If the ‘Phants Can’t Kill the Stimulus Package

They will do their level best to ensure that whatever passes is so broken as to be useless.

Case in poiny, Mitch McConnell is suggesting that instead of revenue sharing grants to the states, that they be loans:

But back to my original point: This idea was tried once before, in the depths of the Depression. In 1932, Congress appropriated $300 million to the Reconstruction Finance Corporation to send to the states for unemployment relief. (Unemployment insurance did not exist until the Social Security Act of 1935 was passed). Unfortunately, Herbert Hoover’s RFC didn’t offer the funds to the states as grants but as loans. Already all-but-insolvent, many states didn’t take the offer. And the economy continued its plunge into the abyss.

This is Mitch McConnell’s idea of a policy worth reviving.

I would note that for a non trivial number of states, I think that it’s around 15, this loan would not allow them to prevent draconian cuts in services, because they are not permitted to take out loans for operating expenses, only for capital investments.

These folks are not concerned that a stimulus package will not work, they are concerned that it will work, because if government works, then they are fracked politically.

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