Socialism? Not really

The federal government prepares to send all of us money and some say that’s socialism. But it’s not. The money doesn’t nationalize any enterprise or make any of us federal employees. It just goes in our pockets for the effort of going to the mailbox.

It’s more accurate to say we’re all Keynesians now. John Maynard Keynes was the economist who advanced the idea that government could intervene and spend at a deficit to drive economic activity.

But that’s not exactly what we’re doing here. We’re spending to keep people on their couches so that they won’t breathe on each other in the workplace.

This virus is grinding our economy to a purposeful halt. People living paycheck-to-paycheck who got sent home to hunker from the germ may soon have no money with which to buy groceries and pay rent.

Their poverty then would trickle up to the people who normally collect their rent and sell those groceries. Pretty soon we’d be in what you call a cratered economy if we’re not there already.

An idea for which U.S. Sen. Tom Cotton gets some credit—along with about a dozen others, mostly but not all Democrats—is for the federal government to blow through these back-door notions about paid leave, tax credits and debt deferment and simply mail everyone except the richest some walking-around cash.

The government would get this done in the next couple of weeks, because groceries and rent don’t wait.

We’ve done that before in times of desperation and panic. Experience tells us the poorest will put that money right back into circulation—because it’s the only money they’ll have.

The rest will probably save it if they can for a day even rainier than today, at which point the government would probably send them another check.

Most of these current proposals call for a second payment in maybe a month and even a third in the summer, depending on how long we stay bunkered from the virus.

Cotton has been as bold as anyone, calling for monthly checks as long as it takes and as much money as it takes.

He seems to consider this a big moment. He also may be wanting to outbid Democratic senators, several of whom have proposed $2,000 now, $1,500 more a little later, and, if needed, another $1,500 after that. The Trump people have been talking about two week’s salary, perhaps repeated in a month.

This will all be part of a “stimulus” package that the Trump administration has brought forward to the tune of a trillion dollars.

You might ask where the federal government is getting that kind of money. The answer, which surely you knew, is that it’s borrowing it.

Treasury Secretary Steve Mnuchin explained Tuesday that this is no time to worry about the deficit.

We haven’t worried about the deficit at all during the current preposterous and profligate presidency. We didn’t worry about it that much when the previous president was initially running it up with the last “stimulus” and then bringing it back down. We haven’t worried about the deficit since Bill Clinton was so naïve as to get rid of it as if people cared.

Dick Cheney once declared that deficits don’t matter. And he appears to have been right.

The argument against a deficit is that it’s dangerous to be over-extended permanently because something bad might happen, and then what would you do?

Something bad did happen in 2008. So we borrowed more. And now something bad has happened again. So we will borrow more again. And there is no tangible consequence.

At least when your parents told you not to play with matches, you could get burned. The federal deficit is an eternal flame that is not hot to the touch.

That sociologist I was on the radio with that time may have been the best economist of all. He scoffed at my reference to deficits that couldn’t be sustained.

There is no such thing as money in regard to nations, he said. There are simply delicate relationships between lenders and borrowers. And it’s never in anyone’s best interest to disturb the delicate balance, or so he said.

I didn’t think he was right, but now I’m going to get a check in the mail from the government and there’s not going to be any consequence that I can see.

We’re not socialists, for heaven’s sake. But we’re not committed capitalists either. We’re spend-ists. We’re debt-ists. We play with cool eternal flames.

As Mnuchin further explained Tuesday, borrowing is easier in the current case because the Fed just lowered the interest rate to zero. So it’s free money. Ostensibly, you need to be good for the principle. But that’s all. And you can probably borrow more to cover that.

That’s not a house of cards. It’s relationships.

This isn’t socialism. It’s survivalism.