This has been a wild year.
For me, my family moved last year from our beloved Texas to Virginia for my job with the extraordinary folks at the White House.
While there, I helped write the president’s budget that found taxpayer savings of a record $4.6 trillion over a decade, made permanent the Trump tax cuts, noted the need for a fiscal rule, highlighted the coming generational storm of debt, and made eliminating wasteful spending a top priority.
I helped craft the economic assumptions in the budget with 3% growth for years that balanced the budget over time if Congress simply followed the pro-growth vision of tax cuts, deregulation, energy independence, and improved trade deals that had already worked so well.
We had the pesky impeachment process that kept things extra busy around the office, but that failed political attempt was soon over with but a whimper.Then there were rumblings about COVID-19 that started in China. The virus spread globally. And soon was infecting Americans.
I subsequently found myself in the Situation Room for meetings regarding economic issues and was constantly reviewing the financial, economic, and health data to find trends, evidence, and indicators of the next step to address the spread.
There was a presidential declaration of a national emergency and White House guidance on how to safely practice social distancing to flatten the infection curve to not overwhelm hospitals.
It’s important to note that the White House didn’t shut down anything. State and local governments made those calls. And later, when the White House released its suggestions on how to safely end the shutdowns, federalism rightfully played a key role.
For someone from Houston, Texas (and a rock drummer as a young adult), this year was a whirlwind.
Leaving McLean, Virginia heading to Texas, I noticed few cars on the road and practically everyone wearing masks. We stopped in Nashville, Tennessee for a night, where they had more activity but still many people had masks. Our next stop was in Oklahoma City, Oklahoma where for the most part you couldn’t tell things had been shut down. And then we drove to Round Rock, which is just north of Austin, and there was lots more activity and some people wearing masks.
It felt like time travel—from a less prosperous past, with less freedom, to a better time with more prosperity for all.
While all 50 states have announced some form of a phased end to their shutdown, what we’ve generally seen is that Republican-dominated states like Texas, are moving forward much faster than Democrat-dominated states like Virginia. This means there will be less economic activity and larger fiscal problems in many blue states compared with red states.
And this will result in less hope for millions of people who are looking forward to getting back to work or finding a new job, reopening their business, and leaving a legacy. Moreover, the economic gains and declining inequality during the blue collar boom of the first three years of the Trump administration will likely be shattered as state and local leaders keep some form of lockdowns in place.
The more than $9 trillion of taxpayer money, which is half of the private sector’s annual output, authorized by Congress and making its way through either government coffers at every level or being leveraged by the Federal Reserve will be the largest redistribution of funds ever.
This unfair redistribution will be even worse if Congress chooses to bailout states (even more than it already has). Yet blue states are calling for such bailouts to deliver them from years of fiscal mismanagement and longer shutdowns. This will mean further increasing the national debt above total economic output and further increasing unfunded liabilities of “entitlement” programs of at least $100 trillion. Clearly, nothing is free as we will be paying for this now, our children will later, and so on at this pace.
Congress should just say no to bailouts, and instead have governors do like Gov. Abbott (R-TX) did and ask agencies to cut their budgets (just as families are having to do).
What a year it has been. Just the last couple of months have felt much longer. But we’re America, and we will once again be the beacon of hope for people across the globe. What we need is our God-given freedoms. The government’s role is not to save us; its role is simply to ensure those freedoms.
Don’t let this Great Disruption crush the hopes and dreams of millions of more Americans. Let’s end the shutdowns so people can control their destiny once more and reach the historic prosperity we had just a few months ago.
Vance Ginn, Ph.D.