Trump Floats Payroll Tax Cut. Calls It "Very Substantial Relief".

[astonmartin708]

Just in time for people to be quarantined from their jobs for a couple weeks at a time.

 

[lawpoke87]

Trump also floated the idea of a temporary unemployment benefit for displaced hourly workers. Anyone see any downside to this ?

 

[astonmartin708]

Trump also floated the idea of a temporary unemployment benefit for displaced hourly workers. Anyone see any downside to this ?

I did see that, but I'm not sure it's plausible, or even helpful. The US government can't afford to subsidize the wages of every hourly worker in the US.

 

[ba11game]

Isn't this the same thing as cutting funding for Social Security and Medicare?

 

[lawpoke87]

I did see that, but I'm not sure it's plausible, or even helpful. The US government can't afford to subsidize the wages of every hourly worker in the US.

I don’t believe we’re talking about every hourly employee. My understanding of what’s being discussed is benefits for those place under quarantine.

 

[astonmartin708]

I don’t believe we’re talking about every hourly employee. My understanding of what’s being discussed is benefits for those place under quarantine.

Depending on the continuing outbreak level, that could be most of the country for some short period of time. (If we get to Italian type levels)

 

[Watu3]

Better idea might be to make testing widely available and free. Then pay for treatment, particularly if an hospital is required. Loss of income is one thing, but fear of medical bills will only help spread the problem.

 

[Clong83a]

Better idea might be to make testing widely available and free. Then pay for treatment, particularly if an hospital is required. Loss of income is one thing, but fear of medical bills will only help spread the problem.

The thing about the Chinese (very successsful) response is that they don't have to worry about where the money will come from, or any other procedural issues on how to get things done. The government there can say to a contractor "Build a giant temporary hospital. 1000 beds. Build it on this street corner. We will figure out the funding later" They can also go to a random factory outside the quarantine zone and say, "You guys. Ventilators. Lots of them, forget whatever else you were building or what ever other contracts you have. We will reimburse you for your efforts". And they can say to everyone else, "Everyone stay home. You will not be evicted or lose your job for being home. You will, however, be punished severely if you are caught in public without an essential travel permit." And it all gets done.

I am NOT suggesting that we model ourselves after the Chinese and taking over the means of production and control over daily lives to enable this kind of thing. Their method has many problems that are completely antithetical to US ideals. But it is pretty well custom built to deal with a pandemic effectively.

All of this is to say I think this episode will affect the West much harder than China, and perhaps the US particularly so. If this ends up being bad, then it may force us to take a long hard look at our system and make some changes, like nationally guaranteed sick leave. Again, I am not suggesting that we emulate the Chinese system just in case of another future pandemic. It's not either/or. But we can look at other nations that have been relatively successful at containing it, like South Korea, and try to figure out something that will work better without compromising our ideals.

There are stories coming in everywhere from people who are symptomatic and have been authorized for the test but have still been waiting days to receive it due to limited supply and/or testing capacity. At this point, given the cheapness of airfares due to travel fears, it may be cheaper and faster to fly to South Korea, go to a drive through testing center and fly back rather than rely on the CDC. Only half joking. It really is crazy that they cannot scale up testing on this to meet demand.

 

[lawpoke87]

I really hope we take a look at the CDC after this crisis is over. There’s really no excuse for not having 200k plus tests ready and distributed to the likely outbreak areas. We knew this was coming for well over a month.

Hard to compare the US to China imo. China can force quarantine entire cities. China can develop drugs without worrying about negative side or long term effects. China can build temporary hospitals without complying to building codes or safety concerns.

Tests need to be free or 100% covered by insurance. I’m on the fence about forced mass quarantined but high numbers of infected would take me off said fence. We need to fast track drugs which combat the secondary infections (the ones that kill people). We need to start mass production of said drugs while obtaining approval. I know it’s ambitions but those drugs need to be treating the critically ill within three weeks.

 

[aTUfan]

Some are promoting the idea of employee paid leave for the virus. This can be a huge financial cost to businesses. Instead just give a federal tax deduction to quarantined people to help compensate for lost wages.

 

[Watu3]

The problem with cutting payroll taxes is the effect on Social Security and Medicare. Trump’s 2020 budget already calls for cuts in both. And these cuts would further undermine their financial under pinnings.

The problem is that public’s goals and Trump’s are different. Trump’s goal is reelection which depends on a strong stock market—so low interest rates, tax cuts and happy talk are his tools. Meanwhile the public needs a focus on stopping the virus spreading; expanded, no cost testing; reduced fears about ghastly medical bills, and straight talk. Those cost money. Raising the cap on earnings taxed by social security and increasing medicare taxes on the wealthy to finance these efforts makes more sense if public welfare is the goal.

 

[lawpoke87]

The problem with cutting payroll taxes is the effect on Social Security and Medicare. Trump’s 2020 budget already calls for cuts in both. And these cuts would further undermine their financial under pinnings.

The problem is that public’s goals and Trump’s are different. Trump’s goal is reelection which depends on a strong stock market—so low interest rates, tax cuts and happy talk are his tools. Meanwhile the public needs a focus on stopping the virus spreading; expanded, no cost testing; reduced fears about ghastly medical bills, and straight talk. Those cost money. Raising the cap on earnings taxed by social security and increasing medicare taxes on the wealthy to finance these efforts makes more sense if public welfare is the goal.

I would argue there needs to be a combined approach. We need to stop or at least slow the spread and develop and distribute a treatment ASAP. We ALSO need to save our economic system. Tens of millions out of work. Massive business failures. Huge numbers of home and auto loan defaults. Unprecedented numbers needing federal assistant. This will also undermine Social Security and Medicare in addition to putting a huge strain a what will be an already taxed social service load. Not considering these as public goals as well is simply short sighted. I'm not convinced that the economic damage won't be greater than the actual virus itself.

 

[Watu3]

I'm not convinced that the economic damage won't be greater than the actual virus itself.

You had me until this sentence. As they say, you can't take it with you.

The virus crisis is an good metaphor for the reluctance to address climate change. We saw the virus outbreak in China and knew it was coming our way in December. Instead of taking steps then, the US wasted its chance to prevent it coming to the US by establishing testing programs and instituting other public health measures. Part of the reason was the WH's eliminating its team that deals with international health crises last year, but mainly the focus has been on the market and business news.

We can say we can't afford to do things, but there existential issues that money can't buy. We are pretty good at putting a price of everything, but that's different from knowing what to value.

 

[lawpoke87]

You had me until this sentence. As they say, you can't take it with you.

The virus crisis is an good metaphor for the reluctance to address climate change. .

...and you had me until your third sentence. It wasn't my intent to compare the elderly dying to people losing their homes, not being able to feed their families, etc... because their jobs are gone. The comparison was with numbers. We're talking tens of millions without jobs. Tens of millions who have lost their homes. Tens of millions without income to feed themselves or their families. Trying to prevent mass hysteria is absolutely the right thing to do publicly. Humans are capable of very very bad things when mass panic sets in. Our country needs to continue to function as normally as possible while steps are taken to control the spread of the virus. Both are vital to our well being. Why some can't understand this is beyond me.

When China begins to take the steps to address climate change that they've taken to address Corona then we can talk. Until that time, the only comparison would be if China kept self infecting people and sending them abroad to infect others. Other countries are reducing the sick while China is dead set on increasing their numbers and then spreading the virus to the rest of the world.