Congress can be forgiven for the many flaws in the $2.2 trillion COVID-19 rescue plan it rushed through last month — but only if it fixes them quickly now.
Back then, it was vital to pass something fast, so errors were likely. Among the biggest goofs: OK’ing a $600 bonus on top of state benefits for pink-slipped workers — which made it possible to collect more (up to $1,100 a week in New York) by staying at home than some earned on the job.
No wonder many now refuse to return to work, as The Post’s Lisa Fickenscher reports this week. Meagan Beatty, who’s trying to reopen her Scranton, Pa., business, says workers ask why they should come back and be paid less than they’re getting at home. Matthew Tully’s firm faces a similar dilemma: It’s hard “competing with the federal government,” he snarks.
A government-sparked labor shortage will make it tough for companies to deliver services — key to the post-crisis recovery. It’ll also mean small businesses won’t get to have their Paycheck Protection Program loans forgiven, since the program only allows that if the money is spent on workers.
Plus, when laid-off employees milk jobless benefits, they drain state unemployment trusts faster. Already, nearly half of all states have seen huge dips in reserves since February, the Wall Street Journal reports. Many pray for another federal bailout: New York has run through half its cash and wants a $4 billion federal loan. Massachusetts spent nearly 60 percent of its funds.
Meanwhile, small businesses seeking loans from the $349 billion PPP are coming up dry because the program quickly ran out of cash and Democrats have been blocking new funds, though it looks like they’ve finally agreed to release $250 billion more.
In sum, it’s a mess for businesses, the economy and taxpayers to boot. Notably, The Post warned at the time about the perverse incentive for jobless workers, which Dems insisted on. We’ve also backed more funding for the PPP and various fixes to it.
The sooner all these ills are addressed, the less damage they’ll do.