Unusually, our small restaurant owner has the sympathy of members of both parties. Can he count on effective help from either one?
The GOP will offer him the usual cocktail of tax cuts and deregulation. The root of his problem, however, is public confidence in the health care system; the GOP formula isn’t responsive to that. The elimination of health and safety regulations is the last thing he wants right now. He doesn’t need faster depreciation (he already has all of the equipment he needs), capital gains are irrelevant to him, and income tax cuts don’t help when you’re not making any money. A payroll tax cut would reduce his expenses somewhat, but it won’t cause him to rehire employees he doesn’t need, and blowing a hole in the finances of the safety net is not sustainable for any length of time. The GOP approach, in short, won’t keep him in business indefinitely.
What about the Democrats? They have no issue with direct subsidies to worthy businesses, which is what he really needs. Unfortunately, his restaurant is not a public utility, and it isn’t too big to fail. There are tens of thousands of restaurants just like his, many of which would go out of business even under normal circumstances; can the government really distinguish between his successful operation and countless others that look, on paper, just like it? Probably not, so it is unlikely it will try.
There is no good answer to this problem. If he can’t adjust on his own, he’s probably going to go under. That’s the harsh reality of the situation. The good news, to the extent that there is any, is that there will be plenty of people to pick up the pieces when public confidence improves. When will that happen? When we have a vaccine, or a much more rigorous regime of testing and isolation than is contemplated today.