Wednesday, May 20, 2020

Strategic procrastination

The GOP is in no hurry to work on a fourth stimulus bill.  They complain that existing allocations have not been spent. They worry that provisions for voting by mail will hurt them by preferentially enfranchising Democratic voters. They want liability protection for small businesses (of which more later). These are the overt justifications; but another plausible explanation is that they want to force people back to work, regardless of the disparate impact and risks of a fast re-opening.

States can't run deficits, That means that as income declines with people out of work and taxes plummeting, states must either cut services or raise revenues; and since they can't borrow, the only way to raise revenues is to get the economy re-started.  And with the economy restarting, the message in the run up to the election will be "we beat it, we put money back in your pockets, while the Dem's wanted to keep you poor to protect the illegals".

It's bold, quite clever, but risky; if the second wave does return, something made much more likely by fast re-opening, they may get the blame. But if Trump has shown us one thing it's how effectively he can shift blame onto others. So when the second wave comes, the message will be "that's not on us, that's on the governors". The recovery will be more V than L shaped, the stock market will be near twenty eight thousand. Most people feel life is back to normal.

The GOP has evidently concluded that to remain in power, a few more deaths are worth it to get the economy back on track. When Senator Patrick Toomey re-frames the lock-down as simply an effort to prevent the healthcare system from being overwhelmed he can declare "mission accomplished" despite rising the number of cases and the infection growth rate R, still being being very close to one nationally and much grater than one in many states. That's a clear indication that his priority is the economy, not mitigation of the disease.

When economic activity is the top priority, liability protection becomes important; it allows small business owners to restart with much less rigorous covid-related health precautions than they would implement if they were at risk of being sued. That helps accelerate the reopening.  And Trump's continued refusal to wear a mask is part and parcel of the blasé, "covid is nothing terribly serious" attitude he wants to project to get consumers back to work and back to buying. 

Of course the death toll will be higher that it would otherwise have been, but that's hard to prove; comparisons of an actual outcome with an unrealized path not followed are easy to manipulate: "That's what some scientists predicted but here's another scientist who says something quite different". We've seen that cherry-picking of scientific outliers in the climate change debate. Without the vaccine some (the old and the sick) will have to voluntarily self-quarantine; but in the GOP playbook that's OK since they are not economically vital and if some of them vote for the Dem's, that's a price worth paying.

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