What the Hell Happened to the Tea Party?
I'm old enough to remember the last economic crisis America suffered.
In 2008, I'd just broken into the business as a financial writer and had a front-row seat to the meltdown.
Day in and day out, I reported and analyzed all of the moving parts...
The subprime loans and bad mortgages, the sovereign debt and collateralized debt obligations, car companies that overextended themselves, the banks that bet against their own clients...
All of it.
I also remember the bailouts, like the $787 billion American Recovery Act — and the protests that erupted in its wake.
You remember the Tea Party, too, right?
I'm sure Mark Meadows does. He was a member as a Representative of North Carolina, and the founder of the House Freedom Caucus.
In that capacity, he advocated to cut spending, resist raising the debt ceiling, and spearheaded the charge to shut down the government in 2013.
"President Obama continues to fail to heed the warnings of economists and the desire of the American people to reduce government spending and balance the budget," Meadows said. "With the national debt at over $20 trillion, the consequences of allowing our spending problems to continue to go unresolved are extremely dire."
But that was then; this is now.
Today, Meadows is serving as President Trump's Chief of Staff and was one of the chief architects of the $2 trillion stimulus plan that just sailed through Congress.
That's more than double the size of Obama's package, but if Meadows objected to the price tag, he certainly didn't say so publicly.
But this is different, right?
This is a time of real crisis. This is the time to throw caution to the wind and pull out all the stops.
“As a fiscal conservative, I’ve long been concerned about deficits and debt,” Texas Sen. John Cornyn said. “But I don’t think that’s a discussion we should be having when we are in a national emergency. … We are already on a war footing, and we’ve got to beat this virus.”
Except that doesn't really track either — not when the national debt already totaled $23.5 trillion before the Coronavirus even broke out in China.
And not when the federal deficit grew from $587 billion in FY2016 to more than $1 trillion in FY2020.
Indeed, this new fiscal albatross only came after the government racked up $624.5 billion in red ink in the five months from October to February.
And there's going to be more.
Americans haven't even received their first round of $1,200 stimulus checks and a second round is already being discussed.
“We could very well do a second round,” President Trump said Monday. “It is absolutely under serious consideration.”
Trump is also pushing for a massive infrastructure bill, prompting Democrats to dust off the $760 billion spending package they outlined in January.
Oh yes, you better believe the Democrats are on board.
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“We must double down on the down-payment we made in the CARES Act by passing a CARES 2 package, which will extend and expand this bipartisan legislation to meet the needs of the American people,” says House Speaker Nancy Pelosi.
Make no mistake, we're going to have spent more than $5 trillion on stimulus by the time this is all over.
And while Americans will be more than happy to cash a few extra checks, the overwhelming majority of that money is going to go to businesses and corporations.
Of course, it's going to be hard to know the precise distribution, because earlier this week President Trump fired the guy who was charged with overseeing the $2 trillion pandemic stimulus.
Up until Tuesday, Glenn Fine was the Pentagon’s acting inspector general and head of the Pandemic Response Accountability Committee. The committee was built into the bill to create a watchdog that would submit quarterly reports and notify Congress if any agency refused to comply with its information requests.
It was literally his job to look out for malfeasance and ensure that the stimulus plan wasn't reduced to a slush fund for political allies and corrupt corporations.
But now he's gone.
So, too, is Michael Atkinson — the intelligence community inspector general.
Trump fired him last week for notifying Congress of the whistleblower complaint that ultimately led to his impeachment — something Atkinson was required by law to do.
And this week, in addition to firing Fine, Trump lashed out against Health and Human Services Inspector General Christi Grimm, whose office described widespread testing delays and supply issues at America's hospitals.
Now, Grimm is likely on the chopping block, as well.
To be clear, inspectors general have existed in the military since the country’s founding, but Congress established the position in statute in 1978 in response to Nixon’s abuse of executive power during the Watergate scandal.
But the president clearly has no tolerance for them or the oversight they're obliged to provide.
And yet, Congress continues to proffer up blank checks for the president to disburse.
Trillions of dollars flying out of taxpayer pockets, unchecked by Congressional oversight, and landing God knows where.
It's almost worthy of some kind of movement, some kind of rebellion, some public rebuke of government excess, corruption, and a surefire path to financial ruin...
If only one existed...
Jason Simpkins is Assistant Managing Editor of the Outsider Club and Investment Director of The Wealth Warrior, a financial advisory focused on security companies and defense contractors. For more on Jason, check out his editor's page.
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