Our Next Stimulus Package Needs to Bail Out People, Not Corporations

Americans are losing their jobs and health coverage at higher rates than any other country struck by coronavirus. If you thought that losing your job was bad enough, imagine losing your employer-based health insurance during a global pandemic. The initial Federal relief package, known as the CARES Act, was the government’s first step in trying to ward off economic collapse. However, the relief package was more preoccupied with bailing out big corporations than ensuring that employees stay on the payroll. 

The CARES Act handed more than $450 billion to large industries without clear requirements to protect the jobs of workers. For many large corporations, their first goals are to deliver dividends to their shareholders and to maintain their executive salaries. Keeping their employees safe and paid well is only a secondary concern; and companies like Amazon and Marriott fit this mold nicely. This is unacceptable, especially when losing health insurance during a deadly pandemic places lives in jeopardy. This is why I propose that our next relief package is focused on workers and everyday people by including three key provisions.

First, we need a Covidcare for All to guarantee free Covid-19 care to everyone, regardless of their immigration status. As a nation fighting a highly contagious virus, we are only as healthy as the most vulnerable among us. Now is not the time to draw distinctions over who is “worthy” to receive care. This provision should increase access to testing and waive all Covid-19 costs for co-pays, premiums, and deductibles.

Second, the next relief package needs to take aggressive steps to ensure that people don’t lose their jobs due to Covid-19. The road to economic recovery will be much longer if the relationships between workers and employers are severed because firms cannot maintain their payrolls. The federal government can intervene by acting as the “payer of last resort” for all business expenses. These expenses include the salaries of idle workers, rent, utilities, and insurance premiums. By covering these necessary expenses, this policy allows business to avert massive layoffs or bankruptcy during the crisis which will ensure a speedier economic recovery.

However, federal funds for business expenses should come with requirements designed to protect the welfare of workers. Businesses that receive funds must institute a $15 minimum wage, offer paid sick leave and personal protective equipment to employees, and adopt a “ban the box” hiring policy to lower the employment barrier for those with criminal records. Large firms should be required to follow a co-determination model where workers are given voting positions on corporate boards. This model is fully operative in Germany, one of the most successful economies in the world. But how much representation should workers have? Elizabeth Warren has proposed that workers compose 20% of corporate boards while Bernie Sanders proposed 45%. The next relief package should not settle for anything less than a majority worker representation. If there was ever a time to democratize corporate America, it’s now. 

Third, lower and middle class individuals should receive a monthly $2,000 check with an additional $500 for every child. This proposal was recently introduced in Congress and would allocate monthly payments for up to 12 months during the crisis. The one-time $1,200 check from the first relief package was a good start, but it’s not enough for ordinary people to pay for necessary expenses for the duration of the crisis.

So, how do we pay for it? The relief package should primarily be financed by public debt, same as the CARES Act. While some economists argue that deficit spending risks inflation, there is mounting support for the idea that the governments should and can do more deficit spending, especially in times of economic crisis. If the U.S. deficit has been able to handle the tax cuts and massive military spending of Trump and previous administrations, then there is certainly a case to fight a pandemic under the same approach. 

Another revenue source should come from an excess profits tax. No one should profit off of a deadly pandemic. It is unacceptable that companies like Facebook, Amazon, and Netflix enjoy surges in their company stock while other businesses suffer and the federal government shells out trillions of dollars in relief. Invoked during World War II and the Korean War, an excess profits tax would redirect those corporate profits into a pro-worker federal relief package.

The U.S. doesn’t have to be the country that values corporate profits over the lives of people. We need a federal relief package that provides free treatment for the virus, prevents layoffs, ensures the safety of workers, and provides the resources necessary for people to pay their monthly bills. This kind of relief will not only save lives and lead to a quicker economic recovery, but it will show our commitment as a country to doing what is right.