rickair7777

Yes. The fed should not just be mailing checks. OK, maybe for a few weeks just that one time.

But now we know better, it should be processed through the system (each state already has one as you say).

DarkSideMoon

You’re looking at it as “This goes beyond making someone whole!”. And you’re right. I just chose to think of it as a stimulus, which helps those of us still working stay employed. Server friend of mine was making basically twice what she made as a server. She also paid her rent on time, and more importantly, blew money on goods and services. Meanwhile, I limped along on 60% pay and ate ramen noodles and the zucchini from my garden, contributing next to nothing to the economy. In order to keep the economy from completely flatlining, we needed to give people cash and confidence to spend instead of squirreling it away in a mattress somewhere. If that means someone that usually makes 1/3 of what I do gets a little extra cheddar for awhile then bully for them.

tallpilot

Well I’m glad she didn’t save any of that money, that would have been foolish. What you quoted is Keynes widely disproved ‘paradox of thrift.’ People saving money would create a cushion for a rainy day (or year) and if invested in productive endeavors would grow the overall economy. There are reasons why that fails in our hyper-financialized economy but it remains true we are better off if your bartender friend were incentivized to go back to work.

DarkSideMoon

You’re right, this whole thing would be economically better if she got evicted and moved back in with her parents. Lots of relevant available work for a laid off server right now, definitely not a competitive market all. I’m not here to praise reckless spending, just pointing out why over-paying unemployment may not be the worst thing in the world even if we’re not directly benefiting.

We have to spend our way through this and have some austerity when things get good again. You can spend your way out of a recession if you actually turn around and pay the piper when the economy is healthy again. Unfortunately we did the opposite when we recover from ‘08.

Roy Biggins

Is there any intention on getting this debt under control at any point in the future? I’m not saying we should or shouldn’t spend our way out of this, but our debt should be alarming to everyone. At what point will our tax dollars not even pay the interest on this debt? If the world loses faith in our currency, we are completely F’d.

DarkSideMoon

That’s my sincere hope.

FAAFlyer

Federal money is created by the federal government. Taxes don't fund federal government spending.

Theoretically we could use coinage (the US Treasury is in charge of minting coins through Mints) to fund federal reserve notes (the Fed is in charge of printing federal reserve notes through the Bureau of Engraving and Printing) and incur zero debt. But then we would not be creating risk free interest bearing assets.

FXLAX

What is wrong with paying unemployed people what they originally earned? That would accomplished the same thing the airline bailout did for their employees? Are airline workers currently employee making an extra $600 a week for no extra work? The waitress and airline employee will still be able to maintain the same lifestyle they had on the money they earned before COVID.

The whole point of the cares act was to give people that lost their jobs, through not fault of their own, the same amount of money they were making (or keep them employed as in airline employees). So why is it okay now to continue to give people more than they were originally making on the expense of the taxpayer?

Seems to me that the airline employee bailout and the unemployment benefit were meant to accomplish the same thing in two different ways, for workers to keep the same amount they earned pre-COVID. Not to pay some people more not to work while keeping others employed.

Roy Biggins

So you’re saying federal taxes can’t be used to pay off federal debt? I’m no economist, so I’m not going to even pretend to argue with what you’re saying. I was always under the impression that federal taxes would be used to pay into federal debt or interest on our debt (which several countries own part of). Regardless, the way we keep printing money is not going to end well for us.

Trappy

Assuming that you are referring to pilots when you say "airline workers," the two are not comparable. The waitress lives paycheck to paycheck and does not make 2x+ the average household income. Should the taxpayer pay corporate executives 7/8 figure unemployment benefits so they can keep their lifestyles? Unemployment is to keep people from living on the streets when they lose their job. High-income individuals who are in notoriously unstable industries should not live above their means, have an emergency fund, and/or have a backup imo.