- According to a new report from a federal watchdog, the government sent $ 1.4 billion in coronavirus stimulus checks to deceased people.
- People are very angry about this “waste”.
- These people are very wrong. In fact, it’s more concerning than the amount of overpayment outside Too low.
- People are dying, people are unemployed. We should be more concerned that the government is not doing enough, not that the government accidentally paid a bit in a rush to save the economy.
- This is an opinion column. The thoughts expressed are those of the author.
- Visit the Business Insider home page for more stories.
A report by an independent congressional watchdog released Thursday led to a very disturbing statistic: $ 1.4 billion in coronavirus stimulus checks authorized by the Congressional aid bill, the CARES Act, and sent by the government. more than 1 million Americans dead. .
News reports flowed after the report was released and online commentators were horrified. How could the Treasury Department spend so much taxpayer money on dead people? What a blatant example of bureaucratic failure and waste of government.
But I’m here to tell you that not only is that $ 1.4 billion in payments not really a problem, it’s pretty good. Heck if there’s a problem here, it’s because that amount of overpayment was Too low.
“But Bob!” You may be exclaiming. “Look at all the waste, the government will surely go bankrupt spending money like this. How sloppy! How corrupt!
First of all, calm down, you don’t need all the exclamation marks. Secondly, let me explain why this is not a big problem:
- It is better for us to accidentally spend in this case instead of spending less. It was necessary to rush checks of $ 1,200 to households because the economic crisis caused by the coronavirus pandemic was acute and sudden. Most people got their checks within a few weeks of passing the CARES Act, which is much faster than stimulus checks in past crises. Trying to manage the stimulus perfectly, especially given the obstacles the Treasury already faces, would have slowed the process down even further. When a pandemic stops the global economy, time is of the essence, even if it comes with a bit of an overflow.
- It is actually a fairly small amount of overspending. In total, the United States government sent about $ 269 billion in stimulus checks to American households. $ 1.4 billion sent to dead people represents about 0.5% of that. In comparison, it’s like accidentally paying the waiter $ 20.10 instead of a $ 20 round. For such a massive government program organized in just a few weeks, one that helped cushion the economic hardships of millions of Americans, which doesn’t seem to be a great price to pay, right?
- The government is not your home budget. So this is the most important point. I know I made a complete waiter analogy above, but that too is a terrible analogy and I reject it. This is because the federal government does not operate anything like its finances, the finances of a company, or even the finances of a state government. Print your own currency, therefore you cannot run out of that currency. You don’t need to cut down on spending elsewhere to send these checks just because you accidentally sent some money to dead people. It is not as if these stimulus checks came out of a slowly dwindling pool of tax funds, Congress allocated the cash and then the money was deposited into people’s accounts. Simple like that.
Well there are actually a lot of technical things to this that I don’t have time for (you can read economist Stephanie Kelton’s new book “The Deficit Myth” if you want to dig into this). But let’s say, despite what the politicians want you to believe, we can send these stimulus checks, automatically send another round or two of checks, extend the increased unemployment benefits, and increase food security programs if we want without cutting a penny. programs that currently exist. All that is required is that Congress have the political will to do so.
Given the realities of how the federal government’s finances operate and the size of the pandemic economic crisis, the fact that we have only given $ 267 billion, and “spent” $ 1.4 billion of that on dead people, is in actually a bigger problem because it’s very little.
For one thing, the small percentage that accidentally came out means the requirements for getting the checks were probably too onerous, if at all, as Bloomberg’s Joe Weisenthal pointed out. Up to that point, a new report from the Center for Budget and Policy Priorities, based on data from the Census Bureau, estimated that up to 12 million Americans will never receive a stimulus check due to administrative difficulties, unless states work harder to get those checks out to people.
I don’t know about you, but it seems like a bigger problem than 12 million Americans who need help can’t get it, that a fraction of that number of people killed got checks.
In fact, it’s clear that we need to send more checks now, even if they flow to these same dead people.
Millions of Americans are out of work, millions of families worry about where their next meal will come from, and millions of Americans are worried about making the next roof payment over their heads. These are the real crises about which we should demand that the government do something.
Some economists and politicians have suggested that stimulus controls should be dispersed regularly until we have clear signs that the economy is recovering. This would avoid political fights like the ones we are seeing now, where a good jobs report is causing Congress to lower expectations for another round of stimulus despite the fact that the unemployment rate remains higher than at any other time since cases of Great Depression and coronavirus. still on the rise in many states.
But this idea that we are supposed to be appalled at a small technical error that led to relatively less pay to people killed in the process of trying to save the US economy from a devastating collapse reveals a broken mindset and long-standing that has been conditioned to the American public.
We should be leaning towards generosity right now, as my colleague Linette López wrote in a column a couple of months ago. Instead of pointing out to each other (living and dead) that they got too much, we should point the finger at the government for doing too little.
The human and economic cost of this pandemic due to an overly cautious federal response is much more of a scandal, much more of a failure than these additional controls.
