Who Is The American Rescue Plan Enriching?


Show Notes

Corruption matters, in everything the government does. In ordinary times, it shows up in the little side deals that members of Congress slip into spending bills. They funnel money to their campaign donors and their friends, but in small enough doses that it’s not worth fighting about.

But these are not ordinary times. Our national economy is struggling to overcome the effects of the COVID pandemic and eradicate the threat to our health and our prosperity. So when the Biden administration offers a $1.9 trillion proposal called the “American Rescue Plan,” you might think the side deals would be toned down and the money would go to… rescue Americans. Well, guess again.

“Unfortunately, our taxpayer dollars are being used for some ridiculous expenditures that were sold by this Harris and Biden administration,” says former congressman Jason Chaffetz (R-UT) on the latest  episode of TheDrillDown podcast. “They are spending, for instance, $600,000 to build two gazebos at Guantanamo Bay. They’re spending $363,000,000 on an attack submarine… but that’s not COVID relief,” Chaffetz tells co-hosts Peter Schweizer and Eric Eggers these funds “have nothing to do with COVID relief, but they are using Covid relief to get these funded and paid for.”

In fact, only 10% of the money goes to COVID relief. So, where is the rest of it going?

As one example, Republicans in the House found $140 million going to build an underground rail line connecting Silicon Valley to San Francisco, which is represented by House Speaker Nancy Pelosi. They tried – and failed — to reallocate those funds to mental health grants for children that suffered from the pandemic.

House Minority Leader Kevin McCarthy (R-Calif.) complained that the bill was largely unnecessary, pointing to an estimated $40 billion in expenditures flowing to California’s state government, despite the state recently reporting a $10 billion budget surplus.

The proposal includes $500 million for, as the Congressional Budget Office puts it, “grants to fund activities related to the arts, humanities, libraries and museums, and Native American language preservation.” It also has $1.5 million for the “Seaway International Bridge,” which connects New York to Canada, which has been a favorite for New York Sen. Chuck Schumer.

Less than 10% of the entire package will go towards vaccine production and distribution and other healthcare related to COVID-19. But the proposal includes $86 billion to shore up pension plans for 185 different labor unions, including those representing truck drivers, builders, and retail clerks, the New York Times noted.

Unions generally endorsed Biden during the 2020 election cycle, including the National Education Association, the Service Employees International Union, and the International Brotherhood of Teamsters. The bill contains $129 billion for K-12 schools, but the Congressional Budget Office estimates that about 95 percent of those funds won’t be spent in 2021, in part because funds approved for schools last year haven’t been spent yet.

The Democrats allocate $413 billion in checks to American households far and wide, at $1,400 per man, woman and dependent, that would phase out after $75,000 of individual income. The Congressional Budget Office says the bill’s unemployment provisions will increase federal deficits by $246 billion, and that its $400 a week in federal “enhanced” unemployment benefits through August “could increase the unemployment rate as well as decrease labor force participation.” Doesn’t sound like much of an economic stimulus. Peter points out that shoveling all this money to the states actually encourages them an incentive to reinstitute lockdowns to get more money. As economist Milton Friedman used to say, “if you tax something you get less of it, and if you subsidize it, you get more of it.”