We Need to Stop Calling it Stimulus
Government will be focused on basic maintenance for months and that’s going to produce profound change.
Stimulus, by definition, is intended to get an economy going again. It puts money in the pockets of people not just to allow them to survive but to spark the consumption that has been central to the growth of the modern global economy for over a century.
It should go without saying that during a crisis on the scale of the coronavirus (COVID-19) pandemic the old rules don’t apply. Even assuming governments were able to completely replace paychecks with aid delivered through benefits like unemployment insurance payments and tax credits, the ability to spend this money at the local mall or use our discretionary income to take a trip is impossible if people are being told to stay home. Even buying more things online only gets you so far when production has been largely halted by a disease.
Of course, our income can’t simply be replaced in its entirety with a regular government check. Furthermore, unlike with past economic recessions and depressions, what we are facing is for all practical purposes an economic shutdown as opposed to a slowdown or prolonged decline in growth. That this shutdown is occurring over weeks as opposed to years and without the benefit of…
