Covid ‘Relief’ Bill Spends Billions on Items Unrelated to Crisis Recovery and Risks Inflation

The House of Representatives is expected to vote this week on final passage of the ‘American Rescue Plan Act,’ a $1.9 trillion proposal touted as ‘Covid relief’ but containing add-ons having little to do with crisis recovery.

Vice President for Strategy Iain Murray said:

“With economic conditions looking better than they have for a year, now is not the time for spending trillions more taxpayer dollars on top of needed relief passed in the previous Congress. The bill is full of provisions that could spur inflation, which is when too much money chases too little production. Instead, the Congress should consider further supply side reform – deregulation, ending legacy tariffs, and other measures aimed at reducing household costs. It should also strip out unrelated provisions like the bailout of multiemployer pension funds.”

Vice President for Policy Wayne Crews said:

“Coming on top of last year’s roughly $4 trillion Covid rescue, the Biden Administration and Democrats in Congress are planning to spend the equivalent of the annual burden from the entire regulatory state: $1.9 trillion. On top of spending too much, the ‘American Rescue Plan Act’ contains add-ons having little to do with crisis recovery. From bailing out states and localities that crippled their own economies and schools to spreading billions of taxpayer dollars to special interests that support progressive causes, this bill leverages a crisis to expand government.

“Instead of reducing bureaucratic red tape standing in the way of businesses serving customers and keeping health care providers from safely seeing patients – policy choices that would foster resilience in our economy and set us on a path to renewal – Congress is rewarding political constituencies and expanding dependency. Now is the time to start a discussion about shifting the stance of the federal government from one of paternalism to one of dignity enabled by a resilience and growth mindset.”

Director of CEI’s Center for Energy and Environment Myron Ebell said:

“Among all the wasteful, economically destructive provisions in the Democrats’ $1.9 trillion ‘stimulus’ bill, perhaps the most disastrous is the $350 billion of taxpayers’ money given to state and local governments.  Bailing out these fiscally irresponsible governments without conditions will allow them to continue the reckless policies that are leading to insolvency and economic decline.  In particular, California, New York and several other states can use the billions of dollars their allies in Congress are throwing at them to maintain climate policies that are raising energy prices and destroying jobs, rather than actual crisis relief.”