Republishing an Early Post to Clarify How Inflation started and Why it is so Pernicious
One Foot in the Gravy
A Billion Here, A Billion There, and Soon You’re Talking about Real Money
Chapter One.
This is the first of a series of articles dissecting the COVID19 Relief Bill, giving my take on who is benefiting and what the impact is on the American taxpayer.
The House of Representatives has forwarded a $1.9 trillion COVID relief package to the Senate, which made some modifications and sent it back. What is included? Nobody knows.
In these articles I go through the bill item by item and identifying provisions with a tenuous – if that – connection to COVID relief, as well as provisions that appear to be favoring specific special interests, or groups that have been shielded from the effects of the virus and the unconstitutional lockdowns placed in effect to deal with them.m
Small Businesses
The Secretary of Agriculture gets a $4B slush fund to purchase food and other agricultural commodities. Ag can use the money to give loans and grants to small-to-medium-sized processing businesses. So, who are those? You would think you could recognize a small business if you see it. According to the Small Business Administration, that is not correct. The definition of a small business is determined first by what it does. To find that you use an NAICS Code. Most small business owners I know don’t have a clue what that is or where to find it.
You find clear guidance (that’s a joke) here, in the Electronic Code of Federal Regulations. If you’re a soybean farmer (Code 111110) you can have up to $1M in annual revenue, unless you’re an oilseed farmer other than a soybean farmer (Code 111120) in which case you can have up to $1M in annual revenue. Since the revenue caps are identical, there’s a combined maximum average number of employees (Code 311124) for both at 1,000. If you divide the revenue by federal minimum wage ($7.25) and you spend no money except for employees you can hire 66 employees. What do the other 934 do? Not the Agriculture Secretary’s problem.
So, a million bucks a year and 1,000 employees sounds big. Hold onto your seat and get ready for a bumpy ride. If your business is Postharvest Crop Activities (except Cotton Ginning) (Code 115114), then you can have $30M in revenue. If your business is cotton ginning, Code 11511) then you’re limited to $12M a year. What’s the difference? Damned if I know, except in my experience cotton ginning takes place in the South, and the remaining Postharvest Crap takes place anywhere it wants. Bet you didn’t think $30M was a small business. But wait, there’s more.
New Housing Builders for Sale (Code 236117) can have $39.5M in sales, but New Housing Builders Not for Sale (Code 236115) is different, and you can have $39.5M in annual revenue. Look into my eyes, question nothing, follow the spiral. This goes on mind-numbingly for pages and pages of tables. Home Centers (Code 444110) can have more than $40M. Various manufacturers can have a varied number of employees, all precisely determined by government experts who may never have known the smell of machine oil in the morning.
Section §121.411 (3) has the inviting title Criminal Penalties.
Ag gets money for supplying food to restaurants (if there are any left) and for supply chain resiliency spending, of course. It gets to use the money for Crop Year 2020 losses due to high winds or derechos. It turns out Michael Crichton was wrong. Aliens don’t cause global warming. Pandemics apparently do.
Extra Money for People who support Democrats
We aren’t quite done with the important stuff. It turns out that the federal government, which employs a total of 9.1M people in various categories, has identified a particularly hard-hit segment of those: the 2.1M who are federal civilian direct employees and thus eligible to join unions. These sorely-oppressed and overworked (and immune from firing) employees are awarded a pandemic-fighting fifteen weeks of paid leave to quarantine, recover from illness and care for sick family members or children who are learning from home. Another automatically presumes frontline federal employees contracted COVID-19 at work, meaning those employees will be eligible for certain workers compensation benefits through the Labor Department. The provision doesn’t cover any federal employee who has been teleworking.
Unlike common citizens denied paychecks for a year, these heroes have been drawing full salary and benefits all along, at an average $109,000 each in pay. The fifteen weeks of extra paid leave is the equivalent of a $31,400+ bonus. Total cost, $66B to people who support Democrats almost exclusively. All necessary COVID relief. If you don’t believe me, ask Nancy Pelosi. This stuff is almost as important to her as ice cream.
Race, Accounting and Other Mysteries
We still haven’t gotten to the most important and compelling expenditures, such as gifts not available to every citizen unless the citizen is black or a Hispanic immigrant. There are distributions of funds to states which have been hard-hit by COVID19. States are prohibited from using any of the money to pay down debt or meet unfunded pension obligations. A fundamental concept in accounting is that money is fungible. That means that it is ultimately impossible to determine how the money was used. If you give me a dollar and prohibit me from using it to pay down debt, I promise I won’t. I’ll use it to pay for paperclips for the State Department of Irrelevancy, then spend the money I would have spent for paperclips and use that dollar to pay down debt. As you can see, that’s a completely different dollar and I have complied with your restrictions.
Thank God you walk in these sewers to bring us light so we don't have to do it ourselves...
Going through a bill is just, well, tedious. Staff creates these things assisted by those most affected. All quite proper you see. They examine exactly what proponents are being benefited and deal with those proponents to ensure they understand what must be returned for consideration. Those considerations are the important bit to those who will someday vote for the bill. The contents of the bill are immaterial, it's somebody else's money after all.
On the regulatory front, inconsistencies are expected. They are created in order to ensure a given niche player can prevent any competition in that area. By being quite specific in the detail they ensure great accuracy and attention to detail. To square away any confusion it's best to hire suitably approved legal staff drawn from previous regulator jobs.
We only imagine the people are in charge. They know who is really in charge. They remain in place regardless of who is chosen to be nominally in charge. They do not like being interfered with because they are dedicated to their sinecures.