Back in March, House Speaker Nancy Pelosi threw a monkey wrench in the time-sensitive process of delivering badly-needed relief to Americans affected by the coronavirus pandemic. With a Senate bill all but ironed out, Pelosi and her compatriots in the House drafted a fiscal albatross of a bill full of items straight from the progressive wishlist that had little to do with responding to the crisis at hand. Though the delays created by this political stunt cost Americans everywhere, Pelosi seems not to have learned from the past, recently offering up an even more profligate and unhelpful piece of legislation than last time.
H.R. 6800, or the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, passed the House by nine votes May 15. The last House bill, the Take Responsibility for Workers and Families Act, would have carried with it a substantial price tag of roughly $2.4 trillion, including at least $364 billion in spending apart from what ended up in the final CARES Act. But the HEROES Act is even more expensive — the National Taxpayers Union Foundation estimates that it would increase spending by more than $3.5 trillion.
Just like its predecessor, the HEROES Act would increase funding for several programs and departments by many times their usual budget. The Emergency Broadband Connectivity fund, for example, funded at just under $24 million in this year’s budget, would receive $8.8 billion in funding under HEROES — a nearly 37,000 percent increase. The Fund for the Improvement of Post-Secondary Education would see a similar boost, from $25 million to $8.4 billion under HEROES.
But the funding proposals aren’t just significant increases when considered relative to baseline funding. Governors recently have been demanding $500 billion in funding to states — on top of the $189 billion they have already received — an amount which would make up more than three-quarters of annual state revenues. But not only does Pelosi not reject this ludicrous demand in the HEROES Act, she offers to pass out even more taxpayer dollars — setting funding to state governments at $540 billion, as well as a further $90 billion for a state fiscal stabilization fund.
Local governments would be able to get in on the bonanza as well, reaping $375 billion in added funding under the HEROES Act.
And the perks for states don’t end at oodles of cash. The HEROES Act would also repeal the caps on the state and local tax (SALT) deduction, a provision that would overwhelmingly benefit wealthy Americans. Despite the obvious hypocrisy of progressives defending tax breaks targeted to the rich, Democrats have long advocated for the SALT deduction because it permits states to levy higher taxes on their wealthy residents while allowing them to blunt the impact through the federal tax code.
Plenty of other provisions that made their way into the HEROES Act bear little relevance to combating the pandemic. The bill appropriates $15 billion for highway infrastructure programs, $10 billion for “community development,” and $25 billion to bail out the Postal Service.
Other provisions, while conceivably related to the crisis at hand, are funded at exorbitant levels. The bill would appropriate $180 billion for a “HEROES fund” which would offer premium pay to essential workers, $100 billion for emergency rental assistance, $75 billion for homeowner relief, $16.5 billion in payments to agricultural producers and $11.5 billion in grants for assisting the homeless. All of these can be justified as being related to the economic hardships Americans are facing as a result of the pandemic, but the total price tag for these five programs alone comes in at $383 billion.
While it’s true that more action is likely needed to provide relief to Americans still struggling with the economic and health effects of the pandemic, the old Democratic solution of “throw money at the problem and hope it goes away” is unhelpful here. What’s needed is smart, targeted solutions, not an indiscriminate spending spree.
Andrew Wilford is a policy analyst with the National Taxpayers Union Foundation, a nonprofit dedicated to tax policy research and education at all levels of government.
