Funny money delays but will not prevent a grand reckoning of the debt that’s been piling up for decades. From MN Gordon at economicprism.com:
It has been a rough go for California Governor Gavin Newsom. Late last week it was revealed that the state Department of Public Health had tickled the poodle on its COVID-19 record keeping. Somehow the bureaucrats in Sacramento undercounted new coronavirus cases by as many as 300,000.
Perhaps this oversight prompted Newsom to imbibe in a little meditation and reflection. At his Wednesday coronavirus news conference, shortly after quoting Voltaire, Newsom offered the following epiphany:
“Businesses can’t thrive in a world that’s failing.”
Often the simplest insights into reality are the most essential. We’ll give Newsom that. Yet, this is hardly an insight. Rather, it’s readily obvious…even to a numskull.
The world that’s failing, where businesses can’t thrive, is a direct consequence of government lockdown orders. And Newsom, more than any other public official, has his fingerprints all over the offense. If you recall, California, under Newsom’s command, was the first state to order lockdowns. It’s a shame he didn’t pause for meditation before committing the state to ruin.
The dynamics of what would follow Newsom’s lockdown orders were predictable. When government decrees froze the economy, bills were still due. Yet many people’s incomes, in the form of paychecks, disappeared.
For businesses, outstanding accounts payable were still due. Though accounts receivable quickly became overdue. In short, the flow of cash, as delivered by an open economy of give and take, broke down.
Certainly, Newsom thought he was doing the right thing. He had to keep everyone in the Golden State safe by locking them down. Many governors followed Newsom’s lead, having the same disastrous results.
But that was just the beginning. Soon the uplifters in Washington swung into action…