01 April 20
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Robert Reich | How to Prepare for the Trump Recession
Robert Reich, Robert Reich's Website
Reich writes: "The global coronavirus pandemic has put our economy in free-fall."
Even through Donald Trump’s reckless economic policies, like his pointless trade war with China or his deficit-busting tax cuts for his billionaire donors, the economy has somehow managed to keep chugging along — until now.
All of the stock market gains from Trump’s time in office have been wiped out, and over the course of just over one week in March the Dow Jones Industrial Average experienced its five largest drops in history.
Worse than a plummeting stock market, businesses and major industries have been forced to shutter their windows to help combat the rapid spread of the virus, putting hundreds of thousands of workers’ paychecks at risk.
A recession is inevitable at this point. Here are 3 things we can do to prepare.
Number one: We need to reform unemployment insurance so it reflects the needs of today’s economy.
When it was first created in 1935, unemployment insurance was designed to help full-time workers weather downturns until they got their old jobs back. But there are fewer full-time jobs in today’s economy, and fewer people who are laid off get their old jobs back again.
As a result, only 27% of unemployed workers receive benefits today, compared to 49% of workers in the 1950s. We need to expand unemployment coverage so that everyone is protected.
Number two: We need to strengthen Temporary Assistance for Needy Families, also known as public assistance.
Since its creation in 1996, the number of families receiving cash assistance has declined dramatically – and not because they’re doing well. Between 2006 and 2018, just 13% of families were lifted out of poverty, while the number of families receiving public assistance fell by 39%.
Already weak, the program didn’t hold up well during the Great Recession. Funding doesn’t automatically expand during economic downturns – meaning the more families are in need, the less money there is to help them. The program also has strict work requirements, which can’t be fulfilled in a deep recession. Worse yet, many individuals in need have already exhausted their five years of lifetime eligibility for assistance.
We need to reform the public assistance program so that more families in need are eligible. It should be easier to waive the strict work eligibility requirements during the economic downturn, and the lifetime five-year limit should be suspended.
Number three: We need to protect the Supplemental Nutrition Assistance Program, also known as SNAP or food stamps.
Unlike public assistance, SNAP responded well during the Great Recession. Its requirements are designed to expand during economic downturns or recessions.
Waiving work requirements during the Great Recession made thousands of people in need eligible for the program who otherwise wouldn’t have been. Between December 2007 and December 2009, the number of SNAP participants rose by 45%. The program helped keep an estimated 3.8 million families out of poverty in 2009.
But that might not be an option this time around, as SNAP has come under attack from the Trump administration, which is trying to enact a draconian rule change that would kick an estimated 700,000 of our most vulnerable citizens off of the program. Luckily, a judge blocked the rule from going into effect, but the administration is still fighting to enforce it — even in the middle of a global pandemic. We need to make sure SNAP’s flexibility and ability to respond to economic downturns is protected before the next recession hits.
Stronger safety nets are not only good for individuals and families in need. They will also prevent the looming recession from becoming an even deeper and longer economic crisis.
A street in Seoul, South Korea, last week. Initially in short supply, face masks became more widely available after the government purchased a substantial proportion of national production. (photo: Ed Jones/Getty)
How South Korea Solved Its Face Mask Shortage
E. Tammy Kim, The New York Times
Kim writes: "The coronavirus erupted in South Korea in late January, six months into Yoo Yoon-sook's new job."
EXCERPT:
Such was the extent of the “mask crisis” when the central government decided to intervene in production and distribution. At the end of February, it announced that it would purchase 50 percent of KF-94 masks from the nation’s 130 or so manufacturers. The government began to ship these masks, at a discounted price of 1,500 won each (about $1.23), to some 23,000 pharmacies, in cooperation with the Korean Pharmaceutical Association.
Carmen Martinez of Chispa Arizona helps Brian Ramirez with his voter registration form at Maryvale High School in Phoenix on March 5, 2020. (photo: Ross D. Franlklin/Ap)
Coronavirus Cripples Voter Registration Efforts. Millions Could Be Denied.
Alex Seitz-Wald, NBC News
Seitz-Wald writes: "Presidential elections are typically prime time for bringing new people into the political process, but the coronavirus pandemic is making voter registration more difficult than ever, prompting concerns that many young Americans and other nonvoters might miss their chance to get onto the rolls before November."
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A technician testing ventilators at Bloom Energy, a fuel cell company in California that has transitioned to refurbishing ventilators.(photo: Beth Laberge)
Trump Administration Invoked Defense Protection Act All the Time, but Stalled for the Coronavirus
Matt Stieb, New York Magazine
Stieb writes: "One of the many oddities of the president's response to the coronavirus was the reluctance of the 'wartime president' to invoke the Defense Production Act, allowing the administration to prioritize contracts with private manufacturers to quickly produce goods deemed necessary for the national interest."
EXCERPT:
The delay in activating the Korean War-era power is made even more perplexing by a New York Times analysis that found that the Trump administration has used the Defense Production Act reflexively over the past three years to prioritize orders it deemed necessary for national security, from rare earth metals to build lasers to body armor for Border Patrol agents. The Defense Department alone estimates that it uses the law’s powers around 300,000 times every year, while the Department of Homeland Security prioritized 1,000 orders in 2018 for disaster response efforts.
Already, there is one damaging answer explaining Trump’s current reluctance — because the relevant corporations don’t want him to override their business. According to a Times report from last week, “The U.S. Chamber of Commerce and the heads of major corporations have lobbied the administration against using the act. They say the move could prove counterproductive, imposing red tape on companies precisely when they need flexibility to deal with closed borders and shuttered factories.” The argument appealed not only to Trump, but to his braintrust of Jared Kushner and Larry “pretty close to airtight” Kudlow.
In the new Times report, there are more concerning justifications for the delay: Sources close to Trump said he considers the law “anti-American” and that invoking the DPA would “make it clear that the government is in charge.” While it may be too late to distance the coronavirus from his administration’s lackluster response, so far the president’s crunch-time stalling hasn’t negatively impacted his approval rating. Trump’s approval is actually up five points, though that’s a blip compared to other leaders navigating economic and public health crises.
Hospital equipment is seen in an emergency field hospital to aid in the COVID-19 pandemic in Central Park on March 30, 2020 in New York City. (photo: Stephanie Keith/Getty)
There's Never Been a Better Time for Us to End Private Health Insurance Than Right Now
Tim Higginbotham, Jacobin
Excerpt: "The coronavirus crisis will lead to health insurance premium increases by up to 40 percent next year. We can't afford that. Instead of seeing premiums skyrocket or bailing out private health companies, we need to seize this moment to abolish private insurance and create a single, national insurance plan."
he US health care system is going to be overwhelmed by the coronavirus pandemic for months to come. But when the spread of the virus finally does subside, many of its impacts will be here to stay. With millions of Americans likely to need expensive hospital stays this year, our nationwide health care costs are expected to increase by as much as $251 billion, according to a new analysis. As a result, US health insurance premiums could rise by up to 40 percent in 2021, exacerbating a crisis of ever-increasing costs that already leave Americans paying far more for care than the people of any other country.
What this means is that we’re about to hit a fork in the road with the private insurance industry. The coronavirus is shredding insurers’ profits right now, underlining the fact that private insurance is simply not built to handle a medical crisis. Having to cover a surge of expensive treatment — and, in some cases, having to waive co-pays — is antithetical to the premise of for-profit insurance. Saddled with these unexpected costs, private insurers’ only alternative to drastically raising our premiums will be to request a massive government bailout to avoid bankruptcy.
Allowing private companies to bankroll our health care system has always been a terrible policy choice, but the horror of this approach is about to become even more evident. Hiking premiums in the midst of a devastating pandemic to make up for their losses is an act of cruelty, to be sure. But it’s also the only logical act for companies whose sole purpose is to chase accrescent profits.
Instead of allowing our premiums to skyrocket or bailing out a heartless industry with public funds, thereby prolonging a profit-driven nightmare, we need to seize this watershed moment by taking the step many Americans have demanded for over a century. It’s time to abolish the private insurance industry and create a single, national insurance plan in its place.
Now Is the Time
There has never been a more obvious moment to take the leap to single-payer health care. The familiar arguments against it, disingenuous in the first place, are suddenly outwardly ridiculous and easy to refute.
Joe Biden has been using his scarce media appearances to assure viewers that he still opposes Medicare for All, Bernie Sanders’s popular single-payer plan that would comprehensively cover all Americans at no out-of-pocket cost. But his arguments — that Medicare for All would be too expensive, that it would disrupt people’s employer-sponsored coverage, and that it would bring too large a change from the status quo — no longer carry the weight they once did. Even CNN’s Anderson Cooper recently pressed Biden to explain how his health care plan would solve the problems made evident by the current pandemic.
On the question of cost, Sanders and his fellow Medicare for All advocates have long argued that single-payer health care will cost substantially less than our current system. This is backed up by virtually every major economic analysis of his plan, although these studies have long been ignored by Medicare for All’s opponents in Congress and the media. But they become harder to ignore the more expensive the current system gets — and a massive hike in premiums or a major government bailout will only underscore Sanders’s argument further.
As for the criticism that Medicare for All would throw people off their employer-sponsored insurance, it’s a bit more difficult to defend this argument when the country is projected to possibly reach its highest ever levels of unemployment. The major flaw in tethering health care to employment has never been clearer: workers are constantly at risk of losing their employer-sponsored insurance.
Now it’s happening on a mass scale — millions of Americans have already lost their jobs during the pandemic, and it’s only going to get worse.
Liberals have spent the last decade celebrating the fact that the Affordable Care Act lowered the number of uninsured people in the United States from 44 million to a still-astonishing 28 million. Suddenly, that modest improvement is being reversed. Because we’ve relied on a fragile method of coverage instead of a bulletproof approach of automatic, universal enrollment in a public plan, all of the progress made by liberals is subject to erasure by a single crisis.
Perhaps the biggest obstacle to building the public demand for Medicare for All has been the mere fact that it will bring a major disruption to the status quo. The concept of socializing one-sixth of the US economy — which is what Medicare for All entails — has been used to frighten those wary of change.
But the pandemic has already disrupted the status quo. We no longer face a choice between keeping things as they were and implementing a major change. Change is coming, no matter what, and it’s our choice whether we respond to it by using public funds to prop up a broken system that constantly kills and bankrupts Americans in the name of profit, or by using those same funds to create a stable, single-payer program designed in the interest of public health.
Don’t Bail Out an Industry That Shouldn’t Exist
We’ve already tried bailouts. The Affordable Care Act (ACA) was essentially a bailout in that it heavily subsidized insurance companies in order to get them to take measures that otherwise would not be sufficiently profitable. In fact, the government continues to pump hundreds of billions of public dollars each year into the industry to protect its profits.
It’s a broken approach no matter the scale. But what’s coming will be massive — it will make the ACA subsidies look incredibly meager. We cannot allow such a historic bailout of an industry that should not exist in the first place.
The logical fix to the problems of our health care system has always been to implement a single, national insurer. Instead of profit, we need to prioritize public health and well-being. Even when we’re not facing such a monumental crisis, our current system causes millions to suffer, physically and financially.
But this crisis has brought us to a unique crossroads. With our health care providers crying out for the help they need, with millions finding themselves suddenly uninsured, and with the insurance industry proving itself fundamentally incapable of protecting public health, we have the opportunity to choose a better way.
It’s long past time for single-payer health care. We’ve been demanding it for more than a century — people have fought their entire lives and died without ever seeing it become a reality. But we’ve never had a moment quite like this, where the flaws and shortcomings of our long-standing multi-payer system are so abundantly clear.
So let’s make our demand even clearer: instead of bailing out the industry that murders and bankrupts us and our families, let’s erase the industry altogether and take health coverage into public hands through a Medicare for All, single-payer program.
Turkish president Recep Tayyip Erdogan at Huber Palace in Istanbul on March 27. (photo: Turkish Presidential Press Servi)
The Coronavirus Is Exposing the Flaws of Erdogan's Strongman Rule
Asli Aydintasbas, The Washington Post
Aydintasbas writes: "In Turkey, a video of a truck driver went viral this week, as he voiced the feelings of millions of working-class Turkish citizens too poor to observe the government's stay-home advice."
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A wall of plastic trash at Garten Services in Salem, Ore., is headed to the landfill. The vast majority of plastic can't be or won't be recycled. (photo: Laura Sullivan/NPR)
Plastics Industry Spent Millions Selling the Public on Recycling - in an Effort to Sell More Plastic
Laura Sullivan, NPR
Sullivan writes: "For decades, Americans have been sorting their trash believing that most plastic could be recycled. But the truth is, the vast majority of all plastic produced can't be or won't be recycled. In 40 years, less than 10% of plastic has ever been recycled."
EXCERPT:
But the more plastic is recycled, the less money the industry will make selling new plastic. And those profits have become increasingly important. Companies have told shareholders that profits from using oil and gas for transport are expected to decline in coming years with better fuel efficiency and the increasing use of electric cars. Industry analysts expect oil and gas demands from the chemicals industry will surpass the demand from the transport side in the coming decade. Plastic production overall is now expected to triple by 2050, and once again, the industry is spending money on ads and public relations to promote plastic and recycling.
Plastic is now more prevalent than it's ever been and harder to recycle. Gas prices remain at historic lows, making new plastic cheaper than recycled plastic. And the industry now produces many more different — and more complex — kinds of plastics that are more costly to sort and in many cases can't be recycled at all. Efforts to reduce plastic consumption are mounting nationwide, but any plan to slow the growth of plastic will face an industry with billions of dollars of future profits at stake.
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