Congress Should Streamline Existing COVID-19 Relief, Not Add New Programs
Congress likes to spend money and to create new programs, but when it comes to the coronavirus recovery, lawmakers need to keep it simple. Congress has already authorized more than $3.6 trillion of relief, of which to date only about half has been spent. Simple relief is effective relief. The congressional response should remain targeted at containing the virus and streamlining programs that already exist, rather than creating new complexity. Individuals and employers don’t need a new series of tax credits or grant programs. They need simplicity, clarity, and flexibility. The existing pandemic programs are complicated in how they interact―often pushing in opposite directions―and ambiguous in how they are enforced. To keep people connected to their employers and businesses afloat, Congress created the Paycheck Protection Program, a loan program for small businesses; the Employee Retention Credit, a subsidy to keep more people employed; a paid-leave credit to cover the costs of new mandatory paid sick time; a two-year deferral for employer payroll taxes; and new loans and direct support for large businesses, among others. Each of those programs attempt to keep people employed by offering to businesses incentives tied to keeping up payrolls. However, workers often face different incentives. The expanded unemployment benefits included in the CARES Act make it more profitable not to work than to work for as many as 3 in 4 workers.