Taxpayer Alert - A Massive Stimulus Spending Spree Is Being Unleashed | Citizens Against Government Waste

Taxpayer Alert - A Massive Stimulus Spending Spree Is Being Unleashed

The WasteWatcher

On January 14, 2021, President-elect Joe Biden announced a $1.9 trillion COVID-19 “relief” and “stimulus” bill, which will bring the total spent in response to the pandemic up to $5 trillion.  Like the prior bills enacted by Congress, this one also spends the taxpayers’ money on projects and programs that are not clearly related to the pandemic.

The $600 per person stimulus payments that were included in the Consolidated Appropriations Act, 2021 (Public Law 116-260) will be increased by $1,400 to a total of $2,000.  The proposal also includes a federal minimum wage of $15 per hour.  While that amount was a bad idea before the pandemic, as numerous studies show it will increase unemployment, it is a ridiculous idea after lower-income workers have been the most adversely impacted over the past year.  Small businesses that employ low-wage workers, especially restaurants, are already having a hard time getting back on their feet.  Increasing the minimum wage to $15 per hour will make it even more difficult for them to recover.

Stephen Moore wrote an op-ed on January 14 in that concluded the Biden proposal “could destroy 4 million jobs” due to "all of the free money makes work less essential and — in many cases — less financially attractive than getting off the couch and working."

The Biden proposal also includes $350 billion for a state and local government bailout, something that has been strongly opposed by Republicans and fiscal conservatives, which kept it out of the $900 billion COVID-19 relief portion of the Consolidated Appropriations Act.  State and local governments  received $360 billion from the federal government in 2020, and many states that initially thought they would have a shortfall ended up with more money than expected, particularly California, which has a $26 billion surplus.  This money has been and should continue to be called a bailout rather than “relief.”

Indeed, it appears that the President-elect’s plan is taking a page from the Obama-Biden stimulus plan, but more doubling the amount.  Throughout the rollout of the 2009 stimulus plan, Citizens Against Government Waste highlighted wasteful spending and programmatic pitfalls of the supposed “shovel-ready” recovery programs.  While one might hope there would be improved oversight in the Biden proposal, it is doubtful that the incoming administration has better insight into how to address the potential for mismanagement and failure than the government did for the 2009 stimulus program.   

Citizens Against Government Waste offered 10 principles to Congress for emergency spending packages on April 1, 2020.  They should all be applied to the Biden plan:

  1.  Emergency spending bills must be temporary and targeted.
  2. There must be transparency and accountability in how the money is spent, including regular audits by agency inspectors general and the Government Accountability Office.
  3. Every emergency spending bill enacted in response to healthcare, financial, or physical disasters should be free of extraneous provisions.
  4. Taxpayers must be protected by ensuring that the money is spent only for the purpose at hand through an online tracking and reporting system.
  5. The federal government should use its powers to determine what should be produced to meet emergency needs in only the direst circumstances, and such actions must be temporary.
  6. To prepare for the next healthcare, financial, or physical emergency, every level of government should be reducing waste, fraud, abuse, and mismanagement, as well as setting aside money in rainy day funds and supplies in emergency stockpiles.
  7. Legislation in response to national emergencies must not threaten or reduce Americans’ personal freedom and liberty.
  8. The government should not impose price controls on the healthcare industry because that will result in fewer new innovative drugs and medical devices.
  9. Initiatives to loosen regulations and remove red tape that are expediting the government’s response to the coronavirus crisis and other emergencies should be evaluated to determine whether permanent changes would continue to encourage the development of new technologies, medicines, and the deployment of goods and services to better prepare the nation for future healthcare, financial, or physical disasters.
  10. Any effort by Democrats or Republicans to use the coronavirus crisis or other emergencies as an excuse to institute unrelated reforms or restructuring to promote a political agenda must be vigorously opposed and defeated.

If President-elect Biden truly wishes to unify the country, he should not start with a massive, controversial spending bill, followed by massive, controversial infrastructure and appropriations bills.  There truly is a limit on how much the federal government can spend before the nation heads down the path of irreversible bankruptcy and financial ruin.

The new Congress and administration have a responsibility to ensure that taxpayer resources are used sparingly and appropriately to address immediate pandemic concerns without including unrelated initiatives in emergency spending packages.  To do otherwise would be a great disservice to the American people who elected them.






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