need). It took five months to distribute them, from May to October. One assumes there was also a sense of urgency then.
And what does $1,000 per adult do? The average US mortgage payment is over $1,000, so for a couple, in most cases, housing costs will eat up a lot. It doesn’t take a lot of budget estimations to show that for most this money will support critical payments like housing, car expenses, the cell phone, perhaps student debt payments, for a month. It’s a very short term stopgap.
And even more important…that amount of money is chump change compared to paying any coronavirus treatment-related bills, and all we have from the officialdom on that front so far is empty promises. Look at an indicator of the costs even for those with insurance. From The Verge:
Someone with health insurance from their employer could pay $1,300 or more out of pocket for treatment if they’re hospitalized with a severe case of COVID-19, the disease caused by the novel coronavirus, according to one analysis. Health researchers based that prediction off of the costs associated with hospitalization for pneumonia…
Rae and his co-authors analyzed a database of insurance claims for people enrolled in employer insurance plans. They found that the total cost of treatments for people on those insurance plans who were hospitalized with severe pneumonia with complications was, on average, around $20,000 — though it ranged from around $11,000 to around $24,000. Insurers covered most of that cost, but the out-of-pocket expense for most people usually reached or exceeded $1,300.
And for those who have jobs or a bit more of a cushion, a lot will be saved. It was for the most part in 2008 when the Bush Administration also launched a stimulus package that included sending checks of up to $600 to individuals, $,1200 for couples, and an additional $300 per dependent child. Even thought there was more to spend it on at that time (shops and entertainment venues were open), that was also a juncture when it looked like the economy might collapse into a depression. From The Balance:
The Bush Economic Stimulus Package didn’t have the impact it should have. A 2008 survey found that only 20% of those who received checks spent them. Another 32% put the money into savings. The rest use the checks to pay off debt.
In other words, while saving people from bankruptcy or living on the street is a worthy goal, stimulus this ain’t. It’s a band-aid over the gunshot wound of business closures, job losses and pay cuts.
And loans to small businesses? Are you kidding? What small businessman wants to take on more debt when he isn’t sure of his income or even business survival? A few who are in situations where they have genuine reasons to think the coronavirus impact on them is as blip rather than a body slam might take the plunge, but the rest? Fuggedaboudit. Plus the time and effort involved in getting together a loan application and the uncertainty as to if and when any money might be forthcoming are further stressors when someone is fighting for his commercial survival. A business owner hit by the coronavirus lockdown needs money to pay his bills now, if he still has a prospect of riding out months of the new normal, and that’s just not how these programs work.
But in the meantime, the GOP is making sure to take care of its friends on the sly:
So I hope I’m wrong in my interpretation of this, but the regulators seem to be telling banks to go ahead and dip into their capital buffers while giving them more flexibility to make shareholder payouts. https://t.co/TGFvoo9ujp via @FederalReserve
— Sheila Bair (@SheilaBair2013) March 18, 2020
So while the Republicans are thinking big by neoliberal standards, it isn’t remotely big enough. And that means Washington will be at best in catch up mode as this crisis evolves.
Update 9:30 AM EDT: More dire data, the first from Scott:
LA Times: a new poll has found that 18% of US workers have lost jobs or hours since the virus hithttps://t.co/Tp7GonwHcN
— FLATTEN THE CURVE (@TenYearNote) March 18, 2020
And:
Between Friday and the end of yesterday the State ofConnecticut received 30,000 first-time claims for unemployment or more than 10X what would normally be filed during that period
— FLATTEN THE CURVE (@TenYearNote) March 18, 2020
Reader PD says Ohio is in the same boat.
____
1 Obviously many of these are couples filing jointly, but this is to give an order of magnitude idea of the printing and mailing task.
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The FDIC issued guidance on Friday about restructuring loans that go bad do to the virus.
“A financial institution’s prudent efforts to modify the terms on existing loans for affected customers will not be subject to examiner criticism.”
No, just give it all to the rats in the Boeing, airlines, and TBTF bank C-suites for stock repurchases.
Matt Stoller has a recipe for the bailouts:
https://mattstoller.substack.com/p/how-to-structure-the-coronavirus?token=eyJ1c2VyX2lkIjo2OTcwNjcsInBvc3RfaWQiOjMxNTAzMiwiXyI6IjZRZFgyIiwiaWF0IjoxNTg0MzkxNzE1LCJleHAiOjE1ODQzOTUzMTUsImlzcyI6InB1Yi0xMTUyNCIsInN1YiI6InBvc3QtcmVhY3Rpb24ifQ.k2evWxV2k4nZzZ__H_ZuV21Jh8gNWQ_sVneyXboNEkg
It’s better than obama bailing out the banksters and big corps so they could give themselves a bonus. You dont think obama got a kickback out of it as well? If anyone is going to get money for a bailout give it to the people that made it possible to have that money, the citizens!
How is sending someone a check for $1000 different from sending someone a welfare check (ignoring the size of the welfare check)?
I not arguing one way or another on this but wouldn’t there be a lot more people hooked electronically to the banking system than a decade ago? (Yes, the people at the bottom end aren’t.) But shouldn’t it should be easier this time?
People who receive welfare usually get regular payments. The $1,000 is a one off. Even though the Administration is making noises about the possibility of more payments, they don’t have this one done yet and Lord only knows if and when any future payments will be made.
On your point regarding “hooked electronically to the banking system,” Treasury does not have the information for sending payments. The IRS issues refunds by check:
https://www.cnbc.com/2020/02/14/how-to-use-2020-income-tax-refund-check-from-irs-to-spend-and-save.html
Yves, that conflicts with this:
https://www.efile.com/efile-tax-return-direct-deposit-statistics/
Maybe CNBC was using “refund check” poetically?
I stand corrected. Note the Trump Administration in its statements also talked about sending checks.
But I anticipate that the authorization for direct bank deposits would be provided along with the tax return filing. People change banks and get new accounts as a result of divorce.
For instance, when I make my EFTPS deposit for my business taxes, the asks me for my bank routing information. I would assume the IRS would want a taxpayer to provide/reconfirm details. So this would require a recipient to contact the IRS, while sending a check, albeit slower than if a taxpayer were pro-active, would make sure all the payments went out.
@Yves Smith
March 18, 2020 at 10:14 am
——-
Tax accountant here.
Yes, when filing a tax return with a refund due, the taxpayer includes routing and account number info on the tax return. All states do the same, although there are occasional exceptions for specific circumstances. Tax preparers are required to verify account information each year in case taxpayers have changed accounts.
Perhaps the IRS could add the money to all current year refunds going out and make an additional direct deposit for those whose refunds have already been processed. That would cover a huge chunk of the population.
SSA also has the info for almost all Social Security recipients.
Acquiring direct deposit info from the rest of the people would be a massive undertaking and would still leave out the homeless and the unbanked (which is a substantial number).
IIRC, the last time rebate checks went out it was a combination of direct deposits and checks.
Thanks John
I have been receiving my IRS refund via direct deposit (EFT).
They may want the feeling of receiving a physical check so that people feel like their government is doing something concrete.
I think you are missing the point. You authorize the electronic payment when you file and provide bank details.
As I described, many people change their bank account info every year due if nothing else to marriage and divorce. I am pretty certain the IRS would need at least a fresh authorization to use a particular account
They will be getting those authorizations now through April 15 as people file their taxes. The tax payment holiday into July doesn’t preclude the filing requirement.They can issue checks to people as they get their tax returns over the next month. The timing is actually good for this, if nothing else.
It may be tough to get checks out accurately in the next 2 weeks, but the Federal government generally can’t do that anyway – I think it took 6 weeks for TARP money and that was AFTER Congress approved it. Congress isn’t even debating legislation on it yet – McConnell and Trump still need to convince Republican senators that Congress shouldn’t just go home without doing anything.
Trump said there would be millions of test kits available 2 weeks ago. They have still only delivered a tiny fraction of that. So I would take any claims of delivering checks in a few weeks with a giant tub of salt. It is amazing how bad the Dems are though, they still dither with weak responses when they could at least be seen to be acting boldly. It would cost them nothing to propose huge bold responses, even if they aren’t going to get through. They could then use that as a cudgel against Trump and the GOP senate. Instead they let Trump and others like Romney steal their thunder.
As usual, the Chinese are ahead of the game. Via Michael Pettis, its reported in SCMP that local governments are issuing coupons to people to promote spending – the coupons are time limited to encourage people to buy things right now. This is certainly one type of imaginative thinking – perhaps its a model that could be used in the Eurozone where national or regional government could partner with retailers to do this.
HK also had a HK$1000 distribution, although it proved controversial due to its definition of who qualified – apparently lots of long time residents were left out. Contrary to what was reported, it wasn’t an MMT style distribution but came from reserves.
Did it work for online shopping?
If you can find anything. Here in NYC, the main sources for, for instance, food, are out of everything. That may change in a few days but panic buying still reigns, I think. I imagine I will do some myself once I am able to. As an ancient, I am not going out to struggle with the mob at the supermarket. Maybe the National Guard will bring me K-rations.
Ah “K-rations”, as not quite an ancient ( 72 ), I would settle for C-rations ( they had cigarettes which could be traded ), we might get MRE which are the grandchildren of K-rations, unless I missed a predecessor to K-rations ( I think that was the salted meat, canned food era? ).
The Wikipedia page is instructive. There was actually quite a variety of K-rationses, plus other foods designated by other letters. Of K-rations: ‘At the sight of a box of K-rations carried by the visitors, two of Wingate’s men vomited.’ This was after eating them in the jungle for months. In theory they were supposed to be used only very temporarily. But I suppose they would be good enough prolefeed for the New Dispensation.
some stores are opening earlier 1 or 2 days a week for seniors (pregnant women and disabled) only. I think Target and Whole foods google
early shopping hours for seniors near me
Yes, the article says they can be used for online shopping, but presumably only for local vendors. But it would be a useful way of keeping shopping ‘local’.
Thank you, PK.
That idea was proposed by UK regulator Adair Turner, a Catholic and more of a Christian Democrat than a Tory, in 2008. Part of the bail out for banks would have been given to the public, time limited, restricted to certain things, e.g. domestic essentials, insulating homes, replacing old appliances and gas guzzlers, and means tested, but Gordon Brown (who saved the world according to Krugman), Alistair Darling and Ed Balls preferred to protect their City friends, including Fred Goodwin’s deputy and David Cameron’s cousin. Turner then kept his counsel as he hoped to succeed Mervyn King.
Andy Haldane also supported the idea and, at an event I attended in 2013, said how the Bank of England had tracked the “leakage” of QE overseas.
Turner supported the idea of a people’s QE and green new deal, providing some cover for John MacDonnell, but MacDonnell was a useless tactician.
There are times I wish some of the people at BoE (Haldane, and even Turner and King) were at Treasury rather than BoE
Thank you, Vlade. I agree with you.
What a missed opportunity!
The HK checks were written into their budget before the crisis as a way of responding to the protests. Now it has taken on new meaning.
The issue with the cupons is again people are still locked indoors and thus have very little spending they can do. Per Yves’ point you have to have a place to spend the money for it to be stimulus.
A lot of people are already getting a government check. Whether it be Federal State or Local workers.
A lot of people get social security and welfare checks.
The safety net needs to go to people who do not already recieve a government check.
This is not stimulus as you said no one is open.
This is to keep people from starving to death.
This is simply another form of a bribe to voters. To suggest this is to keep people alive is at best short sighted. What happens when the check is spent almost immediately? Will there be another check next month? We as a country are in deep shit. Too many people live day to day and can’t survive a long term disaster. Presently we are looking at least a month of isolation. Probably it will end up being longer. I went to two grocery stores yesterday. Many products weren’t available. How long can they keep up. What happens if many of their employees can’t work because they are sick? What happens when supplies run out and can’t be replenished? These old people that get a check aren’t as secure as you think. They will have to rely on others. In many cases pay for this help. Their expenses will also go up. Some won’t be able to find help. What happens to them/ Probably many will die. I hate to spread glommed doom but handing out $1000 isn’t much real help. What is our government doing to prepare for this emergency other that focusing on the economy?do they have agencies and people ready to hit the streets to help the needy? Like I said people are in big time trouble and the longer this persists it will only get worse.
Handing out $1000 is a start though. It’s a lot better than nothing. I won’t defend the overall response, but some income is better than the none a lot of people are looking at.
And better that it goes to many of US instead of a few big banks and corporations. I trust that decent people who do not need it will pass it on to people and organizations in our communities that do need it. It’s at least worth a try. SOMETHING has to be done.
And to answer your question, the government agencies and people ready to hit the streets to help the needy are your local county and municipal governments who in my state (Wisconsin) have been seriously downsized by the likes of Gov Scotty W. 8 years of that nonsense has left very bare bones organizations. But they are there along with all the Fed regs and State regs and more red tape than anyone should have to go through to get FOOD because they are HUNGRY.
Supermarkets are emptying. Unless they are regularly refilled, a $1000 check or a regular UBI will mean NOTHING. I worry about the food supply chain. So far the supply chain seems mostly fine… SO FAR.
Most of the shortages are the temporary result of hoarding-panic, and once you’ve filled every available storage space with TP, you tend to stop buying more of it. I expect new supply is on the way for most everything, at least of the domestically-produced variety.
I think food shortages will actually get worse. People working in stores will get sick making it difficult for stores to keep up with demand. People in the production and delivery chain will get sick. That means not as much will be produced, processed, and delivered. These two things will create long term shortages. Things that people stored up with like toilet parer will become available. It’s the supply of food that worries me most.
“The safety net needs to go to people who do not already recieve a government check.”
This is means testing. This is exactly what we don’t need. Another step before checks get sent out. Another bureaucracy to fund and populate with people who will stop people from getting money.
This is bad.
As someone else said, they can clawback any ‘extra’ payments with taxes later.
Well, yes and no. I don’t need £1,000 (or a $1,000). Neither does my mother-in-law. Nor does my auntie and uncle. Nor does the lady next door who’s got £20k burning a hole her handbag because she’s has to cancel both (yes, both) her cruises this year.
The girl who served my my coffee (take out window only now, but I’m still going to the coffee shop in an act of solidarity) looked like she might. As did the shop staff sitting in deserted stores in the small mall in my town.
So they can have $2,000 in my assessment. Certainly they should get more and the people I know who don’t need it can get nothing. Because that’s fair.
Of course what the retail staff I saw just now really need is a job guarantee. I saw plenty of old folk obviously trying to get around and get stocked up when they really looked like they’d be better off staying in. The government hiring anyone who wants to run errands for anyone who is housebound (plus managers to faff around with admin, supervisors to do criminal records checks etc.) would be a good way to start.
Unemployment payments have been liberalized, and many people will qualify for them, and employers won’t have their rates raised. Why have I heard nothing about food stamps being extended? And a rent freeze should be easier to enact that sending out checks. It’s administratively much easier for the government to make thousands of landlords whole or near-whole than millions of tenants….
“It’s administratively much easier for the government to make thousands of landlords whole”
That’s simply not true. Not even in the slightest. Pick any house in a rental neighborhood. Try to find the owner. I’ll wait…123abc LLC is not a person. Then try to find out if the owner even pays his property taxes….
But we should, in the name of some theoretical BS, send them money. Because it’s easier.
None of this challenges my point, in fact it demonstrates it very well. People, especially people who don’t need money, are very good at waxing theoretical about who is deserving and who is not. In the meantime….PEOPLE NEED MONEY!
This is performance art. The politics of personal testimony. ‘I’m very privileged, I don’t need the money but I am going to demonstrate my massive privilege by passing judgement on others in very technical terms that make me sound smart. And Reasonable. I don’t have any stake in this at all, which is why you should allow me to jump in the middle of the discussion. You should all really listen to me rather that help the people who need it. Sit down and I’ll keep talking, I’m very good at it….”
I’m awed by this screed. I used to think you were smart. Now you’re just proving you are a pompous bigot.
“what the retail staff I saw just now really need is a job”
“I saw plenty of old folk obviously trying to get around and get stocked up when they really looked like they’d be better off staying in” Proving the first part correct??
“run errands for anyone who is housebound ” If retail wasn’t bad enough…have we got a plan for you!!
“plus managers to faff around with admin, supervisors to do criminal records checks etc”
I’m going to assume you’re all criminals, and let my friends, very well qualified paper pushers, judge if you are able to continue living. Prove me wrong…GO!
100% awful.
Please tone this down. You can make your argument without getting nasty.
Clive chose to use my comment as a jumping off point to demonstrate exactly the type of means testing behavior and fact free judgement I was talking about. “yes and no” He didn’t address any of my argument. He talked right over it.
He judged everyone who works in retail as a likely criminal.
He then suggests that they should all be forced into domestic servitude because they need to get a job.
x2. When I hear people, whether Mnuchin or Dems, talk about making sure that
millionaires don’t get the payments, I want to scream.
Let’s all have to fill out an eligibility worksheet to make the Pete Buttigiegs of the world happy.
yup!
Again, just claw-back the $1K though the tax system – zero rate for AGI less the $50K with increments up to 100% for $200K and above. Still send the checks to everybody –
Why can’t this relief be funneled theough the unemployment system? Lose your job because of covid-19 and the feds cover the cost of paying you the amount over the existing state unemployment benefit up to 50% or 75% of your pre-virus take home wage. Make unemployment exempt from FIT for the duration of the emergency with the same bill.
We’re already set up to pay the recently unemployed. Why not utilize that existing system to funnel the assistance to those most immediately in need?
I’d want to make it for all unemployed (since they’re unlikely to find work soon) but i doubt you’d get the legislation past McConnel’s crew in the senate if you did.
How about a tax advataged saving account? We’ll start with a 20% EIC, then sunset in a VAT, plus a cost of living streamlining.
More complicated is bad. Why is this so hard to understand?
“Why not utilize that existing system to funnel the assistance to those most immediately in need? ”
How many people who just lost their jobs aren’t even qualified to collect unemployment, which would put them in the assistance needed most category? Do you have any experience with that?
“I’d want to make it for all unemployed (since they’re unlikely to find work soon) but i doubt you’d get the legislation past McConnel’s crew in the senate if you did.”
Oh my! You naughty boy! They might catch on and spank you! Don’t push the envelope too far, they might find out. In fact, it’s probably better if we forget you said any of this, for your benefit.
Doesn’t cover gig workers. HORRIBLE IDEA! Or people who are broke and not employed.
I’m a disabled grandmother raising my 2 15 y/o twins. We are already have a very tight limited budget, now we are having to try and keep a steady supply of sanitizerstuff such as gel, spray, wipes, a couple boxes of masks, safety glasses, and the price has went up on everything. So on the same amount this disabled grandmother was scraping by raising two kids should stretch enough to buy all the extra stuff and cover the higher prices on everything? I do understand your thinking. In theory it sounds great. In reality, people like me are going to have to choose between food, medicine, sanitizers. And on top, I have health problems and am considered high risk.
serious question, does the Federal Reserve have the authority, on its own, to issue a check to every American with a social security number using the IRS or Social Security Administration as its agent? Does it have the legal authority to act unilaterally?
It does not.
Right. As I understand it, the FED is essentially just a bank. It doesn’t have authority to write checks on its customers’ behalf. So it’s up to Treasury to write the checks, and it’s up to the FED to clear them.
Or better yet, just have the IRS deposit the money in the bank accounts of record they have
for the 138 million people who e-filed for the 2018 tax year.
They could then send checks to the remaining people who paper filed.
And those who didn’t file at all had a variety of reasons, but many of them, who need the money the most,
might be unbanked and hard to get the $$$ to.
It seems as though, once the funds have been appropriated, the `checks’ excuse is a canard.
And yes, $1000 is grossly inadequate.
They cannot send payments with bank account information that is a year stale and no authorization to make a payment that way. Enough people change banks or go from being joint filers to individual (or reverse) by divorce or marriage for that not to work.
The SSA no longer keeps addresses for people who aren’t getting SSA payments. Not making that up. When I moved to Alabama, I spent God only knows how long on hold to reach an SSA agent, to find out how to change my address. I was told they don’t keep that information on file. I said “What do your mean, you sent me a statement of what I’d paid into the Social Security every year and what I could expect in benefits.” The agent said, “We quit sending those statements years ago.”
The agent you talked to could be misinformed. My wife and I have been receiving annual SSA statements — including in 2019, which is not “years ago.”
Maybe the agent was just talking about Alabama – after all they are only nominally part of the country….and this might help explain some of their poverty figures.
We still get our statements every year as well.
Are you currently getting SSA payments? The agent was adamant that they no longer have the address fields in their system for people not getting payments. I went in circles with her for quite a while because I found the answer to be implausible.
We did not get as far as my being in Alabama. I called from a 212 number so she would assume I was in New York if she had caller ID. And if you go to the SSA site, you don’t get any responses when you search on changing your address. You would assume there would be a form you could mail in or fill out online.
If you look at the site, it says (emphasis mine):
https://www.ssa.gov/myaccount/change-of-address.html
I got a statement in 2019 and 2018. But earlier (2014-2017) had not.
My wife and I receive Social Security retirement benefits and get statements in the mail every year, too (I presume both politicos and politicians want to make sure their largess is at least noticed, if not appreciated). We also get a forms SSA-1099 along with our other 1099s. Moreover, as foreign residents, we get near-annual mailings that require return confirmation of address and status on pain of cessation of benefits — I’d guess to flush out expatriate recipients who are deceased as much as anything else.
So SSA maintains addresses at least of beneficiaries, if not contributors.
Ditto here, I have received one every year.
It’s been a few years since I received a statement. I had noticed they’d stopped.
Me too.
Got one just 2 weeks ago, in AL.
As I said, are you currently getting SS or Medicare payments?
I am not yet signed up for SS, but do receive an annual statement, and have for the past several years.
I have been a W-2 wage earner, and am now a dumb-bunny sole proprietr, not a C or S corp.
I contribute a healthy amount to SS every year.
As I said, dumb-bunny.
She did not sound dumb. I went several rounds with her.
It also says on the site, which is a partial confirmation:
https://faq.ssa.gov/en-us/Topic/article/KA-01711
I asked if you are on Medicare as well…yes or no?
Did you sign up for an electronic account?
I have not received a statement for years. And before I moved out of NYC, I had been at the same address since 1992.
Both my wife and I have recently received SSA statements by mail – neither are on medicare nor SSA benefits. ALso if you register online with the SSA you can get the same info that is mailed out.
One problem with online dealings with the SSA, as I found out, is that they use the database of one of the big credit rating agencies to identify you. So, if, as happened to me, your credit is locked up for any reason, the SSA will not give you any information online. I had to go to the local SSI office in person to resolve a matter.
Public/private partnerships are just another layer on the Gatekeeper Onion.
@Yves Smith
March 18, 2020 at 10:53 am
——-
It’s possible that SSA is using addresses submitted on W-2’s, since they are filed directly with SSA, not the IRS. If you haven’t had a W-2 submitted in your name in several years that might explain why you’re not receiving statements.
Sole proprietors paying self-employment taxes would not be in that database since their filings go through the IRS first.
I do issue myself a W-2, so that isn’t the case here.
https://www.ssa.gov/myaccount/statement.html
‘We currently mail Social Security Statements (Statements) to workers age 60 and over who aren’t receiving Social Security benefits and do not yet have a my Social Security account.”
Well I am not getting them but that gives me a basis for calling the SSA again. Thanks for that.
Yves this may be the year where the government does know everyone’s address. Yesterday I filled out the census form on my PC. The census requires you verify your correct address. Compliance is mandatory. I know the census information is confidential but they could make an exception to get proper address information from the census to mail out the checks.
‘Compliance is manditory’
Oh, right ! .. Well good luck with that strategy. Aside from the hackable aspects of online Anything !! … assuming the feds just don’t turn over any census data to thirds parties for profit/churn harvesting, trying to compliance during a Global Pandemic will, I think, be rather daunting.
I’m completely distrustful of how our governments operate, ESPECIALLY within the Federal realm !
So, for me, complience gets either the shreader, or the DELETE button !
As an aside, the human who queried moi back in 2010 .. had the off-putting terse demeanor, as well as the semblance .. of a dour Liz Warren ! It wasn’t what I recall as a warm & fuzzy experiance.
> . . . a $50 billion bailout for airlines struggling from plummeting demand,
They are the super spreaders, but proclaim innocence and want a handout. Let them die.
Still flying = Total Fail
super spreaders, super polluters, super oligarchs, super useless now
People should be grateful that Joe Biden is running for President. Otherwise, if he had time on his hands he would have put together and had passed a bill that said that if a student receives that $1,000 that they must use it to pay off some of the interest on their student loan first before anything else.
The World Economic Forum just ran a pandemic simulation program in Oct 2019 so why is the US acting so unprepared??
The danger of turning the public sector into a financial monopoly means there will always be a need for more wars, more prisoners, more sick people, more revolving private debt, more disaster capitalism.
Zbigniew Brzezinski of the Trilateral Commission. Yes, that’s Mika’s (Morning Joe) father, who wrote in his book, Between Two Ages, in 1970:
So, we can all finally agree that Zbigniew and the rest of the neoliberals were flat out wrong.
“You talk of nationalizing the Fed. I know people don’t like the word nationalizing. How about thing de-privatizing or de-Thatcherizing the Fed? You have to represent the Fed as having stolen economic and financial policy away from the public domain. It became part of the neoliberal project taking form in Austria in the 1930s. You’re trying to restore the classical economic vision of productive versus unproductive credit, productive versus unproductive labor, and public money as opposed to private money. These distinctions were erased by the censorial neoliberal counter-revolution.
It’s not that you’re radical, that these people had a radical revolution to carve away the financial system from democracy. And you’re restoring the classical vision of democratizing, re-democratizing finance and banking.“
Maybe they did a simulation but the last time the World Economic Forum had “Pandemic” risk as a top 5 risk was 2009. And that was for consequence only, not likelihood. You can be sure it will be at the top next year. Recency bias. After a couple of years, it will disappear again as a risk of note. “What me worry” bias.
Using the word stimulus is the first mistake. The economy will be frozen in place by this. Stimulating it is not possible. It needs a rescue, and by “it” I mean all individuals and all businesses. This should be a survival package, not a stimulus.
Agreed. You can only stimulate something that is still moving.
Tis often said a crisis shows the true person, and in pelosi’s case, we see her[1] corporatist ownership in spades. She was outflanked by Cotton and Romney? She should quit, go into seclusion, and spend her remaining days on earth asking G-D for forgiveness for selling out.
[1] To be fair, the entire corporatist wing of the “democratic” party, the dnc, etc.
The Dem bird would have about a dozen feathers remaining once you pluck the corpratist feathers.
I’m not saying it would be easy but it should be much easier than people think to get money to every individual. We have scores of layers of public and private surveillance, recognition, identification, tracking in this country.
Yes send 2,000 now, and I do mean now, and more in two weeks. dawg forbid, if some actually save well then raise banks reserve requirements accordingly or some such. Get these wheels greased, people fed, maintained utilities and what not. Nationalize everything, at least for a time. Tell every med biz, utility, oil, grocer, pharma,
userer (anyone like CC companies crushed down to no more than what 3 to 5% above current fed rate?)… to sell at cost plus (whatever is below wholesale) or they will be taken over. Buy out all student and med debt at pennies on the dollar.
Maybe the fed Gov should just buy all private utility bills at below cost for a while.
Establish jobs programs which establish M4A, lots of home care, including food delivery and basic cleaning for those who are sick.
Laying fiber internet to every home.
Be the shock doctors this time rather than letting the old ones have it their way again.
They are quibbling over 1000 or 2000 for this first check? Amazing. Everyone needs money for food until we can do food stamps for all; nobody has the cash for an emergency like a furnace going out, a bad tooth or or a flat tire. Send 2000 now and 1000/month until the government can nationalize everything and establish distribution, rationing, essential production, and jobs. Establish M4A without further dithering – even if we didn’t have this crisis M4A should be the law of the land. Forgive all the debt that has burdened this society, every last penny. One way is to follow Richard Murphy’s suggestion to either forgive or postpone all private debt: business and mortgage loans; rents to landlords. Put it on ice until we figure out how to make the economy equitable and functional. Helping SMEs that can stay operational is not a bad idea – they need to buy from wholesalers and pay their utility bills too. No frivolous manufacturing, no price gouging, no hoarding, no windfall profits… etc. If we (congress) keeps nit picking about this we won’t recover for years to come. Those twits.
No longer religious but I do like the Old Testament concept of the “Year of Jubilee”
Call it a reset, and start over when the dust settles. Works for me.
Jubilee was exactly my thought. You said it first.
I’m not sure I consider the $1000 to be an outflanking manoever. The fact is that the corporatists all know that Sanders is right and this is the best argument for M4A and other support programs. The $1,000 and the weak-tea leave policies are an attempt to blunt anger for that without doing what really needs to be done. In that respect Pelosi and Romney are on the same side.
Also, I think the $1000 check is to blunt criticism about bigger bailouts to come for the big corporations and banks. Instead of a populist resentment “Don’t bail out Goldman Sachs! Again!” our leaders will say, “Hey, you got your $1000 check, so shut up.”
Exactly! The powers-that-be have done this several times in the past 40 years. Just bribe people with a paltry handout to make them swallow the massive welfare transfer to the rich.
Sick!
Is it time for Donald Trump to mint the coin?
Pelosi and the Dem elites are acting with all the compassion and good sense I have come to expect from them.
Bless their hearts.
Tom, how are you doing with your chemo under the current everything-just-changed times? I miss your NorCal RE-market commentary over on Wolf Street. Anyway, sending some hopes-for-the-best your way.
My wife and I are very fortunate. We don’t need the money.
If we get a check in the mail, we’ll donate the funds to a local food pantry.
If you can, pass it on.
I’m in Italy get their dole mistakingly tagged UBI, half goes to late utility bills, other half goes to German discount supermarket Lidl, and this is a monthly stipend at least not a one shot. Not much stimulus there. Apart all the covid shutdown issues not too sure how to do bottom up stimulus in a franchised corporate local economy, plenty of towns in USA are nothing but mall and strip mall franchises, money extracting operations. So the Panera Bread in town hires an extra minimum wage worker, there’s your stimulus.
Dylan Ratigan IIRC on Jimmy Dore was saying that for shops and small businesses this isn’t about loosing 20, 30, or 50 percent. It’s about going from 100 to zero.
Amazon is open, anyone that is blessed to use the $1000 as disposable income will spend it there. Bezos will be stimulated.
This could be a “mis-rememberance” but, didn’t the last time a stimulus during Bush admin in 2008 happen ($200-300) we saw a big jump in online porn and gambling? Of course with major sports shutting down the betting world will have to come up with new angle. Maybe this time around it will get allocated differently ( i.e. the Tip Jar @ NC)
:)
I don’t recall that but its worth noting that my recollection is that when Bush did it, they subsequently took the money back in the form of a one time tax increase after the next election.
They can bet on Roomba curling this time.
https://twitter.com/martoo14/status/1238859529393070081?s=20
I suspect the GOP’s newfound religion on using fiscal policy to prime the economy has more to do with Trump’s re-election than any sudden conversion from neo-liberal orthodoxy.
Still it is a bit refreshing and if nothing else, it will help regular folks a bit, and maybe suck some oxygen out of the room as far as bailing out the banks or other too-big-to-fail entities (see my comments below.) I agree it won’t make any kind of real difference as the money will mostly end up in the bank or paying down debt. Nobody is going to use it to book a cruise or go to a concert. At least not right now.
Something to keep an eye out for is the situation with Boeing. Yesterday there were stories that their lobbyists are already begging for a $60M bailout of some kind. Reportedly a loan facility to keep them on life support while they wait for the miraculous recovery of the airline industry in 2021.
Yet Boeing management continue their shameless arrogance in not cutting the dividend or doing a capital raise (selling shares) before seeking taxpayer intervention. This must not be allowed to happen. BA management looted the company a la Enron with stock buybacks, pumping the stock to ridiculous levels so their executives could cash out.
Boeing’s latest tactic seems to be extortion – give us a bailout or the supply chain gets it.
Please write/call Congress to tell them no bailout for BA shareholders.
Skilling, Fastow and Lay never killed anybody, either.
Boeing want’s a 60 BILLION $ bailout to continue its mismanagement and corporate graft not mere millions. But some of those funds would be cycled through congressional payola, so some trickle down.
Warren has pretty sensible conditions for a bailout of any major corporation
https://markets.businessinsider.com/news/stocks/warren-laid-out-conditions-companies-accept-bailouts-coronavirus-crisis-2020-3-1029006340?op=1
I don’t see among her conditions that the bailouts are to be repaid to the taxpayer in full. I.e. the aid is in the form of loans, not grants, and are senior to all other debt. Her first condition–that the funds be used to keep employees working–may imply that the funds can’t be used to pay off other debts, e.g. to bail out their banks; but that should be made explicit.
Trump’s re-election? Absolutely.
I’m reminded of things Nixon did in the second half of his first term. Greenlighting the establishment of the EPA and OSHA. Going to China.
Any day now, I expect Trump to nationalize the health care system and declare Medicare for All as our default insurance system. I’m also betting on a debt jubilee.
Trump is rather free from any kind of political ideology or orthodoxy so I also wouldn’t be surprised to see such kinds of “fluid” responses.
Maybe he could abolish all the illegal sanctions on all the countries he has imposed them on. Peace on earth-abolish NATO!!
Any comments on Sanders’s plan? He’s proposing $2k a month for the duration of the crisis. $2T in bailouts for workers.
The witchdoctors of neoliberalism in USA and EU must be having a conniption fit right now, 40 years of best laid plans… Once they go short term New Deal they are going to have a hell of a time unwinding it, and I don’t at all mean the freebie money, the country will certainly not become overnight welfare queens, I mean the actualized idea that a strong social architecture with health, wage and work protections makes for a much less precarious much more robust and safe society. Will they be able to put the toothpaste back into the tube? You know they are thinking it. Lagarde sure was. Thank God there’s been Bernie for the last six years acting like John the Baptist, preparing the way.
Where is Biden on this issue? On don’t see any of his coronavirus stimulus plans mentioned in the media. He seems to be missing in action?
Biden exists as a figure out of pop culture when he is largely a Trumpian figure among centrist nihilists in reality. Biden served as a faux union friendly face for the credit card industry and not much else during his fifty years.
Actually, he could easily be better than Obama as he won’t have the energy to silence congressional voices or cover for the ilk of Schumer and Pelosi.
https://berniesanders.com/issues/emergency-response-coronavirus-pandemic/
Apologies for incorrectly posting a Sanders link to your Biden question. As far as I’ve seen Biden’s only issued some platitudes.
Biden is napping and receiving a complete blood replacement.
Has anyone else noticed the correlations between Joe Biden and Mr Burns from “The Simpsons?”
“Release the hounds!”
It would be nice to hear Bernie go after Biden with a full court press and say “well Joe, I just released my plan, where is yours?” I mean full court, as though he’s still running for President. You know, primaries? Oh I forgot, Joe is his friend.
As I have been saying, one of the worst side effects of COVID19 is that it causes Socialism.
But Democratic voters are not embracing the only socialist candidate.
Socialists for Biden? WTF? Biden will never enact Bernie’s policies. He’ll pretend to but not once he’s elected. Just like his former boss, Obama.
https://billmoyers.com/story/socialists-for-biden/
I think he’s actually referring to Trump, not Biden.
Yeah, pity the poor establishment. Socialism will be devastating to them.
sainthood for sure,
“the actualized idea that a strong social architecture….makes for a….much more robust and safe society.”
If it’s good enough for Wall Street, it’s good enough for Main Street.
I know someone who sells food to restaurants for a sysco competitor in upstate ny.
Business is off 50%. Most are just going to close their doors after trying take out, which few think will make money.
They also cannot get any hand sanitizer. Anything like that is on back order.
If the restaurant serves alcohol, I can almost guarantee that take out won’t do it. Bar sales are almost singlehandedly the driver of profit.
And that is before a huge chunk of the population that used to have enough to go out to eat occasionally realize it is oatmeal and ramen and even that is limited because they have no money.
more color from today-
Half closed their doors already. The other half are trying take out. Most of that other half are ordering half of what they used to this week.
Business off 75%.
They all need to address the virus first. We need aggressive testing and isolation now and continuing permanently. There is no economy if people are locked in their homes. They have to make it safe to go out.
If this continues it is the end of civilization. The civil authority is in serious danger of implosion as is the economy.
They can’t make it safe to go out. We don’t have the capacity to do contact tracing. People are contagious BEFORE they show symptoms, days before. So by the time they are known to be sick, they’ve already likely infected others. Containment greatly reduces how many people get infected.
Charitably assuming that getting infected confers immunity (the assumption on which the hope of getting a vaccine is based). the disease won’t stop spreading until one of the following happens:
Other possible positive developments that would allow for letting up on containment:
re: contact tracing.
Since our electronic-voice, texting, financial and GPS footprints are out there, how about the NSA’s vaunted capabilities or Palantir’s distasteful use of data-mining.
Perhaps a large proportion was smoke and mirrors ? My bet is that they don’t want to reveal their capabilities, partly because it will expose past illegalities and /or alert the populace as to how much they DO know about you – in near real time. Even at the cost of helping to contain the spread.
I’ve done social-network analysis so I’m alert to the possibilities given the data. It amused me to see self-identified government security blokes at two conferences giving talks on terrorism networks. That’s when other talks were on drug-user network, insurance fraud networks etc. In one ironic case I watched a security fellow helping out a Lebanese academic on their questions.
Of course I don’t know for sure one way or the other. And no doubt someone who does won’t tell. Unless they are saints like Snowden.
so, in other words, there’s an app for that?
It’s hard, detail oriented work. It cannot to automated. Not that *someone* won’t try to sell that idea. It’s worth a lot more as an idea than as anything that will help anyone.
We need to focus “like a laser” on getting testing and isolation up and going, and firing on all cylinders. I know I am engaging in wishful thinking, given our decadent and ill-intentioned leadership. But unless this happens, I think we implode.
Otherwise, by the time we run through the infection and immunity cycle, our economic structures that keep people fed and housed will have crumbled. You can’t run a society on lockdown. I suppose with teams of people working on logistics, it’s possible. I don’t see any of that happening. Sending people checks isn’t the same thing.
Given our trajectory, I’m looking at troops in the streets in four weeks. In six months or a year, we will be looking at a radically transformed world. Maybe not even that long. And likely not for the better.
I think reasonably effective contact tracing would be possible with a concerted federal, state, and local effort. Again, I know. This is America we’re talking about. Dream on.
I can’t recall who, but someone in authority said the US won’t spend the energy to do that. It’s pretty manual. China reportedly had 1800 teams of 5 each on the task. I suspect organizing the task is as big an issues as execution.
This virus is the ultimate ageists. I know there are stories of young people dying too, but the data shows numbers that are still very, very low, enough to be associated with at risk issues such as smoking or athsma.
If you ask anybody if it’s worth risking a worldwide depression, martial law, etc to save 30% of the 70% of people over 60 who would get the virus, they’d say the old need to bear the brunt of this. Most seniors understand the relative value of life being at least partially a function of years remaining.
I’m just advocating we must relax the restrictions on the low mortality risk young and healthy for the good of society.
The old and infirm should be isolated from the young and healthy (who may still have the virus) and be supported with significant social mobilization efforts (services to their door without contact).
I’m already debating in my head how long it will take before deaths of despair to the young overcome the mortality of seniors from the virus if we do not alter our current course.
It won’t be safe to go out until enough people have herd immunity; having recovered and are no longer shedding viruses. This is letting the virus burn out naturally which will overflow hospital systems. All nations that are not doing universal lab virus testing, contact tracing and quarantining infected spreaders are forcing their citizens to play Russian Roulette when breaking shelter in place to get food and other essentials of life. A voluntary quarantine won’t work. One super virus spreader out and about like the NY lawyer and there will be new hot spots breaking out. The second problem is time. Food logistics and home delivery must be supplemented with government intervention. Amazon and Albertsons can’t feed everyone. With businesses failing and no income, there will be starvation in the hot spots before the November election.
The Western Empire and the EU are finished. The question is will Donald J Trump do what is necessary for the federal government to prevent chaos across America and win re-election. The establishment may well be keeping him in the dark; which so far appears not to be too difficult.
If you’r purposely closing the economy, how can people talk about stimulus? That makes zero sense, close the markets, debt and payment forbearance, and then everyone can talk about how this isn’t a great way to be fighting a virus
Saez and Zucman opinion piece in the Guardian today on government as payor of last resort. Probably makes too much sense for TPTB.
https://www.theguardian.com/commentisfree/2020/mar/17/governments-crisis-coronavirus-business
We ran their article on their proposal two days ago. It first appeared at Dollars & Sense:
https://www.nakedcapitalism.com/2020/03/social-insurance-in-a-time-of-pandemic-a-proposal-for-the-government-to-act-as-buyer-of-last-resort.html
Sorry for the repost. My memory functioning is a bit addled by all this.
Their idea of the gov. being buyer of last resort to keep things on life support is good because we have that infrastructure to use – before it goes dormant and/or becomes irrelevant. But it is too much like keeping a dead body alive to practice for very long. Just long enough (imo) to set up adequate nationalization of the economy. It looks like stages from emergency to stabilization to good health, just like an epidemic, ironically. And just thinking about the SSA and the IRS – we have two institutions that can be renovated to serve the nation. We do have some good social infrastructure – we just haven’t used it yet as an intermediate step to an equitable society. That’s almost a reassuring thought.
Keep your $1,000 and send me a kit or two – we’ll call it even.
They should give every household a month of food once a month, or perhaps once every two weeks if the food is perishable. The 1000 dollars will be useless if only the grocery store is open but the grocery store is not fully supplied.
After Blowing $4.5 Trillion on Share Buybacks, Airlines, Boeing, Many Other Culprits Want Taxpayer & Fed Bailouts of their Shareholders
The people will sink and the shareholders will take a mega yacht.
Thanks for adding that key fact. I kept the post short so I could turn in. Bloomberg reported that the airlines had spent 96% of their free cash flow on buybacks in the last decade.
They probably levered up as well. We shouldn’t bailout the lenders who encouraged this stupidity with lavish credit lines. Nor the Boards of Directors who approved this practice for a measly tax shield.
Only a $1000.00? IIRC George W sent everybody $800 almost 20 years ago so not much of a cost of living increase here. That won’t even cover a month’s rent anymore.
I will never forget the checks W sent out because I was working at WAMU at the time and an older black guy who was one of my favorite customers came in to deposit his check and sardonically quipped as he handed it to me, “Thank God for our Great White Father”. Ha!
Ya it was a refund of SSA contributions. The stupidest most short-sighted move all to show that everyone got a “tax break”.
It was $400, for a single filer, I recall. $800 may have been for married filing jointly.
The amount might be the same for all but the value of a receipt of such funds will vary a lot:
The super wealthy won’t notice it.
The wealthy might not notice it.
The average person might only find it to be a small help
The poor person might find it very helpful
Helping the worst off might not considered to be reason enough to do it but maybe it could be reason enough?
Not that this is insurmountable, but I’m a renter and I’ve moved every year, and not just to new apartments but to different states. There’s been talks of delaying tax returns, but if I don’t file my returns then how will they have my new address?
I really appreciate your insight into the logistical difficulties of “just sending checks.” This is something I hadn’t really thought about until you mentioned it. I wasn’t really paying attention at the time but I didn’t realize there was such a delay in getting those stimulus payments out.
Without a some kind of support for renters I may as well just give them my landlord’s bank information, that is if I end up getting a check at all.
I would think right now that one solution would be to not pay rent. Many states are starting to talk about stopping evictions, and your landlord isn’t going to find another tenant in the middle of this crisis.
Property owners [and the banks that loaned them the money] can afford the hit more than tenants can.
You’re right that they couldn’t find tenants, but most of the moratoriums are just on actual eviction proceedings and serving of evictions by police. In at least some states that have already halted eviction proceedings landlords can still file the necessary paperwork even if the actual eviction can’t start yet, and many are probably trying to evict people who they wanted out before the economic fallout gets much worse. In at least some states tenants don’t even have to be given any notice before eviction proceedings start.
Evictions have not been halted because of economic hardship on renters (yet) but on public health grounds, which doesn’t really address people losing hours/their jobs over this.
Looks like Trump just announced a halt on evictions through the end of April.
And then by May ?? What then ? Embrace the suck & regain the churn ?
I see riot people …
The Georgia courts were effectively put on hold for sixty days for the majority of cases on March 14th – they’ll hear emergency only hearings (think commitment for mental issues), setting bonds, and an emergency appeal for a death penalty only (with some exceptions). I spoke with a clerk in Athens, Georgia’s Magistrate court (which handles dispossessory actions) and she stated that the Court had ceased all hearings on said actions, which would effectively delay any eviction.
There is nothing to stop a party from filing a dispossessory (or other Complaint) between now and May 13th but the Court has tolled all responses until that time. Thus, there will be no new evictions between now and then (or garnishments or perhaps even divorce temp custody hearings and child support orders).
Thank you for this information. I am not a lawyer so I wasn’t sure what it meant if things could still be filed even if there is no response. No matter what I suspect some landlords will still hound their newly un- or under-employed tenants even if they can’t legally evict them. Interesting times.
These are revolutionary times. The old neoliberal globalization order is crumbling. Trump is finally waking up and realizing he can totally take advantage of this pandemic situation! He can start throwing money around like a drunken sailor, which is actually what he should be doing to avoid an economic disaster. At first the Republicans downplayed the virus in a desperate attempt to save the economy while the Democrats exaggerated the virus in order to create a recession to help them win the election. The Democrats won that battle because the virus is even worse than they imagined. But while the Dems were celebrating and starting to plan Biden’s coronation, the Republicans quickly tacked to saving the economy (buying the election) through helicopter money and UBI. Can MMT be far behind? These 1000 Trumpbux will most likely turn into a monthly payment (through November at least). Remember that Chinese/corona virus cases are starting to increase again in China and Korea.
The homeless are starting to be housed; the horrendous living conditions of illegal immigrant agricultural labor is being questioned. Health care in the US is about to become de facto universal. Pollution is way down, the climate is happy. There is a major hate campaign getting under way against the PRC which will be even larger in scale than the Dem’s hate campaign against Russia. The society that eventually emerges from this lockdown will be very different than the one that entered it.
You point out the insanity of the “everyone lives forever crowd”.
I will assure the “make everyone stay at home to save the last one” crowd , that long before the virus is contained, you will have mass open rebellions as people are not going to accept months and months of forced quarantine.
To crash the world to stop this thing is insanity.
One can take reasoned and rational risks(you do it every day).
The idea that a 15day lockdown as is being done in Puerto Rico is going to stop this thing is just math insane thinking.
It can’t work and will weaken systems that are left to deal with the smoothed curve.
The problem with your alternate scenario is that not flattening the disease curve overloads hospitals and kills doctors and nurses. In Italy, every MD in a hospital regardless of their specialty was tasked to coronavirus treatment. How do we have a medical system if we lose a marked % of the doctors and nurses in our hospitals? They will insist on the quarantines as a condition of their continued service.
The likelihood is the US tries relaxing restrictions, the disease flares up after a short while and they clamp down again.
However, jobless claims will be published tomorrow. By the following week, they will explode. That may force a rethink but tons of restaurants will be dead by then, and Lord knows what else.
I wonder when age will come in to play with all this. Older people are more at risk and thus I imagine more likely to support shutting it all down to fight the spread. Younger people have a much better chance of surviving. If the choice is between economic depression a lot of younger people may start to have the attitude that going out in to the world is a risk they’re willing to take.
The statistics (IIRC) from China showed that 54% of Corona deaths were over 60, and the over-60 population in China was 20% of the total population – so there is indeed greater danger to older adults – but that doesn’t discount the other 46% of deaths which occurred in middle-aged victims. So that’s still a very serious epidemic and one that strikes the very people who must “go out into the world” to their jobs to make the economy function. If they all die off it’s a much worse disaster that us old farts kicking the bucket. So they need to practice quarantine as seriously as grandma. Additionally, even though over 60s are vulnerable, they don’t get out that much so they are not spreaders – which means the benefits of quarantine are created by the middle-aged cohort curbing their activities. I would think.
just double checked the Chinese stats on worldometer.com and they are claiming that 80% of deaths are over 60. Still the point holds that that age bracket does not go out as much as the 30-50 bracket and so the younger bracket is the biggest spreader, even if only suffering 20% of the deaths. That’s still plenty of deaths to the working population. As well as maxing out the hospital beds for the hapless seniors. Sort of the same difference here.
>>you will have mass open rebellions as people are not going to accept months and months of forced quarantine
Ha! The vast majority of First Worlders have been cocooning for years already. Until all this, I went out a lot and always saw very, very few people at the vast majority of museums, libraries, state parks, historical sites, and anything that wasn’t a shopping mall or restaurant (and even those have seen visitorship collapse). Hiking in a (non-touristy) state forest on a beautiful Saturday afternoon I might pass ten people on the main trail over a few hours–in the middle of an urban area with hundreds of thousands of people.
Most people will barely notice being stuck inside. Their concerns are for whether they can see their families and friends and their economic survival. But you can play Fortnite, go shopping and get delivery in a quarantine no problem as long as the money is coming in from somewhere.
The challenge is creating an economy that works under lockdown, and ramping up testing so we can know which friends and relatives it is safe to visit.
The French Method might prevail. No visiting anybody for any reason.
We have a draconian complete lockdown in France. Nobody is allowed to deviate from the strict rules for shopping and even walking for exercise close to each home (one person alone!) 67 million people(normally not obedient) and 100 000 police all around the country. Each trip you must have an “attestation” signed and dated with the reason for your outing (I was warned the first day-now it is 175 euro fine) and schools, creches, all other public venues closed BUT no shortage of food etc and of course petrol is now cheaper , when of course we cannot drive far (over 20km for shopping is forbidden).
Land of human rights!! I hope it does work -two weeks is the minimum duration forecast.
Hudson: “The brain of the host is tricked into thinking that the parasite is a part of its body, to be protected. Economics is not about reality. It’s about the internal consistency of assumptions. It’s to build a beautiful system that, if it really worked, would be so appealing that students will be willing to suspend disbelief. That is what a good science fiction writer would do. The trick is to make readers willing to accept the assumptions that they’re given at the outset…”
The civil mythology is in serious danger of implosion…
Sounds like Scientology. Actually, that explains a lot!
I had my first covid-related ugly cry for 30 mins last night. During this episode, my cat was curious about me, but wouldn’t let me near her.
1. $1000 times two adults in a household is better than $1000 for us who live alone.
2. If my job goes out of business, who handles the COBRA administration? I could go without insurance to save money, but maybe not the best time to do that.
3. Is the $1000 subject to taxes, Medicare, fica?
nakedcapitalism is so valuable to me right now for its guidance, though I don’t know if it’s in its wheelhouse to become a information hub for how to survive this financially.
I’m so sorry. So many people are hit very very hard by this. We’ll watch for articles on financial survival.
Thanks
I have since found out that there is no COBRA opportunity if a company fully goes out of business. If one gets laid off from a company that’s still alive, the COBRA can be arranged.
My congress critter posted a letter today asking some banks nicely if they’d hold off on foreclosures. I’m sure they’ll put us before their shareholders. /s
https://twitter.com/janschakowsky/status/1240373637494030336
One other impact: no sales, no sales tax, no income, no income tax. How will state governments continue to function?
“Low interest loans!” -Chuck Schumer
These people have no clue about the storm that’s coming.
“I don’t know which is worse, Bourke .. you don’t see them screwing each-other over for a percentage…”
Chuckles as the Weylan/Yutani Company man.
And another: many state unemployment insurance funds had to be bailed out by the Feds back in 2009. Are the Feds ready to step in again?
It seems to me the banks do NOT want to have to take on and own/ manage businesses and homes that may be lost through the potential hardship we are all facing. Jingle-Mail writ large.
Here’s a part of what I sent in haste to my Senator yesterday in a fit of apoplexy:
Old data— 2010 Bureau Labor Stats showed workforce of 140 Million, 7% of that self-employed.
9.8 million souls. Not specifically included in the sound-bites as part of that working class who will need relief. Obliquely, implies tavern and restaurants. But not hoteliers, farmers, yada yada.
2017 Gallup poll shows only 47% of folks have stocks, bonds, 401Ks, IRA’s.
53% do not. The Dow is NOT the economy. Main Street is.
2018 research shows median investment account balance for those that have such accounts to be $11,700.
2019 CNBC showed 70% of Americans have less than $1,000 in savings / investment account balances.
Romney/ Trump/ Mnuchin $1K -$1.5K one-time cash to Americans is an insult. It speaks to the disconnect between beltway insiders, the media, and their relatively cushy annual salaries and benefit packages, their Dow-powered savings, from the Average Joe. What would $1,000 dollars do, truly, for any American over the next 9-12 months of deep hardship? It is frankly a cruel, insulting joke.
I work with and come from a family of Lawyers— the cynic in me says it is almost a buy-off settlement by the government. “Consideration”. A Settlement. Almost takes me back to Treaty/Tribal settlements.
A large rollout of bailout to banks, business, and industry is fraught with moral hazard- pick a favorite?
IF we must do this, there had better be strings attached that inure to those industries end-client consumers. For example–Airlines— they (or their successors in bancruptcy and / or reorganization) had better extend credits to displaced travelers for several years—my $20/hr Montana son cancelled a two year planned/ saved trip to Bali and has to use his re-booked ticket by October 2020… we may still be up to our withers in Covid.
That is not right— we know airlines are hurting, but so are their clients. 9 months use-it-or-lose-it is not right or fair.
Another large rollout to Wall Street, like in 2008, combined with fractional reserve banking and the clever management by Wall Street lawyers and Bankers will simply fuel their habits. I envision vultures, with re-loaded liquidity, ready to pounce on pennies on the dollar assets, real-estate , and business that are in peril now. More wealth accrual to the very wealthiest. Aided and abetted by Congress, ironically paid for by the taxpayers that are going to lose their all to the vulture-Davosman class. That ain’t right, either!
May all here- and everywhere, have robust good health and good fortune, somehow, through all of this.
Namaste— I bow to the divinity in you!
US- Canada border just closed to personal traffic.
The cure is going to be worse than the disease.
If the “disease” you refer to is Capitalism, then that is a dire prospect indeed.
for discussion, there are only four outcomes in the next 12-18 months:
1) contract the illness and die
2) contract the illness, get better, body develops natural immunity (maybe?)
3) there is the emergence of a medicine to help the body in 2), above.
4) do not contract the illness — not necessarily a choice for any given individual
all the social behaviors that are asymptotic to “shelter-in-place” are delaying 1) and 2) so that the health care infrastructure is not destroyed by the waves of very sick people coming for care
And justified or not, the “shelter-in-place” behaviours are destroying the economy. Not right or wrong, just true. But unlike ’08, the banks are good.
THIS IS IMPORTANT. I read NC all the time but rarely post. Please read the “Imperial College COVID-19 Response Team report” which has set off all these closures. Here are the problems with the self-styled “report”
1) According to news sources the draft had been circulating to policy makers for more than a week before the text was released and acted on. The authors never posted the report on the two websites where most Corona documents are posted so professionals haad no chance to give critiques and responses. Even more suspicious is the authors say they have decided NOT to submit the report to any of the peer reviewed journals, many of which(eg the New England Journal of Medicine) will post reports and get real professional responding within hours. The report was circulated to policy makers but the professionals who might have picked it apart were kept in the dark and denied access.
2) The moment you start reading it the underlying assumptions fall apart. The death rate for example assumes that NO NEW ICU WARDS will be created in the next 24 months. Worse, it dismisses the successful “trace each case” systems that have worked so well in China and Korea as being “unworkable” and could lead to a million deaths. PLEASE, IF YOU ARE A MEDICAL OR EPIDEMIOLOGICAL PROFESSIONAL, READ THE REPORT AND SEND YOUR COMMENTS TO YVES SMITH SO SHE CAN PUBLISH THEM IN ONE PLACE. If, as I suspect, the report is either inadvertent bad science or poor modeling- or worse intentionally a setup designed to stampede the policy makers into making an ill-informed policy decision, only a proper airing and real peer reviews by professional can deflate the balloon. If Eves needs more details she can email me.
The US has rejected contact tracing as has the UK, so that is a valid assumption.
And I can tell you in the US there is no way to build new buildings given our design and approval process in 24 months, even if an existing hospital were to own unused land for expansion purposes.
The four recommendation from Tedros at WHO clearly stated ALL FOUR ARE NEEDED.
“Testing, contact tracing, quarantine and social distance. Do them all.” In China the government discipline made contact tracing possible, as you mentioned, Yves. In the USA-not so much.
It’s not just that we aren’t prepared to devote the resources to contact tracing. We are also not doing the testing to identify cases early enough to make that feasible. Intensive testing and contact tracing go together.
The four recommendation from Tedros at WHO clearly stated ALL FOUR ARE NEEDED.
“Testing, contact tracing, quarantine and social distance. Do them all.” In China the government discipline made contact tracing possible.
As you mentioned, Yves. In the USA-not so much.
From the UK’s Trades Union Congress, some approaches which would have had free market’eers frothing at the mouth a few weeks ago at the very idea, but I suspect will be the subject of a clamour to have introduced in pretty short order:
All seem pretty sensible to me. Apart from the usual “working families” nonsense. I guess it’s become ingrained now and people recite it parrot-fashion after repeated hearing. But nothing that can’t be put in place in weeks, not months. I would of course add “job guarantee” where government hiring can be realistically implemented in short order without causing resource drains elsewhere.
The spirit of FDR, which was to try lots of things and see which ones worked, would be helpful now. A “CCC” which did errands, food and medicine deliveries would be a good start. Income for the workers and services for the citizens. The idea is to be creative and adventuresome with the power of the federal government. If nothing else it gives people confidence that something productive is happening, versus the do-nothing complacency of the neo-Hoovers.
Bravo!
We need bread, and after that work that builds the community. Send out the checks and give us work!
See the link below with Richard Murphy’s action plan.
https://www.taxresearch.org.uk/Blog/2020/03/18/a-plan-to-let-the-country-survive-the-economic-crisis/
Whatever they THINK they need to inject, it needs to be bigger than that, because as Yves has identified, it’s no simple process to get the money to the people at the bottom who most need it fast enough.
And it HAS to go into the hands of individual households, and this is no time to be fooling around with means testing because there just isn’t enough time. Most of all it needs to go in at the bottom of the income distribution, because the whole structure is “trickle-up” and when you try to inject it from the top it just accumulates like adipose tissue in a body with metabolic syndrome.
Quicker and more realistic solution is
a $ 10,000 check for every breathing person in usa with some future fiddling about payback. A simple “tax refund” type advance. Most have some form of regular banking relationship and most others have access to a visa/MC type loadable debit card from the local shyster check cashing operation. No garnishing allowed for next 180 days on anyone anywhere.
This Minnie mouse drip drip drip nonsense is what will panic people.
The great restoring will begin…
Print 4 titanium trillion dollar coins and issue red certificate currency to put cash on the street since the usual kingadawoyld types are not trusting each other more the Fed bank note blips on their Bloomberg/bustburg screens…
#TrumpyBearStockMarket now down nearly 10% for the DAY.
Has anyone heard the words ‘ moral hazard ‘ come trickling out of the mouths of Nancy Pelosi, Joe Biden, Boris Johnson et al following the suggestions of UBI , Debt Forgiveness et.etc. ?
Conservative Republican Congressman Tom McClintock (Northern CA) opposed the legislation providing coronavirus relief, saying “In theory, the purpose is to self-quarantine, recuperate or care for family members who are idled or afflicted, but in reality, it opens the door for anyone who wants to game the system.”
…so even R’s can still be despicable.
It occurs to me that the politicians are using substitution, in a “Thinking Fast and Slow” type of way.
People don’t need cash. The politicians are using cash as a substitute for the things that people actually need in a time of layoffs and shortages and distancing.
People need, at a minimum:
Food and household essentials (my niece couldn’t find diapers at the store)
Healthcare at hospitals
Home care
To not be infected in the first place
To not be evicted from their homes
To not have their utilities shut off
Access to news and announcements from the government
Access to true facts about the pandemic
Something to do while they are shut in
etc.
If cash can’t provide these things, sending people cash won’t solve these problems.
Yves, you’re right that $1,000 is not enough. But it’s a h**l of a lot better than what Obama and his economic brain trust of Rubin and Summers did the last time around. At least Trump and Mnuchin are sending something to individuals that will spend it as soon as they get it.
Not everyone need a $1000 check. Even worst case scenarios see unemployment topping at 20%. This means the large majority of workers will continue to work, and continue to get paid, though some will see reduced hours or even temporary pay cuts. Financial assistance should be tightly focused and given only to those in real need – perhaps $5,000 or even $10,000 to each adult. There should no payroll tax cut, which by definition aids those who are working and thus don’t urgently need assistance.
“Even worst case scenarios see unemployment topping at 20%.”
Perchance, where can I find these worst case estimates? I’m not convinced its that low, no offense.
An important step Congress and the president should take to help rescue the economy is to pass into law legislation that would transfer the debt piled on to companies by private equity from the company books to private equity books. Most businesses acquired by private equity are highly leveraged, with many burdened with onerous levels of debt, while their private equity masters divert huge sums of capital to themselves via so-called special dividend payments. In a national emergency this has to stop, and be reversed immediately.
not all oilfield layoffs are virus related…remember the Russians & Saudis have a price war going, & oil has fallen from a high near $65 on January 8th to almost $20 today…somewhere around $50 is where half of wells become unprofitable..
One thing I am thinking it is also the time to push student loan forgiveness. Even though Trump waived interest, you still have to make your timely monthly payments.
If you are in a payment plan, e.g. 10 year plan, it is an absolute requirement that you make every single payment exactly on time. If you miss just one you are booted permanently from the program (and lose eligibility for any other).
Mortgages are going to be another massive problem without specific relief.
In other news, I read the new fangled version of a CDO is a CLO, another securitized monstrosity (corporate debt this time) that will threaten everything.
Could just do like Obama or the EU and dump a bajillion dollars on the TBTF banks! That worked so well. Lloyd and Jamie – so happy to loan $$ to small bizniss.
What about the most vulnerable and poorest Americans? Those receiving SSI and SSD? Will these checks only be for those who paid taxes last year or for truly everyone? People are upset and saying that the average income is $960 a week… How about the millions who must make due on $783 a month? And they may lack transportation, risk their health taking public transportation to get to the store, doctor’s appointments etc.
Does everyone keep forgetting about H. Res. 897? Still can’t get out of committee. Another example of Democrats blowing it.
https://www.congress.gov/bill/116th-congress/house-resolution/897/actions?KWICView=false