Bail out people, not corporations
The coronavirus relief enacted by Congress more than three weeks ago is barely reaching Americans in need.
Checks of up to $1,200 are being delivered through direct-deposit filings with the Internal Revenue Service. But low-income people who have not directly deposited their taxes won't get these checks for weeks or months. Worse yet, the Treasury is allowing banks to seize payments to satisfy outstanding debts.
Meanwhile, most of the promised $600 weekly extra unemployment benefits remain stuck in state unemployment insurance offices now overwhelmed with claims.
None of this seems to bother conservative Republicans, who believe all such relief creates what's called "moral hazard" -- the risk that government benefits will allow people to slack off.
Republican Sen. Lindsey Graham, for example, says state unemployment offices are overwhelmed because the extra $600 is "incentivizing people to leave the workforce." Hello?
When it comes to big corporations and their CEOs, however, Republicans don't worry about moral hazard. They should.
Before the coronavirus, corporations were borrowing money like mad, capitalizing on the Fed's bargain-basement interest rates. Total corporate debt topped $16 trillion last year.
Corporations used much of this debt to buy back their own shares of stock. This raised the earnings of each remaining share, creating a bonanza for big investors and top executives.
Donald Trump never tired of pointing out how spectacularly stock prices had risen on his watch. But he neglected to mention that those stocks were floating on a rising sea of corporate debt -- which left corporate America dangerously unprepared for any sharp downturn.
Then came the coronavirus and the sharpest downturn on record.