CDN/US Covid-related political discussion

[FJAG]

Sigh.

:waiting:

 

[suffolkowner]

While various types of deck chair are being re-arranged here and there, the Titanic is in peril....



Liberals' fiscal snapshot predicts $343B deficit as Morneau offers little intention to curb spending

The federal government expects to post a $343-billion deficit in 2021 as COVID-19 spending continues to mount, outpacing earlier estimates and reinforcing the depths of Ottawa’s weakened fiscal position.

In his fiscal update on Wednesday, Finance Minister Bill Morneau indicated that total government spending would balloon to $612 billion by 2021, nearly double the $346 billion spent in 2019. The swollen deficit is largely a result of higher projected spending under Ottawa’s two key COVID-19 financial aid programs, the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Response Benefit (CERB), which have been repeatedly extended and expanded in recent months.

The update on Wednesday underscores the fiscal bloodbath that Morneau finds himself in as he seeks to guide the Canadian economy out of its steepest decline in decades.

Opposition parties and industry groups have been pressuring the Liberal government to provide some indication as to when it will begin to rein in its spending programs, warning that indiscriminate spending could begin to weigh on an eventual economic recovery.

https://ottawacitizen.com/news/politics/liberals-fiscal-snapshot-predicts-343-billion-deficit-as-bill-morneau-offers-little-intention-to-curb-spending/wcm/5ad46fa2-83c9-497c-ad00-724bed2c9774/

I'd like to see some comparables with other countries. Add in the provinces and the economic situation in municipalities as well. It is interesting that the unemployment numbers are estimated at 5.5 million but the CERB was 8.16 million the CEWS topped out at 2.7 million and CESB at 600,000 that's probably half the employed population

 

[Altair]

Well, the UK is running a deficit somewhere around 300 billion pounds, (511billion CAD)

France is around 315 billion Euros(11.4 percent of GDP, and around 483 billion CAD)

And you have the Americans running 2.7 trillion for the first 9 months of fiscal year 2020,(3.6 trillion CAD)

Everyone is in the same boat, with a lot of countries going above 100 percent of GDP in debt loads.

 

[daftandbarmy]

I'd like to see some comparables with other countries. Add in the provinces and the economic situation in municipalities as well. It is interesting that the unemployment numbers are estimated at 5.5 million but the CERB was 8.16 million the CEWS topped out at 2.7 million and CESB at 600,000 that's probably half the employed population

I'd like to see something like responsible fiscal leadership. You know, kind of like:

"Here are our predictions in Case A, B, and C. Here are some actions we think we can take in each case."

'Opening the wallet wider' is how my kids think about responding to financial need.

 

[QV]

I'd like to see some comparables with other countries. Add in the provinces and the economic situation in municipalities as well. It is interesting that the unemployment numbers are estimated at 5.5 million but the CERB was 8.16 million the CEWS topped out at 2.7 million and CESB at 600,000 that's probably half the employed population

It makes me wonder if the unemployment is far higher than reported.  If so, we are in big trouble if those jobs don't come back.

 

[Halifax Tar]

While various types of deck chair are being re-arranged here and there, the Titanic is in peril....



Liberals' fiscal snapshot predicts $343B deficit as Morneau offers little intention to curb spending

The federal government expects to post a $343-billion deficit in 2021 as COVID-19 spending continues to mount, outpacing earlier estimates and reinforcing the depths of Ottawa’s weakened fiscal position.

In his fiscal update on Wednesday, Finance Minister Bill Morneau indicated that total government spending would balloon to $612 billion by 2021, nearly double the $346 billion spent in 2019. The swollen deficit is largely a result of higher projected spending under Ottawa’s two key COVID-19 financial aid programs, the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Response Benefit (CERB), which have been repeatedly extended and expanded in recent months.

The update on Wednesday underscores the fiscal bloodbath that Morneau finds himself in as he seeks to guide the Canadian economy out of its steepest decline in decades.

Opposition parties and industry groups have been pressuring the Liberal government to provide some indication as to when it will begin to rein in its spending programs, warning that indiscriminate spending could begin to weigh on an eventual economic recovery.

https://ottawacitizen.com/news/politics/liberals-fiscal-snapshot-predicts-343-billion-deficit-as-bill-morneau-offers-little-intention-to-curb-spending/wcm/5ad46fa2-83c9-497c-ad00-724bed2c9774/

This is the perfect play though.  Get the population addicted to uninhibited spending and free money and then call the fiscally responsible the devil; eh voila you have the key to winning Canadian hearts and minds in the 21st century.

 

[QV]

This is the perfect play though.  Get the population addicted to uninhibited spending and free money and then call the fiscally responsible the devil; eh voila you have the key to winning Canadian hearts and minds in the 21st century.

I think you're right on that, but for how long can this go on before the bottom drops out?

 

[YZT580]

I think you're right on that, but for how long can this go on before the bottom drops out?

for Trudeau et al the only thing that counts is the next election

 

[brihard]

for Trudeau et al literally every elected politician the only thing that counts is the next election

FTFY.

It's why we see so much noise being made about what's been done poorly, with very little being said about 'here's what we would have done instead, and here's our analysis of why it would work'. This is free fodder for the opposition, and they don't have to contend with the burden of proposing a viable alternative, since this crisis isn't on their watch.

 

[Brad Sallows]

>Get the population addicted to uninhibited spending and free money

Right now the velocity of money is atypically slow, so increasing the money supplies in countries hasn't had the usual expected effect (price inflation).  When that happens, people are going to realize that the values of their pay and pensions aren't what they used to be.

 

[suffolkowner]

It makes me wonder if the unemployment is far higher than reported.  If so, we are in big trouble if those jobs don't come back.

In the past unemployment numbers were arrived at through surveys and to be taken with a grain of salt, I assume they are the same today. I'm guessing that actual unemployment is higher than stated but that there may be some people that are collecting CERB in error

 

[GAP]

Heard on the news last night that in Nunavut 30% of people are collecting CERB, and 10,000 of a population of 20,000 in NWT are collecting CERB. The major employer is the Federal Government who has not laid anyone off.

 

[Altair]

I think you're right on that, but for how long can this go on before the bottom drops out?

with interest rates so low, (for now) it only costs 1 billion interest to service 100 billion in debt.

3 billion isn't pocket change, but it won't cripple the government.

 

[QV]

>Get the population addicted to uninhibited spending and free money

Right now the velocity of money is atypically slow, so increasing the money supplies in countries hasn't had the usual expected effect (price inflation).  When that happens, people are going to realize that the values of their pay and pensions aren't what they used to be.

What exactly are the conditions for significant inflation to take place?  It seems to me we are on the way there when you consider CERB and other COVID related spending, severe unemployment, reduced tax revenue, fleeing investment, downfall of the resource sector, and keeping what is left of the economy closed or the possibility of a second COVID wave closing everything up again.  When I am out and about it doesn't feel like the economy is at a tipping point, but maybe the CERB and other benefits instituted because of COVID (like deferred mortgage payments) are keeping that illusion going for now.
 

 

[Remius]

I can only speak of my own area, but some small business and large ones can’t get enough people to come back to work.  Demand is high.  I have been able to order in, curb side pick,up etc etc.  Now, haircuts, dentist appts etc have been just reopened.

The economy seems to still be moving.  No real shortages of anything.

One thing I have noticed is how fragile our economy is and how much it relies on us to buying essentially useless things.

 

[OceanBonfire]

Catholic Church lobbied for taxpayer funds, got $1.4B

The U.S. Roman Catholic Church used a special and unprecedented exemption from federal rules to amass at least $1.4 billion in taxpayer-backed coronavirus aid, with many millions going to dioceses that have paid huge settlements or sought bankruptcy protection because of clergy sexual abuse cover-ups.

The church’s haul may have reached -- or even exceeded -- $3.5 billion, making a global religious institution with more than a billion followers among the biggest winners in the U.S. government’s pandemic relief efforts, an Associated Press analysis of federal data released this week found.

Houses of worship and faith-based organizations that promote religious beliefs aren’t usually eligible for money from the U.S. Small Business Administration. But as the economy plummeted and jobless rates soared, Congress let faith groups and other nonprofits tap into the Paycheck Protection Program, a $659 billion fund created to keep Main Street open and Americans employed.

By aggressively promoting the payroll program and marshaling resources to help affiliates navigate its shifting rules, Catholic dioceses, parishes, schools and other ministries have so far received approval for at least 3,500 forgivable loans, AP found.

...


https://apnews.com/dab8261c68c93f24c0bfc1876518b3f6

 

[Brad Sallows]

>What exactly are the conditions for significant inflation to take place?

Conventionally, when the amount of money available to chase goods and services (demand) increases, while the amount of goods and services available (supply) remains the same.

Reluctance to spend (to go out and about) and/or reduced opportunities to spend (imposed restrictions) have the effect of keeping the "amount of money available" down.  Example: we give someone $2,000 and his obligations (rent, utilities) amount to $1,000, so he may still have $1,000 that he doesn't spend because all he wants to do right now is go out to sports bars.

Of course it's more complicated than that.  After pushing so much money out the door, ideally governments would start pulling some of it back in (eg. new or increased taxes) as "velocity" (rate of spending) picks up.  But no government has ever existed capable of managing that in a balanced fashion.  Even if the attempt were made, the taxes would most likely be aimed at high earners/consumers, so we'd get some inflation control of the prices of things high earners like, and rampant inflation of the prices of things low earners like.

 

[Blackadder1916]

Catholic Church lobbied for taxpayer funds, got $1.4B

https://apnews.com/dab8261c68c93f24c0bfc1876518b3f6

Before we nail one faith to the cross (pun intended) for taking advantage of a government program, let's look at a few other stories that expand the tale.

https://www.newsweek.com/religious-organizations-receive-73-billion-ppp-loans-megachurches-amass-millions-1515963

Religious Organizations Receive $7.3 Billion in PPP Loans, Megachurches Amass Millions

Religious organizations across the U.S. have received at least $7.3 billion in federal rescue package loans, with evangelical leaders tied to President Donald Trump and megachurches tied to scandals pulling in some of the largest payouts.

Treasury Department data released Monday shows that religious organizations, ranging from nearly 10,000 Catholic churches to hundreds of Jewish groups, received 88,411 Paycheck Protection Program (PPP) loans since the program began April 3. Several churches affiliated with outspoken Trump supporters and close associates amassed at least $17.3 million in loans intended to help small businesses and nonprofits retain workers.

Included among the top loan recipients is the megachurch of pastor Robert Jeffress, who last year called Trump a Christian "warrior." Another is City of Destiny, the Florida megachurch run until recently by White House spiritual adviser Paula White-Cain.

. . .

https://www.christianitytoday.com/news/2020/july/paycheck-protection-program-loans-christian-churches-minist.html

665K Ministry Jobs Covered by Paycheck Protection Program Funds
At least 11,500 Christian employers accepted $150,000 or more in government stimulus loans.

Well over a half million pastors, church staff members, and ministry employees kept their jobs and continued serving their communities during the pandemic thanks to Paycheck Protection Program (PPP) loans, according to a list released last week.

As part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed in March, the government offered grants to cover payroll costs for employers, including religious organizations, as a way to keep the economy going and reduce layoffs.

It was the first time the US government had offered to cover the salaries of clergy and ministry workers as part of a stimulus. Some critics—including within the church—discouraged Christian organizations from accepting government funds due to concerns over church-state separation, while others saw it as a way churches and charities to continue to meet community needs during the pandemic.

A list released Wednesday by the Small Business Administration (SBA) showed that at least 11,500 Christian organizations took advantage of the opportunity and received loans of $150,000 or more.

The list was culled based on a keyword search of terminology including church, Christian, Catholic, and diocese, so the totals do not include ministries without Christian wording in their names or those that received smaller loans. More than 80 percent of the 5 million US employers that were granted PPP loans took in less than $150,000, according to the Associated Press, and weren’t included in the recent data.

. . .

https://www.reuters.com/article/us-health-coronavirus-ppp-religious/televangelists-megachurches-tied-to-trump-approved-for-millions-in-pandemic-aid-idUSKBN2480CB

Televangelists, megachurches tied to Trump approved for millions in pandemic aid

WASHINGTON (Reuters) - Megachurches and other religious organizations with ties to vocal supporters of U.S. President Donald Trump were approved for millions of dollars in forgivable loans from a taxpayer-funded pandemic aid bailout, according to long-awaited government data released this week.

Among those approved for loans through the massive government relief program were a Dallas megachurch whose pastor has been an outspoken ally of the president; a Florida church tied to Trump spiritual adviser and “prosperity gospel” leader Paula White; and a Christian-focused nonprofit where Jay Sekulow, the lawyer who defended the president during his impeachment, is chief counsel.

Evangelical Christians played a key role in Trump’s victory in the 2016 presidential election and have remained a largely unwavering contingent of his base.

Vice President Mike Pence spoke at a rally last month at the First Baptist Church of Dallas, whose pastor, Robert Jeffress, has been on Trump’s evangelical advisory board. The church was approved for a $2-5 million loan, the data showed.

Launched on April 3, the Paycheck Protection Program (PPP) allows small businesses, nonprofits and individuals hurt by the pandemic to apply for forgivable government-backed loans. Some say allowing religious institutions to qualify for loan forgiveness highlights a breakdown in the American tradition of a strict separation of church and state.

“The notion of separation of church and state is dead, and the PPP loan program is the evidence of that,” said Micah Schwartzman, a professor at the University of Virginia School of Law. “The money is going to fund core activities of many organizations, including religious organizations. That’s something we’ve not seen before.”

It's not just the "mackerel snappers" using a government collection plate.

 

[daftandbarmy]

Meanwhile, on 'I've been Caught in a Conflict of Interest so I'll throw the Bureaucracy Under the Bus' Hill:

Trudeau admits he did not recuse himself from decision to outsource $900 million volunteer grant program to WE Charity

When asked if he recused himself from those discussions and the final decision, the prime minister responded: “I did not.”

Since the WE Charity controversy began nearly two weeks ago, Trudeau’s office had refused to detail his involvement in the outsourcing process.

Instead, he’s repeatedly said that civil servants made the decision to hire the Toronto-based organization to administer the Canada Student Service Grant (CSSG). WE Charity was to be paid at least $19 million.

https://nationalpost.com/news/politics/justin-trudeau-we-charity-recuse

 

[Jarnhamar]

Bill Morneau has family ties to WE Charity, did not steer clear of cabinet discussion of contract
https://www.cbc.ca/news/politics/we-charity-contract-morneau-1.5644839


Covid19 is turning out to be pretty beneficial to Team Trudeau. Might explain why we didn't act sooner.