The Ö: I spoke to the National Restaurant Association’s top lobbyist on Thursday, who told me that the retail group estimates that 3 percent of restaurants have already been forced to close permanently. If companies remain closed for a month or two, I can imagine that this number will increase. How many bars, restaurants, Newspapers and other companies will never open again? And how will these closings and bankruptcies affect the overall economy? It is too early to know.
Ryan: 100 percent. We still know so little about the virus, not even whether it is seasonal or not. So this could become an annual problem, even if it is contained in 2020. And we don’t know which economies can start and when: don’t forget that it’s still the end of summer in the southern hemisphere. Many countries, including vulnerable regions in Africa, could be wiped out here. We are already seeing governments recognize that they are too dependent on China in their supply chains and unprepared for the supply of medical devices. So you will see many more foreign investment reviews and efforts to restrict key material exports.
How do direct payments work? Who gets a check? Will small businesses stay solvent? And what kind of control will there be on how the money is distributed?
Andrew: Every American whose income in 2018 was less than $ 75,000 will receive a direct payment of $ 1,200 from the IRS in addition to $ 500 per child. The total value of the payment will drop to $ 99,000 for people who earned more than $ 75,000 in 2018. If you have already submitted your tax return for 2019, your income for 2019 will determine the amount you will receive. Note that the IRS has extended the 2019 registration period by three months until July 15. For small businesses, the bill contains more than $ 350 billion in available loans – that is, if a company uses the funds to continue paying its employees and for other essential purposes, the company is unlikely to be required to transfer the money to the To repay government. Legislation also provides for strict monitoring of the money going to larger companies, including the creation of an inspector general and a congressional committee to oversee the process.
The Ö: The structure of the congressional supervisory body is reminiscent of the structure used to monitor bank bailouts during the 2008 financial crisis. The chair of this body? Elizabeth Warren, who was a Harvard professor at the time and was tapped by Senate Majority Leader Harry Reid. Will current oversight efforts initiate political careers?
Caitlin: Another notable detail of this $ 500 billion business assistance program – in addition to oversight by an inspector general and a special congressional body, the final bailout package prohibits companies that receive credit from the president, members of his family, members of his administration, and members of congress . Supervision was added after the Democrats contradicted a previous Senate bill that they thought gave the Treasury Secretary too much power, but the Republicans claimed they never opposed these additions.
Ryan: I only moved to the USA in 2019. I assume that my check will never be mailed. And with that in mind, why does the United States still have checks at all? More and more countries are banning them overall. For the next pandemic: direct deposits and one-time debit cards would be safer and more efficient sales systems.
Victoria: Actually, all three are payment options on the table.
Legislators on both sides of the aisle strongly objected to the $ 2 trillion aid package. Why did it pass 96-0 in the Senate?
Andrew: One word: urgency. The Senate had no time to hold hearings, discuss amendments, and otherwise go through normal legislative proposals. For some people, this is an indictment of the trial itself and further evidence that the institution is broken. However, lawmakers on both sides of the aisle stressed the urgency of economic relief given the rapid pace of cascading financial implications. While the Senate was negotiating with the White House, American companies made immediate decisions about layoffs and long-term closings. Senators said these companies needed security and needed it quickly. So while everyone could find something in a $ 2 trillion package that they didn’t like, everyone ended up agreeing that the alternative would be worse.
Anita: Of course, there are things Republicans and Democrats didn’t like about this bill. The same applies to Trump, whose finance minister Steven Mnuchin negotiated with the legislature on behalf of the government. How could there be some things they didn’t like in an 880 page bill of a whopping $ 2 trillion? But senators have heard of voters who are unemployed, industries that have problems, and hospitals, cities, and states that desperately need money. They didn’t want to go home to their states without showing that they had done everything to help.
Is Trump’s goal of reopening at least parts of the economy after 15 days realistic?
Anita: Trump is expected to announce what he sees the next step Moving forward early next week as his 15-day social distancing plan comes to an end. He could extend the national guidelines for a while, but I wouldn’t be surprised if he starts to relax them for some parts of the country. However, keep this important distinction in mind: Trump and federal officials issue guidelines. Local and state officials are actually the ones who have ordered measures – school, park, restaurant, and restricted meeting closures. Most have not indicated that they are ready to reopen something. In fact, they’re still ordering additional closings, even though Trump is talking about the country’s reopening. So the Americans will be more confused than they already are: your president will tell you one thing and your governor will tell you another.
Sarah: Public health officials firmly believe that 15 days are not enough to contain the virus. The president’s desire to reopen economic sectors could spark a struggle with state and local leaders, who, as Anita said, are the ones who set the rules for opening companies. Most states and cities with some form of closure – whether it is emergency shelter in the Bay Area or nonessential business closures in a number of states – have implemented these measures by April, if not longer. In the meantime, several states have closed schools for the rest of the school year – even the Olympic Games have been pushed back. The President can ask people to get back to work, but realistically, it’s not up to him.
Victoria: Agree with Anita and Sarah, and there’s one more point here: the economy won’t return even if all restrictions are lifted. With no signs of things getting better, people will still know that there is a pandemic that could be life-threatening, and so many people will still be reluctant to return to restaurants, travel, or do other things they’re not doing at the moment. And many people will be sick or take care of sick family members. That’s why economists, including Fed chairman Jay Powell, have said the virus will set the economic recovery schedule. In addition, national unemployment claims were an astounding 3.3 million last week, almost five times the previous weekly record. You can’t just snap your fingers and undo that.
Ryan: The United States is not a single outbreak center, but that doesn’t mean that it is easy to reopen certain states and counties. It just means that many, many fires are burning at the same time. There are at least a dozen states with 1,500 or more cases. Cities like Detroit, New Orleans and Atlanta will continue to be problems for a while. Knowing what to restart and what to shutdown depends on good data, and that’s missing. And it depends on the lack of federal coordination. And since there are so many asymptomatic carriers and no vaccine, based on current systems, it is very optimistic to think that we know how to control this. If the government insists on a quick reopening of the economy, I would expect some states and counties to reverse their course at some point if it turns out that the virus is actually not under control in their area.