Billions are going to zillionaires under the guise of pandemic relief
While President Trump and his allies in Congress seek to tighten access to food stamps, they are showing compassion for one group: zillionaires. Their economic rescue package quietly allocated $135 billion — yes, that’s “billion” with a “b” — for the likes of wealthy real estate developers.
My Times colleague Jesse Drucker notes that Trump himself, along with his son-in-law, Jared Kushner, may benefit financially from this provision. The fine print was mysteriously slipped into the March economic relief package, even though it has nothing to do with the coronavirus and offers retroactive tax breaks for periods long before Covid-19 arrived.
Senator Sheldon Whitehouse of Rhode Island and Representative Lloyd Doggett of Texas, both Democrats, have asked the Trump administration for any communications that illuminate how this provision sneaked into the 880-page bill. (Officially, the provision is called “Modification of Limitation on Losses for Taxpayers Other Than Corporations,” but that’s camouflage; I prefer to call it the “Zillionaire Giveaway.”)
About 82 percent of the Zillionaire Giveaway goes to those earning more than $1 million a year, according to Congress’s Joint Committee on Taxation. Of those beneficiaries earning more than $1 million annually, the average benefit is $1.6 million.
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In other words, a single mom juggling two jobs gets a maximum $1,200 stimulus check — and then pays taxes so that a real estate mogul can receive $1.6 million. This is dog-eat-dog capitalism for struggling workers, and socialism for the rich.
Many Americans understand that Trump bungled the public health response to the coronavirus, but polls suggest that they don’t appreciate the degree to which Trump and Congress also bungled the economic response — or manipulated it to benefit those who least need help.
The United States simply accepted that the pandemic would cause vast numbers of workers to be laid off — and then it provided unemployment benefits. But Germany, France, Britain, Denmark and other countries took the smarter path of paying companies to keep workers on their payrolls, thus preventing layoffs in the first place. The United States did a little bit of this, but far less than Europe — yet the United States in some cases spent a larger share of G.D.P. on the bailout than Europe did.
So the unemployment rate in Germany and Denmark is forecast to reach about 5 percent while in the United States it may already be about 20 percent, depending on how you count it. [Continue reading…]