Former White House Communications Director, Anthony Scaramucci went to Twitter tonight with his bullet point $3.2 trillion “wartime” stimulus proposal.
Here’s are the details of his brief:
Congress and Trump admin have been discussing $750-850 billion stimulus packages to mitigate economic damage from the coronavirus pandemic. That’s not nearly enough. We need to think bigger – 3x bigger – and smarter if we want to avoid a deep depression. Here is what I propose:
We should be treating this like wartime. That’s how grave it is. During WWII we ran deficits as high as 26% of GDP. Using 20% of GDP (1945) as a point of reference, we still have room for another $3 trillion+ in fiscal stimulus. We should overwhelm the enemy with firepower.
1) SEND CASH – Send $3k per adult and $1.5k per child ASAP to every American household to cover immediate financial needs. If it doesn’t slow down the process, means test it targeting families earning less than $85k (75% of the country). Cost ~$800 billion.
2) JOBS BACKSTOP – Become “buyer of last resort” to replace lost revenue across industries. Co’s receiving aid can’t lay off workers & must suspend dividends/buybacks/bonuses for 5 yrs. Universal paid sick leave is guaranteed by gov’t. Cost ~ $2 trillion ( See : Keeping Business Alive: The Government as Buyer of Last Resort )
3) CUT TAXES – Eliminate federal income taxes this year for the bottom 75% of US households, or those making less than $85k. Suspend mortgage, rent and student loan payments. Cost ~$250 million.
4) HEALTHCARE RAPID RESPONSE – Rapidly expand capabilities of the US healthcare system to confront the virus, including free drive-thru testing and specialized hospital facilities. Cost ~ $150 billion.
The post-GFC recovery was slow because we lowballed the stimulus in 2009. Don’t make the same mistake. Borrowing rates are at historic lows and we are the wealthiest country in the world. Err on the side of overreacting. Act boldly and decisively.