Getting America Back to Work
Most people seem to agree that a federal government–managed response is appropriate in a national crisis such as the current pandemic, particularly when economic stress is the direct result of government action, such as its recent economic shut-down. But when this crisis ends, will we return to the freest economy in decades, the thriving private sector that, over the past three years, created jobs and rising wages across all income groups? Will we restore the labor market strength that carried with it a belief that the future held even greater promise than the past?
Or, will we move to a government-dominated economy that discourages individual initiative and dampens ingenuity? Where people succeed not by meeting the needs of others (consumers) but rather by meeting the demands of elites who distribute government largesse to those they deem worthy.
In other words, will we return to the economic stagnation that became the Obama era’s “new normal” or the prosperity we came to expect under President Trump?
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which Congress enacted to address the coronavirus economic shutdown, contemplates a return to the vibrant and dynamic economy of the last three years once the crisis ends. The government programs it created to assist individuals and businesses have expiration dates or dollar caps. The checks to individuals are a one-time benefit. The increased unemployment benefits expire in four months. The Small Business Administration’s (SBA) small business loans program has a $350 billion cap (recently increased by an additional $310 billion). Various other provisions have similar end dates and monetary caps. It is crucial that any further programs Congress passes to address the crisis similarly have expiration dates or monetary caps tied to the end of the crisis.
In a post-pandemic world, we will need to address the implications of the massive increase to our federal debt caused not just by the pandemic response but by the decades of deficit spending that preceded it. Republicans and Democrats would do the country a tremendous service if, at long last, they entered into meaningful discussions about reducing federal spending and increasing government revenue without growth hobbling taxes. In fact, even the prospect of a bipartisan consensus on reducing the deficit would have a beneficial effect on the economy as it recovers from the pandemic.
Otherwise, the prescription for economic growth is clear. Three simple words hold the key to restoring prosperity as quickly as it tanked in weeks following the economic shutdown, for creating millions of jobs, for reviving the careers that have been interrupted, for better wages for workers, for more money for education at all levels, for creating wealth that our charities and non-profits need, for stock market recovery so that our retirees are protected, and for surging the revenue of state and local governments:
Let capitalism work.
When this crisis ends, all we need to do to restart our economy is return to what produced the Trump boom in the first place—regulatory relief, certainty, and tax policies that allow individuals and businesses to keep most of what they earn. Let the free markets perform their magic. Let the dynamic energy of CEOs and line workers, professionals and technicians, entrepreneurs and accountants, restore the rising tide that was lifting all boats before the virus hit. The economy will rebound with astounding speed if—and only if—we put our faith in the vast potential of enterprising individuals in a free market economy. That will require ending much of what the government is doing to address the Coronavirus crisis and resisting the inevitable urge for government to keep doing more after the crisis abates.
I have no doubt that this will be the policy of the Trump Administration and Congressional Republicans. They created the boom of the last three years; they understand that while government has a vital role to play in helping the disadvantaged, it must allow the free market to work in generating the wealth that both the private and public sector need.
The question is this: What will the Democrats do? What about Joe Biden, Nancy Pelosi, and Chuck Schumer? Hopefully, they can resist progressive zealots like Bernie Sanders, Alexandria Ocasio-Cortez and Ilhan Omar: the people who, despite overwhelming and incontrovertible evidence to the contrary, still believe socialism works; the people who think Venezuela is a model; the people who seem completely oblivious to the economic experience of the last 100 years.
But, the signs aren’t good.
When we emerge from this crisis, Progressives will doubtless argue that the government-directed virus-management model worked so well, that it must surely work in other areas such as health care, education, housing, or to save the environment. In fact, even before this crisis began the Progressives’ agenda included a massive and unfathomably expensive government takeover of the economy known as the Green New Deal. Bernie Sanders and Joe Biden both support it. Standing alone, the Green New Deal has the potential to expand the federal government beyond anything we have ever experienced, granting it power to control critical economic sectors such as energy, healthcare, construction, housing, and transportation.
This government proliferation would require an expansive federal bureaucracy—well beyond even the Obama model— empowered through legislation and regulation and supported by unprecedented, growth-killing taxation. Bureaucrats would set economic goals discouraging both innovation and investment and rewarding only those who supported progressive policy goals. It would all but eliminate consumer choice, the free market force that drives competition and produces the prosperity and abundance that are the hallmarks of capitalism.
To be clear, this is not to say that all legislation or regulation intended to legitimately protect the environment—the water we drink and the air we breathe—is inherently wrong. Nor is there anything wrong with efforts to reduce the amount of carbon we pour into the atmosphere, through increased use of nuclear energy, natural gas or renewables when economically feasible.
But the manipulation of those goals to advance a collectivist agenda and replace our capitalist free market economy with a socialist economy, democratic or otherwise, is objectionable. To use the current crisis—a pandemic, nonetheless—as the vehicle to advance those goals is nothing short of despicable.
Andrew F. Puzder is the former CEO of CKE Restaurants, Inc. He is the author of Getting America Back to Work, a new Broadside from Encounter Books.