Stimulus checks seem great: free money from the government. The classic Robin Hood scheme. A small stem towards wealth equality; inching toward a Universal Basic Income.
(Pro) In fact, stimulus checks overwhelmingly help the poor; the poorer you are, the more they help— an equal amount of $1000 or $1200 or $2000 will be felt more keenly by someone with less money for whom this amount can cover a month or even more worth of expenses. With some schemes, like Biden’s latest, there’s a wealth cutoff— those making $80,000 per year won’t get these checks, leaving the payout to those who truly need it.
(Con) The entire idea of this stimulus is, well, to ‘stimulate’. People will spend the money quickly on rent or groceries or Amazon purchases. The problem is, all the money eventually flows to the rich: there’s no wealth created for normal Americans. Your rent goest to a landlord, your grocery money goes to a corporation, and Amazon purchases…well…you get the point. In short, there’s a reason wealth inequality is at an all-time high— injecting cash into the economy without structural changes to bring long-term balance.
(Pro) But, long-term balance isn’t the point. The point is short-term stimulation. There’s a problem: the 2008 financial crisis, or the 2020 corona crisis— the injections act as a short-term solution to the economy.
(Con) The huge influx creates long-term problems, however: although far less inflation has happened than you’d expect— the prices of food and clothes isn’t driven up by stimulus checks— asset prices like those for stocks and real estate and bitcoin skyrocket. This creates asset bubbles and wild speculation that results in the very crashes that the stimulus is supposed to save us from— like curing a hangover by getting drunk.
(Pro) Market control by the US fed isn’t as dangerous as this sounds. Take a look at any financial measure of US wealth over time— GDP, or real GDP per capita, or the stock market— and you’ll see that central bank monetary policies like stimulus checks definitely have helped the US to succeed. It’s a rising tide that lifts all boats (if, admittedly, some boats are lifted a bit more). The US racks up ‘debt’, but this debt isn’t financially dangerous like personal debt because it’s owed in US dollars that the US federal reserve can continue to print.
(Con) And here’s a vital point: the US can get away with enriching itself and its citizens in a way that few other countries can. Stimulus checks are given away flippantly because the US dollar won’t suffer too much. The American empire makes sure that the dollar won’t suffer through enforced use of the petrodollar (making countries by oil in US dollars), and by American military policies that favor US interests. These stimulus checks, therefore are part of monetary control that reinforces the US imperialism and economic colonialism.