Unemployment numbers in America have absolutely exploded in a way that’s never been seen before. New jobless claims last week of 2.981 million brought the total to 36.5 million Americans filing for unemployment in the past six weeks.
It is expected those numbers will improve in the coming weeks as more of the country begins to reopen businesses but it’s unclear what the actual reopening will look like at this point. We saw pictures of bars in Wisconsin absolutely packed within minutes of a court ruling there. But even in states where restaurants have been allowed to/forced to reopen it’s not as if customers are rushing out to dine there.
State and local governments can speed up the reopenings all they want but if the customers don’t opt into it then it’s all for nothing and the businesses will crumble. Dallas Mavericks owner Mark Cuban fired off an interesting Twitter thread over the weekend putting forth his ideas on how to keep these businesses alive
Essentially, Cuban suggests giving every American household twice-monthly checks that must be spent within a specified period of time. He claims this ‘trickle up economics’ approach is the only way to save America at this point which seems like a bold claim given that we have no idea if the reopening will even work or if states will be forced to restrict movement again in the coming months. Here’s his thread:
It’s hard to even comprehend how much a company like Amazon must’ve benefitted from the first round of $1,200 stimulus checks. My pea brain cannot even imagine the portion of that money that went straight to Jeff Bezos’ company.
I don’t know how you’d get around that with Cuban’s approach and not see the twice-monthly money spent primarily online instead of at local businesses but I’m sure they could flush out some ways to do that with more time refining this idea. Someone said people should only be given money to pay off debt and not buy new TVs but with this proposal, they’d be allowed to spend it on anything just as long as it was within 10 days.
Would all of this work? That’s something an economist would have to answer. My stupid ‘minor’ in Econ back in college means I’m absolutely nowhere near an expert in economics and in times like these the only people we should ever be listening to are the experts. But it is an interesting idea and one I expect to see explored in the news over the coming days and weeks.