Toomey blasts $3T relief bill
In a “teletown hall” Wednesday, U.S. Sen. Pat Toomey, R-Pa., lambasted the $3 trillion coronavirus relief bill recently passed by the House and now in the Senate.
“I have all kinds of problems with launching new legislation to spend who knows how many hundreds of billions of dollars more — to shovel (it) out to states, including many that are wildly irresponsible,” Toomey said on a conference call set up by the Pennsylvania chapter of Americans For Prosperity, a libertarian/conservative advocacy group founded in 2004 by the Koch brothers.
One of those problems is the “moral hazard” of giving “bailout” money to states like New York, whose government spends $14,000 per capita, which contrasts to the $7,000 spent by Georgia, Toomey said.
Forcing “more responsible” states to pay for those with “big, bloated bureaucracies” or insolvent pension funds gives implicit permission for those irresponsible states to continue their spendthrift ways, Toomey said.
“It’s maddening,” said AFP President Tim Phillips.
The people of the spendthrift states have chosen the kind of policies they prefer, so “why should (the federal government) come in and bulldoze all that?” Toomey asked.
Moreover, the federal government has already given states $250 billion to cover coronavirus-related expenses and shortfalls with Medicaid, education, transportation and public health, covering 70 percent of losses, Toomey said.
“Shouldn’t the states contribute?” he asked. “They have taxing authority.”
It’s true that it’s easier for the federal government to borrow and print money, “but that’s no free lunch,” he said.
The overall cost of the House proposal, engineered by Democratic Speaker Nancy Pelosi, is “staggering,” Toomey said.
The federal government has already passed $6 trillion in total coronavirus aid — although $3 trillion of that is in loans, he said.
That $6 trillion is equivalent to 30 percent of the entire economic output of the U.S., he said.
It’s created debt at dangerous levels and that will grow more dangerous when interest rates rise to more normal levels, Toomey said.
“We’ve already dug ourselves a big hole,” he said. “Maybe it’s time to slow down the digging.”
Tomey said, “Government spending is no a substitute for an economy.”
While spending another $3 trillion isn’t the right way, there are legislative needs, Toomey said.
Those include liability protection from coronavirus lawsuits for businesses that follow proper mitigation guidelines, making temporary “pro-growth” tax policies permanent and temporary relaxing licensing and accreditation requirements, he said.
Pressure on states that are holding back on reopening their economies would also help, he said.
Despite his concerns, Toomey is optimistic for a quick recovery, not least because just three months ago, the economy was booming and because people know more about how to deal with the coronavirus.
“It will take awhile to recapture all that we lost,” he said. “But we’ll get there and come out strong.”