We Are the Economy

The CARES Act and Beyond

The coronavirus crisis has now eliminated over 22 million jobs—about the same amount created in the decade since the Great Recession. The CARES Act’s Paycheck Protection Program, meanwhile, is falling behind, running dry, and failing to reach the hardest-hit workers and small businesses—problems one-off stimulus checks and unwieldy loans won’t be able to solve. In a New York Times op-ed, corporate bailout watchdog (and Roosevelt’s new managing director of corporate power) Bharat Ramamurti suggests the path forward: “The Congressional Oversight Commission, which I was appointed to by the Senate minority leader, Chuck Schumer, last week, is the only body that can investigate the decisions made by the Treasury and the Fed without interference from President Trump, who has already tampered with the two other oversight bodies [that] the CARES Act created. The public’s best hope is for Congress to quickly appoint the other four commissioners and let us get to work on the behalf of taxpayers, tracking the more than $2 trillion in lending that is already in the pipeline.” Read more, and listen to Ramamurti’s conversation with Vox’s Matthew Yglesias on the latest episode of The Weeds.

• Loans are not enough: “Both Republicans and Democrats are now recognizing that loans may be insufficient and have called for direct subsidies to small businesses. This public-health crisis can avoid becoming a full-scale economic crisis through smart government action to keep businesses whole,” Roosevelt Fellow Lenore Palladino writes for Barron’s. As Roosevelt President & CEO Felicia Wong tells The Progressive in an interview, Congress can do more: “The federal government can absolutely afford to provide cash backstops . . . to those in need. We can mandate paid sick leave for all workers. We can extend unemployment insurance benefits. We can expand health insurance coverage and put in motion public production of basic medicines. In fact, given the amount of wealth in this country that could be put to better public use, we can’t afford not to do these things.” For Boston Review, Wong explains why wealth taxation is central to creating the new progressive economy we need.
• The crisis ahead: “COVID-19 and the economic collapse it has caused have laid bare how connected our problems are,” Roosevelt Director of Climate Policy Rhiana Gunn-Wright writes for the New York Times’s series on a post-pandemic economy. “Refusing to include measures related to climate and environmental justice in economic stimulus packages related to the coronavirus is not neutral when there is no guarantee of other opportunities to do so later. We need to design the stimulus not only to help the US economy recover but to also become more resilient to the climate crisis, the next multitrillion-dollar crisis headed our way.” Read on.

Rethinking Financial Inclusion

An early lesson from the CARES Act’s stilted stimulus disbursement: Digital access to payment systems should be a public good. In a new paper, Roosevelt Fellow Mehrsa Baradaran explains how historical policy choices created today’s exclusionary financial and credit services—and how we can design a more equal system with democracy and public policy. “Financial exclusion is a result of policy decisions that have centered bank credit as a principal means of access; financial redesign—not new technologies at the margins—can remedy the problem by changing the paradigm,” Baradaran writes. “Like moving from gold to silver, a change in the legal foundations of credit and financial policy can create a more just and equitable economy.” Read the full report, and learn more about how postal banking can boost access in a new blog post from Roosevelt Senior Manager of Media Strategies Ariela Weinberger.

How to Rescue the Economy

“There is a whole lot we need to do to pull our country out of this public health and economic calamity. But if there is one shared understanding I hope we can emerge from this crisis with, it’s this: We are the economy,” Roosevelt Fellow and Groundwork Collaborative Executive Director Michael Linden writes for Buzzfeed. “The economy is not the stock market, or the bottom lines of a handful of massive corporations. The economy is the nurses, grocery store workers, warehouse and construction workers, and so many other workers and families. And when they aren’t prospering, the economy isn’t strong.” For Crooked Media, Linden lists the four keys to a successful coronavirus response for all, and in a Washington Post op-ed, Suzanne Kahn—deputy director of the Great Democracy Initiative and a Roosevelt education expert—explores what Congress can learn from the New Deal. For the blog, Roosevelt Network National Director Katie Kirchner argues that college students and young adults, many of whom were excluded from stimulus funding, need targeted support in future relief efforts.

What We’re Reading

Stacey Abrams on Voting Rights, COVID-19, and Being Vice President – Elle

Millennials Don’t Stand a Chance – The Atlantic

Big Business Pledged Gentler Capitalism. It’s Not Happening in a Pandemic. – New York Times

Why the Fed Was the Part of Government Most Ready for This Crisis – New York Magazine

How We Stopped Villainizing the Social Safety Net – CityLab

11 Concrete Steps the Government Can Take to Avert Economic Disaster – Vox

We Need a Better Balance Between Globalization and Self-Reliance – Joseph Stiglitz for Foreign Policy