Focus stimulus on those most in need

Columnist E.J. Dionne offers his take on what the federal government should do amid the coronavirus outbreak.

WASHINGTON » The coronavirus crisis might have represented an opportunity for our political system to show what it could accomplish when a common threat put the common good on the minds of everyone. And the accompanying economic crisis should have led to fast action to help Americans most vulnerable to the ravages of lost jobs and lost income.

The early returns are not good on either front.

There is no need to elaborate on President Trump’s manifest unfitness for leadership. Every day brings more lying, more self-involvement, more pettiness and more lashing out at anyone who dares to point out how unprepared his administration left the country.

Thus, when Illinois Gov. J.B. Pritzker, a Democrat, told CNN on Sunday that the nation’s hospitals were running far short of safe gowns, surgical masks and gloves, and that “this should have been a coordinated effort by the federal government,” our petulant leader lashed out at Pritzker and the media on Twitter. They “shouldn’t be blaming the Federal Government for their own shortcomings.” And never mind that it’s the governors and mayors who are saving us now.

Here’s an idea for a highly efficient economic stimulus and confidence-builder: The president of the United States should just shut up for an extended period.

But, yes, the economy also needs Congress to pass practical measures to prevent economic collapse. So it was deeply discouraging that what might have been a bipartisan stimulus effort faltered Sunday when Senate Republicans insisted on including in their bill a $500 billion corporate bailout fund that would be administered by Treasury Secretary Steven Mnuchin. It contained few safeguards on how he would dole the money out, and Treasury wouldn’t disclose who it was helping for six months.

Sen. Elizabeth Warren, DMass., characterized the plan as “a half-trillion dollar slush fund,” which seems entirely appropriate and doesn’t inspire confidence. You would like to hope Republicans will eventually figure this out.

In the meantime, Senate Majority Leader Mitch McConnell’s decision to keep House Speaker Nancy Pelosi at arm’s length until Sunday may prove to be another miscalculation. Pelosi looked at what the GOP Senate was up to and, quite reasonably, said she wants the Democratic House to produce its own bill. This will either slow the process — or, to be optimistic, push McConnell toward much-needed flexibility.

The simple truth is that the nation needs a huge stimulus bill because we are staring at an economic catastrophe. Greg Leiserson, a member of the Council of Economic Advisers in the Obama administration now at the Washington Center for Equitable Growth, laid out the imperatives: “Err on the side of being too big rather than too small, be sure help continues as long as it’s needed, and address the public health crisis.”

On size, the $1.8 trillion stimulus that the Senate is contemplating sounds big, but it may yet prove inadequate to the task. In response to demands from Senate Minority Leader Charles E. Schumer, D-N.Y., some big improvements were made on an earlier Republican proposal by substantially increasing funding for unemployment insurance and extending it over several months — although it would be far better if the beefed-up program were extended through the life of this economic crisis.

The final bill needs more money to help states through what will be an enormous fiscal crisis — without it, layoffs will multiply — and stepped-up relief through the food stamp program that might also be extended to help renters who face eviction.

And Congress has to be creative to make sure the proposed one-time payments of $1,200 per adult and $500 per child are not only allocated to the poorest people in the country (most were cut out of an earlier version of the proposal, since corrected) but also get to them fast. This will be challenging because millions among the very poor do not file income-tax returns. “You really need to get the money out as quickly as you can ... and to use as many channels as you can to get the money out,” said Jacob Leibenluft, senior fellow at the Center for National Progress.

But this entire episode points to a glaring weakness of our nation’s economic policy: We should not be as dependent as we are on slapdash emergency action by Congress in a crisis.

Thus, one good thing that could come out of this emergency: A system that would automatically put stabilizers in place to keep a downturn from becoming a death spiral. Various forms of support — from unemployment insurance to food stamps to emergency aid to the states — should kick in when economic indicators turn negative. This would be good for needy individuals and families, but also for the economy as a whole.

But for now, Congress needs to focus urgently on the individuals, families, small businesses, health systems and charitable groups facing calamity. Just this once, can they show us democracy’s best side?