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Workplace Recovery Act

by Resurgent Guest Read Profile arrow_right_alt

The owners and workers of America’s businesses—both small and large—have done their part. When government called upon them, they stepped up by shutting down, though many of them were unsure whether they would ever reopen or return.  

This is America and we will come back. There aren’t a more resourceful and resilient people on the planet. We have gotten through tough times, and we always find a way that makes us stronger on the other side. It will take determination, political courage and good policy.

Now it’s time for government to do its part to help workers and employers devastated by COVID-19—or more precisely, the measures government took to combat it.

No amount of stimulus alone can put the economy back on track. Passing out checks to some Americans has been short-term and incomplete because it wasn’t designed to create sustained economic activity. The shutdown has put a stop to commerce—the lifeblood of our economy. Both workers and customers need to return to the workplace.  

Some states are trying to reopen their economies, to lesser and greater degrees. But how many businesses simply won’t have the operating cash to reopen, and will shutter for good? And how many of the jobs they once provided will be gone? One survey in Wisconsin says that if the shutdown continues for three months, 35 percent of small businesses will close permanently.

Here’s where government can do the most good—by restoring that vital operating cash. To that end, a growing coalition of workplaces that already represents roughly half of America’s pre-COVID workforce has come together to support the Workplace Recovery Act (WRA). The WRA will accomplish what is equitable, to provide needed repairs to the damage done to businesses and workers.

The WRA is modeled after principles developed in the private sector to deal with businesses interrupted by natural disasters. It would direct federal funds specifically at businesses that have incurred and can demonstrate cash operating losses after March 1. The WRA compensates businesses for cash losses for up to twelve months but phases out as revenues return and workplaces become self-sustaining. 

The WRA will restore workplaces, not provide expansion capital. Claim funds would be earmarked and restricted to cash operating costs such as payroll, operating costs, and rent and debt payments. There would be no coverage for lost profits. The WRA would ensure the government pays the bill for the damage the shutdown has done.

In the end, targeting affected businesses in this way means that families, workers, and communities supported by sustained economic activity can get back to providing for their families and living their lives – even under new health safeguards. Those who have already sacrificed so much deserve the first chance to get back on their feet.  

We’ve seen what happens when programs are not targeted. Washington sent $1,200 stimulus checks to Americans whether they needed it or not, then told them they can’t leave the house to spend the money. And the Paycheck Protection Program (forgivable loans for businesses) was largely depleted before small businesses could even get their paperwork in.

The Workplace Recovery Act avoids these problems by targeting only the businesses and workers that need it and ensuring funds are available for an allotted amount of time rather than just for those first in line. Moreover, the WRA is fair—it is government doing its part, after Americans have done theirs.

We are facing an unprecedented crisis, and any new overly broad government policies have the potential to make the cure worse than the disease. But a targeted approach to stabilize and activate our economy is the kind of boost Americans need to become secure and prosperous again.

That’s why we need the Workplace Recovery Act; its measured, thoughtful approach to the pandemic—and the economic fallout from government’s response to it—will help get U.S. economy back on track.

Rod Bordelon is a senior fellow and director of the Center for Fiscal Policy at the Texas Public Policy Foundation. 

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