I got the opportunity to hear Esther George (KC Federal Reserve President) speak and present on the state of the economy. By the way, if you ever have a chance to hear her speak, do it. She's as sharp as they come and for an economist, can speak incredibly plainly in ways just about anyone will understand.
Anyway, a couple stats she gave:
1) The household savings rate (rate at which households are saving money) rose 37%!!!!! in 2020. That implies most households are financially better off now, than they were the previous year.
2) When accounting for "transfer payments" (govt stimulus checks, unemployment benefits, etc), the average household income in the US actually rose in 2020. It didn't go down.
3) Given the above, any additional stimulus provided to the economy in the form of government assistance (for most people) is not guaranteed to actually be put into the economy in the form of consumption. According to her, for most people, it will likely just sit in their bank account and up their savings.
What amazes me about the "politics" of this economic climate, is that our policy makers have all this data in front of them. Yet, they go on CNN, FoxNews, MSNBC, hold press conferences, whatever spewing this nonsense that huge swaths of our country are in need of additional checks. This pandemic and downturn affected a very specific, and small segment of the population. Instead of finding ways to target relief to those individuals, we have policy makers just wanting to print money and send checks out to anyone and everyone under a certain income threshold.
Biden and the Dems want to spend another $1.9T in "stimulus", which would bring the total bill for the 4 or 5 rounds of stimulus passed to $5T. To send money to people who need it, and an exponentially larger group that doesn't.
I would love for someone to give me a reasoned argument why their actions aren't akin to "buying votes" at this point.
Anyway, a couple stats she gave:
1) The household savings rate (rate at which households are saving money) rose 37%!!!!! in 2020. That implies most households are financially better off now, than they were the previous year.
2) When accounting for "transfer payments" (govt stimulus checks, unemployment benefits, etc), the average household income in the US actually rose in 2020. It didn't go down.
3) Given the above, any additional stimulus provided to the economy in the form of government assistance (for most people) is not guaranteed to actually be put into the economy in the form of consumption. According to her, for most people, it will likely just sit in their bank account and up their savings.
What amazes me about the "politics" of this economic climate, is that our policy makers have all this data in front of them. Yet, they go on CNN, FoxNews, MSNBC, hold press conferences, whatever spewing this nonsense that huge swaths of our country are in need of additional checks. This pandemic and downturn affected a very specific, and small segment of the population. Instead of finding ways to target relief to those individuals, we have policy makers just wanting to print money and send checks out to anyone and everyone under a certain income threshold.
Biden and the Dems want to spend another $1.9T in "stimulus", which would bring the total bill for the 4 or 5 rounds of stimulus passed to $5T. To send money to people who need it, and an exponentially larger group that doesn't.
I would love for someone to give me a reasoned argument why their actions aren't akin to "buying votes" at this point.
