We need people to stop working
But we don’t need them to become unemployed
Congratulations, America, you hit a record: 3.3 million people filed for unemployment in a single week. That might sound like sarcasm. It’s not. We needed those 3.3 million folks to stay home. In fact, we need tens of millions more to do the same thing. For the first time in history, our No. 1 policy goal is to prevent people from working. So in some sense, record unemployment numbers are a terrific victory.
But they are also a monumental policy failure, because while we need people to stop working, we don’t actually need, or want, them to become unemployed. If members of Congress had grasped that they were facing an entirely novel sort of crisis, we’d have gotten a better relief bill, and much sooner than we actually did. One that could have kept many of those people in work.
Congress could have done what governments in other countries have done, notably Denmark and Britain: offered to pay employers to furlough workers, rather than laying them off. Britain is promising to replace 80% of the salary of those workers, through grants employers will get from the treasury. Denmark is offering to pay 90% of the wages of hourly workers who have been sent home, and 75% of the pay of salaried workers. There are also other forms of assistance to help employers cover fixed expenses as their revenue drops.
By keeping workers attached to their employers, and keeping employers solvent, these countries will make it easier for the economy to restart when the epidemic is under control. Our Congress, unfortunately, seems to be struggling with the idea that this is not your standard recession.
To their credit, lawmakers did eventually settle on a relief package of unprecedented size.
To their discredit, they took too long, produced only middling results and made no provision for what they’ll do if additional relief proves necessary.
Worse, the process suggested that they don’t really understand that new problems require new ideas.
Democrats wasted time trying to restructure the relief bill as they always do, to punish any company that required assistance — as if those companies had grievously wronged us by failing to be in the “delivery-ofbasic-goods-and-services” business at the moment when a once-in-a-century pandemic struck.
Once the Democrats were done dragging their feet, Republicans had to pause for a good scuff of the carpet, fretting that a four-month, $600-per-week top-up of unemployment benefits was just too darned generous to the unemployed slobs we’re forcing to stay home.
“We’ve incentivized people not to go back to work,” said Sen. Lindsey Graham, R-S.C. This was, of course, the point.
Worrying about moral hazard during a pandemic misses that point by a country mile. And structuring so much of the relief through the unemployment system means we’ll struggle to put the economy back together when the time comes. Most worrying of all, Congress doesn’t even seem to be contemplating the need to change course.
Now that work on the relief bill is all over but the shouting, Congress is preparing to leave town and shelter in place along with their constituents. What happens if it isn’t enough? Do they fly back to Washington, possibly picking up something along the way, and then infecting their colleagues with it?
Congress could easily switch to remote voting for the duration of this crisis; if legislators are worried about hackers interfering, it wouldn’t be very difficult to set up an old-fashioned system where recording clerks collect the votes by calling each legislator at home. Sens. Rob Portman, R-Ohio, and Richard J. Durbin, D-Ill., have been pushing for some sort of remote voting capability, and Congress should have enacted some sort of emergency measure before adjourning. Unfortunately, both the speaker of the House and the Senate majority leader seem to have rejected the idea out of hand.
If this epidemic proves as bad as many fear, the relief package just passed will prove inadequate, and our legislature will need to do more. But the same mind-set that kept Congress from matching the scope of its action to the unprecedented breadth of the crisis will now make it harder for its members to come back to Washington and do what’s needed.
The 3.3 million people who filed for unemployment last week already understand that we’re facing something entirely unprecedented. Congress obviously doesn’t, yet.