Download This PaperRelief Fund Allocation Is No Place to Play Politics
3 Pages Posted: 8 Apr 2020
Date Written: March 27, 2020
Abstract
The Coronavirus Aid, Relief, and Economic Security (CARES) Act gives the Treasury Department and Federal Reserve the authority to invest at least $850 billion to stabilize the economy, prevent business failures, and encourage businesses to retain employees on their payrolls until the public health crisis passes. However, there is a potential risk that capital allocation decisions will be intentionally or inadvertently distorted based on private firms’ social preferences rather than the needs of the public.
Keywords: bailouts, legislation, risk management, fiscal policy, Federal Reserve, healthcare, coronavirus, coronavirus pandemic, COVID-19, public health, economics, quarantine, economy, economic crisis
JEL Classification: I00, I18, H60
Suggested Citation: Suggested Citation
Brian Knight (Contact Author)
George Mason University - Mercatus Center ( email )
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United States
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