Speaker of the House Nancy Pelosi (D-CA) has produced her own coronavirus stimulus plan that is loaded with items not related to the economic displacement caused by the virus. While the Senate is negotiating a deal, the House thought it wise to load up a bill with the wish list of the left in an attempt to use the crisis to leverage progressive policy changes.
Rachel Bovard, senior director of policy for the Conservative Partnership Institute, found a number of provisions in the Pelosi bill that have zero to do with the coronavirus response. Some of the most ridiculous provisions include a bailout of the U.S. Postal Service, forcing states to allow early voting, forcing the airlines to offset carbon emissions, and implementing changes to community newspaper plans. There is a provision that forces a corporation that receives financial aid to “maintain officials and budget dedicated to diversity and inclusion initiatives for no less than 5 years after disbursement of funds.” This is a socialist wish list of bailouts and new government mandates that will not help those in need to get tested for the coronavirus nor will it help with the economic displacement caused by the virus.
One member of ‘The Squad’ wants to use the Pelosi produced ‘stimulus’ bill to eliminate banks. Rep. Rashida Tlaib (D-MI), one of the leaders of the Democratic Socialists in the House, wants Pelosi to insert legislation into the stimulus to damage America’s banking system. Tlaib’s bill, the Automatic BOOST to the Communities Act, would provide a pre-loaded $2,000 government issued debit card to every person in America with a new $1,000 deposit every month until a year after the passing of the coronavirus crisis.
The Rep. Tlaib idea forwards two goals of the socialist left – eliminating banks and establishing a Universal Basic Welfare payment to all people residing in the U.S.
The way The Squad eliminates banks is to administer this program using the U.S. Treasury’s Bureau of Fiscal Service and not the established banks. The Squad is opposed to the idea of direct depositing money from the federal government into American’s banks. They want to use this crisis to destroy our banking system by setting up an alternative, government run, banking system. Having money flow outside the banks will hurt the banks.
The new banking instrument they want to create would be called a “Digital Cash Card” and would use the existing banking system to withdraw cash and to make payments in a way that will sideline traditional banking. Using this card to pull cash out of the banking system will drain banks of liquidity and lower the amount of cash that banks can lend out and use for other financial instruments. It is pure socialism to want to nationalize banks and this bill provides a back door to eliminating the banking system as we know it.
This idea is consistent with socialism, because the idea would create a government entity to drive elements of the private, productive, sector of the economy out of business. An alternative banking system run by the government would be impossible to compete with. Instead of bank executives making decisions based on profit and loss, we would have unelected bureaucrats making decisions with regard to these new Digital Cash Cards. A government that can print money, or create new ‘digital cash,’ can easily beat a private sector bank that relies on the government for deposit insurance and the money supply.
The other offensive aspect of this idea is that it is using the coronavirus panic to sneak into place the idea of a Universal Basic Income (UBI). Andrew Yang called it the “Freedom Dividend,” and it was an attempt to make the government a source of income for all Americans. It is based on a flawed theory that if you dump enough cash into the hands of people, they will spend it and it will magically expand the economy. It ignores the dramatic impact on government spending and the fact that the money will come from somewhere.
Money will have to be borrowed to pay for this trillion-dollar program and that will drain resources from the productive sector. As a bonus, this idea deters people from working, because they will get paid by the government no matter what they do. Unlike ideas like suspending the payroll tax that incentivizes people to work more hours, the Squad’s idea will motivate people to spend more time not working.
The Rep. Tlaib provision being pushed to be included into the stimulus is likely not going anywhere, but it does show that the left is not afraid to use a crisis to push socialist ideas.