Imagine our surprise. Unexpected glee. Joyful embrace.
Or maybe not.
A week ago, my wife and I were opening the daily mail (mostly junk). Included was an envelope from our good friends at the Internal Revenue Service. We were not anticipating a tax refund. Seeing that return address, we were naturally curious, and a bit anxious, as to what was inside. Was it a request for more information? A statement for some balance due? A notice of some frightful audit?
We are not used to thinking of the IRS as purveyors of good news and distributors of beneficence and largesse. In our binary brains, tax collectors are takers, not givers.
Yet, inside was an “economic impact payment” of $2,800 payable to the two of us.
High fives? Pop a bottle of cheap champagne? Strike up the century-old “Happy Days Are Here Again”?
No, actually our reaction was none of those. Instead, we looked at each other with a glance that silently said, “Why? We weren’t expecting this. We don’t need it.”
While we are nowhere near the tip-top of the economic pyramid, we are fortunate. Comfortable. Well off by any earthly standard.
Our major earning days are largely in the past. (Contrary to popular belief, and of course to their inestimable value, these columns do not bring in goo-gobs of money.) For us, the pandemic entailed plenty of anxiety and inconvenience. But it was not a financial hardship. Our investments did quite well. Life continued apace without financial worry or pain. In fact, we saved a good deal by being largely homebound.
While for others, most often starting with less good fortune and little cushion, this past year has been a trying, difficult economic time. In many cases, it has been devastating. Hours have been cut; jobs have disappeared; meager savings have been wiped out; businesses have folded.
Still, except for those on the very highest economic rungs, this “stimulus” or “relief” payment – or “economic impact” or whatever you wish to call it – was a uniform $1,400 per adult.
A product of President Biden’s $1.9 trillion American Rescue Plan passed by Congress in early March, the single mom living in tiny rented quarters in Fort Lupton, having lost her steady job but working a couple of part-time shifts while trying to somehow keep her kids on task in their virtual classes with lousy WiFi and ancient computers, got that same $1,400 check as did Tracy and myself, both of us largely retired and without any real economic adversity.
Is that what the enlightened and woke crowd means in their new obsession with “equity”?
There is much that is wrong here. The indiscriminate, untargeted, one-size-fits-all nature of these payments speaks to a government with more wallet than refined strategy. Even if that wallet is illusory, consisting of trillions after trillions of indebtedness and money borrowed from next generations.
Certainly, a global pandemic and economic calamity is not the time for the federal government to think small. But that would assume that pennies were being pinched and government was living somewhere in the general vicinity of its means during times of relative peace and prosperity that came before.
Of course, we all know that was anything but the case.
We also know that both political parties are completely complicit in this orgy of spending through good times as well as bad; and that neither party has any claim to credibility when it comes to fiscal management.
For those hurting, $1,400 – even on top of some previous payments – is wholly inadequate to recover and get back on their feet. For many others, ourselves blessedly included, this sum is superfluous and of little effect.
Big picture, a good deal of the country is now drowning in stimulus in an economy that is fast heating and may soon super-heat. In too many cases, employers are having trouble finding new workers as unemployment benefits serve as disincentive for too many in returning quite yet to the job market.
That has been a theme of this past year. Where prior generations dealt with economic freefall by getting off their butts to improve the nation through programs such as the Civilian Conservation Corps and the Works Progress Administration, we have been asked to do little more than stay home, ease into our couch, gorge on Netflix and collect checks.
There is a governmental trickle-down as well. State governments, so badly wiped out a year ago, are now awash in money thanks to Biden’s $1.9 trillion bonanza. They are also now in on the stimulus action. Even Denver wants to play the game, albeit through borrowed money via a details-later bond issue – an ill-conceived, day-late proposition unlikely to be of that much help to those most needing it.
Of course, all of this is before any infrastructure package with the Biden proposal coming in at a tidy $2 trillion. Most analysts agree, myself included, that infrastructure is one of the best investments we can make. And an overdue one that should have been a centerpiece of the Obama and/or Trump years.
But this sum will be further gasoline on a fiery economic recovery. And it assumes that our country is still able to get projects up and moving in short order, without endless years of bureaucratic, regulatory and legal process.
All told, the economic consequence of this pandemic year will be to further exacerbate the pronounced and growing wealth divide. That trend has too long been with us. But giving checks to couples like us is hardly a redress.
Now some will ask a variation of, “If you were that put off by the check, Sondermann, why didn’t you send it back? Or rip it up?”
Fair question. Though that would imply a level of altruism and naivete we do not know. Despite the rolled eyes, we took the money and deposited it. A good chunk of it will find its way to deserving local charities. The rest will make its way eventually to our kids.
As to the notion of returning the funds, someone please tell the President and assorted others in Washington that if they can get the budget within $2,800 of balancing, Tracy and Eric out in Colorado are good for that final increment.