By Nev March
As we approach the final days of the 2020 Presidential election, a barrage of so-called news seeks to distract us from what really matters. We’re told hourly about President Trump’s COVID experiences, his taxes, his debts, his staff’s exposure to the virus, his trips to wave at his supporters, and his attempts to discredit mail-in ballots. None of that matters.
What matters is who can fix the mess we Americans find ourselves in. We’re facing a double whammy of health risks (a horrific 210,000 deaths nationally and counting, with millions possibly facing long term health risks) and an economy which has delivered job losses to 22 million citizens. Nothing else is as big as this.
If we were in 1930, facing the brunt of the Great Depression, would you waste a second doubting Mr. Roosevelt’s (FDR’s) fitness because he used a wheelchair? He served as US President although in acute discomfort and pain while he was in office. In 1918-1919, Americans faced the worst of the Spanish Flu, which killed 50 Million worldwide, and 675,000 Americans, including many who had just survived the World War I. If we were in 1918, would you fuss about the length of women’s skirts (they got shorter), and that they were soon to get the right to vote? No buddy, no. We wouldn’t.
We’re now facing something approaching the Great Depression AND the Flu pandemic at the same time. It is imperative that we focus on what matters.
Solutions are not sexy, they’re complex and full of risk and have lots of pros and cons–enough to make your head ache. But here’s the beauty of it: we can mine the past for quick start solutions for present troubles because fundamentals don’t lie. Fundamental solutions are complex and painful and get argued over at the Federal Reserve and in Congress and they take a while. And they work!
During his first hundred days in office, FDR formulated the New Deal. He gave 30 ‘fireside chats’ on Radio to help explain and calm people’s fears. FDR ended prohibition (it caused many problems, like marijuana’s war on drugs today). He instituted an economic stimulus package which built roads and highways across the continental USA. Of course, FDR won re-election in 1936 by a landslide (with 98.5% of electoral college votes!)
In response to the worst economic crisis in U.S. history, FDR formulated the New Deal – a series of programs, public work projects, and financial reforms between 1933 and 1939. Today we need another New Deal and a new President with a big and bold vision.
The New Deal also created today’s Social Security program, by passing the Social Security Act of 1935. The New Deal’s three R’s (Relief, Reform and Recovery) stabilized the banking system, abandoned the thousands-of-years-old Gold Standard and finally expanded money supply. Just to put it in context, the Gold standard was a pillar of human government since roughly 700 BC. Many considered it so important that if it were changed, the entire fabric of the monetary system would dissolve into inflation. Dismantling it was a seismic shift in thinking. An enormous federal outlay put the country back to work. These actions were funded by government spending, the use of public funds we DIDN’T HAVE. It was deficit financing to BUILD public assets that fixed the Great Depression.
Students of economics often debate Friedman’s monetarism (traditionally called Republican fiscal conservatism) versus Keynesian deficit spending (usually a position Democrats take). Both are appropriate in different situations. Monetarists resist spending because it can lead to inflation, a lesson that many Republicans have taken to heart. They are right, but not in a recession, when government spending can kick-start a lagging economy. In the 1930s, spending to build America’s roads yielded decades of economic growth.
In response to the worst economic crisis in U.S. history, FDR formulated the New Deal – a series of programs, public work projects, and financial reforms between 1933 and 1939. Today we need another New Deal and a new President with a big and bold vision.
In this situation, a country’s finances can parallel our personal finances. Taking a loan to build an asset is not imprudent, it is an investment. Taking a loan to consume the funds leads to bankruptcy. The New York Times reports that “Federal payments to farmers are projected to hit a record $46 billion this year.” The first stimulus package was a step in the right direction. However, it is not enough for struggling families to weather months of joblessness. An entrepreneur I spoke to said, “I took the loan and invested it in the stock market. Why not? It gives me better returns than keeping my employees on the payroll!” Much of the first stimulus package simply bolstered the return of the stock market, bypassing those who have minimal savings or investments.
Other countries have achieved success with their economic stimulus plans. U.K.’s Coronavirus Job Retention Scheme now covers 9.4 million people, where the government pays up to 80% of the person’s salary, as long as the employer does not lay them off. UK’s Eat Out to Help Out provided discounted meals every Monday, Tuesday and Wednesday in August. Despite having the world’s highest proportion of seniors, Japan has lost only ~1,500 of its roughly 100 million population.
So who can fix this mess?
Firstly, it must be someone who is not afraid to spend on public works. Some areas desperately in need of investment are: Our crumbling energy infrastructure (our nuclear power plants are over 50 years old); need for green renewable energy; technology innovations such as those to safely sterilize the virus residing on products; innovations to make indoor spaces safe from the virus; safe delivery technologies; medical innovations including new gene-modifying medicines; healthcare delivery and technology; reforestation of areas destroyed by wildfires; renewable energy such as wind, wave and geo-thermal technologies.
Vice President Joe Biden’s Plan includes creating a Public Health Jobs Corps, to tackle the formidable task of managing vaccinations as well as renewable energy, investment in schools and universal broadband.
We need someone who listens to experts. This is not quick Shark Tank decision making, but thoughtful and methodical policy analysis.
We need a leader who can read complex arguments and cut to the heart of the matter.
We need a President who listens, who is willing to listen to the ideas from the other side of the political aisle.
We desperately need someone who cares more about repairing the country’s finances than his own.
When you’re in a hole, you don’t fight with those around you, you partner with them to climb.
By Nev March
Writing as Nev March, author Nawaz Merchant is the recent winner of the Minotaur Books/Mystery Writers of America First Crime Novel Award. She has three degrees in Economics and has worked in business analysis for two decades. A Parsi Zoroastrian immigrant, she teaches Creative Writing at Rutgers-Osher Institute. She is a member of the Mystery Writers of America and the Hunterdon County Library Write-Group. ‘Murder in Old Bombay’ is her debut novel.
