About six weeks ago, you could have made a reasonable case that Mitch McConnell was right about the stimulus. Unemployment had fallen below 7 percent, and the economy was clearly recovering. Another large bill was unnecessary.
Today, with the virus spreading throughout the country (no geographic areas excluded) and grim winter lockdowns looming, the situation is different. We are clearly looking at six months or more of unusually high unemployment and slow recovery. The vaccine will ultimately put an end to this situation, but for now, help is definitely needed.
There is no dispute at this point about assistance for crippled small businesses and a reasonable level of federal help for the unemployed. A general stimulus payment would probably just be saved, and would be wasteful, as the national savings rate is already unusually high. The remaining issues involve state and local government assistance and liability protection for businesses.
As to the latter, I have no great philosophical objection; it depends on how the language is written. If the idea is just to give capital another cudgel against labor, I’m opposed. As to state and local government assistance, history tells us that it is one of the most cost-effective forms of stimulus imaginable; it maintains essential services in both red and blue states, while preventing inevitable salary cuts and layoffs that will dampen the recovery.
McConnell needs to get over his phobia about helping blue states–the ones that subsidize his state every day–immediately. Perhaps a little prodding from red state governors who are going to feel the economic and political pain of service cuts and layoffs would help.