Pandemic Economics: CV19 And Economic Opportunities For Vermont

Publisher’s Note: Thanks to our neighbors at Vermonters for a New Economy for this post exploring how the Vermont state government can take active steps to mitigate the CV19 situation and support the needs of all Vermonters, as well as creating new opportunities.

The state legislators have given themselves a recess before addressing some of the problems that the declaration of a public health emergency and mass quarantine creates. Very few of our legislators need to worry about paying their rent and mortgage when they are not working, but for the vast majority of working Vermonters, the closures, cancellations, and delays cause serious economic distress.

The fact that Phil Scott vetoed paid family leave which would have made it possible for sick workers to stay home without penalty puts all of us in a lot more jeopardy now than we would have been otherwise. The delay in a long overdue raise in minimum wage also means that low wage workers simply do not have enough of a financial cushion to survive periods like this. 

Now with schools closing, we are faced with new life-threatening economic realities. Most working parents do not have adequate income to afford full time care for young children, so they have brutal choices – leave young children home alone, stop work and potentially lose their jobs, or find options where the children might be exposed to additional illness to make ends meet. 

How can the legislature make sure the most vulnerable among us don’t suffer additional hardship in this very difficult time? Our elders, our children, our friends and families with high risk conditions deserve better. Here are some things our elected representatives might consider doing, even remotely, while they are protecting themselves from getting sick:

1. Expand unemployment benefits to cover people who are temporarily out of work because of the pandemic, not just those who have been ordered to stay home because they are sick. Reduce the paperwork required, make the benefits easy to obtain for small business owners and others who would normally have a hard time collecting the benefits.
2. Enact a moratorium on rent and mortgage payments, putting barriers in place so people won’t lose their homes when they can’t work. This has been a successful strategy for pandemic containment in Italy, in addition to relieving families of unnecessary stress.
3. Provide emergency funding to the Vermont Food Bank, area food shelves and community meal sites so people who have suddenly lost their income can eat. Subsidize the purchase of take-out containers for all the schools and senior meal sites in the state. Pay delivery drivers for their time and mileage.
4. Expand the income eligibility for the program that provides Vermonters with subsidies for child care for people who need to continue to work through this crisis.

Vermonters are resilient and resourceful, yet this pandemic presents challenges even the hardiest among us have never faced before. We are fast to come to the aid of neighbors who need help, our small communities are tight knit places where people know each other and notice when something is amiss. Yet now it is wise for all of us to stay home, contact with other people potentially exposes us to sickness or worse. We need to work together to set up mutual aid networks and check on elderly friends and neighbors who might need extra help and for whom this disease could be deadly.

With a lot of economic activity shut down, we also need to find new ways to trade and exchange with each other that don’t use the scarce dollars we do have. Time Banks like the Onion River Exchange, which allows people to make exchanges using time instead of money can help. Organizations like the VBSR Marketplace that facilitate business barter arrangements also can keep people employed and keep businesses running.

If Vermont had its own public bank, finding the resources for all these emergency measures would not be so fraught with the looming overburden of debt we’ve had since we borrowed millions of dollars from Wall Street to rebuild after Hurricane Irene. Germany, Costa Rica, Taiwan, even North Dakota have these public institutions that allow the state to issue credit the same way banks do, and any interest that is paid on the lending comes back to the state. The 10% for Vermont program enacted back in 2014 proved that the concept worked, the $35 million that was put into circulation by the Treasurer’s office paid back much better interest than we get on our deposits held in the large Wall Street banks. But further efforts to use a public bank for all our public deposits have been stopped in their tracks by politicians like Beth Pearce who fear the bankers more than they care about protecting the interests of the majority of Vermonters.

It’s true that Vermont is a small state and taking on the banking and insurance industries to have truly public finance and health care is hard to do. The companies we challenge with these policies have lots more money than the State of Vermont, and they deploy many local lobbyists to make sure their interests are protected. Our lack of political will to do it leaves us short in times like this when the economy is collapsing and we have a serious health care crisis on our hands. Perhaps the pandemic will have a silver lining and the folks we elect to represent us in Montpelier will find it in their hearts and minds to take on Wall Street and the medical insurance establishment for the good of all of us.