Bad burgers bailout (FACT SHEET)

So, they want “infrastructure”?

(Archived from original email 5/10/21 newsletter)

It’s been obvious for some time that the wheels are coming off the “Big Infrastructure Bill.”  Among other things, it’s clear the Democrats will have to find a way to pay for most of it.  Evidently, the Federal Reserve—our “fourth branch of Government”—has let them know it won’t just keep printing unlimited “Monopoly money” for them to spend on partisan priorities, interest-group giveaways, and blue-state benefits.  A tap on the shoulder from “the Fed” can be a real downer.

One really telling piece of the plan is to build new VA hospitals.  From late March on, there has been talk of building ten to fifteen new VA hospitals to replace some old ones.  It turns out, they don’t know which ones (if any) need replacing—the VA hasn’t asked for anything specific—so they’d turn that over to a commission to ponder until 2023.  In short, they tossed out “10 to 15” because those are nice, smooth numbers; it sounds more sober than “nine to 14.”  They don’t have a clue.  

In truth, most of the oldest VA hospitals are in New York City, northern New Jersey, and similar parts of the Northeast, and you can’t move them out wholesale to less dense areas without causing huge disruption and inconvenience to the populations they serve.  It would be wiser to remodel individual wings or build some modern additions, then revisit the matter in 25 years when the Vietnam-era veteran cohort (the last really big group of vets) is 99 percent passed on—at which point, we may not even need a VA hospital system at all.  But, clearly, it’s about finding some way to throw money out the door (and give Biden-Harris an easy PR win.)

Of course, we knew that, because they did it a few months ago with their “American Rescue Plan Act of 2021.”  It’s just going to be more of the same.  Sadly, Capitol Hill moves so fast that most Congressional staff never figured out how much random, corrupt junk the Democrats shoved into that stimulus bill.  Most of them don’t have time to read these nutty 800 or 1000-page bills.  But if people knew what was in it, they’d understand the kind of trash that’s going into the next one.

With that in mind:

The Bad Burgers Bailout & Other Buy-offs & Giveaways Act of 2021

  • About $122.8 billion, available through the end of Fiscal Year (FY) 2023, for grants to states for distribution to public (and charter) schools.  The distribution for each state is fixed as the proportion that each state received of total Federal grants in 2020 under Title I of the Elementary and Secondary Education Act of 1965.  This favors high-immigrant, high-minority proportion states such as New York, California, and Texas.  Fair enough, but where it gets wacky is that instead of letting each state determine how to spend the money, states must direct 90 percent of these extra grant funds in the same proportion as the school-district-by-school-district 2020 disbursement of the Title 1 grants.  Thus, underperforming school districts receiving the most Federal money in 2020 will be absolutely soaked to the bone with this additional 2021 cash (which comes on top of and far exceeds the existing Title 1 grant pot, which in FY 2020 was likely somewhere under $20 billion.)  For example, although Governor Cuomo had his entire state locked down, and all school districts in the state must be hurting, New York City schools alone will receive—given the predetermined ratios—over four billion dollars of these additional funds over the next few years if not sooner, whereas all other parts of New York State COMBINED (which account for MORE THAN HALF of the state’s students) will get NOT MUCH MORE THAN HALF OF WHAT THE CITY GETS.  As you can see, Senator Schumer is taking care of his own, and “his own” is not upstate—it’s nothing beyond the Bronx-Westchester or Queens-Nassau lines.  So much for “equity” in education.  We could go into other states, but it seems likely that the grant allocation follows the Title 1 ratios first and foremost to help Schumer’s main base of support, which suffered a $707 million cut to its education budget last year.  Then we have urban school districts in Texas and Florida which probably haven’t suffered much financially from the Chinavirus, and they still receive this mind-boggling windfall, which they objectively don’t “need.”  Granted, they are required to spend some proportion on epidemic-related extra cleaning, transportation, after-school programs for struggling parents, and so forth, but these conditions amount to a vast windfall for school contractors in those areas, and are also wide enough to accommodate a few delivery trucks carrying new stereo sound systems (or what-have-you) for the administration offices.  In short, it is in many cases an over-the-top, gratuitous, sneaky giveaway—even, one could say, a racket.

(Perhaps some conservative thinktank could precisely nail down the numbers, and then the GOP could run with an upstate NY district campaign ad in 2022 along the lines of, “Representative so-and-so voted to stiff our district, giving $4.5 billion to New York City schools but only $2.5 billion to the rest of the state.”)

  • $50 billion for a major disasters fund, available through 2025, which falls conveniently after the 2024 election.  This is good thinking by the Democrats—why ask for the money later, at the last minute, after a disaster, from a potentially Republican congress that may wish to attach a few strings?  Set it aside now in the Free World’s Biggest Slush Fund!  Then dole out billions after every five-point-oh earthquake or brushfire, or perhaps find a way to spend some of it on Climate Change.  In short, the Biden-Harris emergency funds tank is full through their entire first term.  They are all set.  We can only hope that the next Republican administration receives the same benefits.  Of course, this has nothing to do with the Chinavirus, which was the excuse for this bill.
  • About $30.5 billion through 2024 for a bailout of primarily operating (e.g., payroll) expenses of public transit systems/agencies, of which about $26.1 billion must be made available for previous recipients of grants under 49 U.S.C. 5307—in other words, unprofitable transit systems long dependent on Federal aid.  That could be fine by itself, but, strangely enough, the recipients don’t have to quantify/document the financial harm they have suffered from the Chinavirus, nor (in most cases) do they even need to apply.  It is implicitly assumed they earned zero money in 2020 and therefore, they simply get everything they could ask for, and then some, raining down on them.  Specifically, existing recipients under 5307 receive 132 percent of their 2018 operating costs, net of any bailouts they may have gotten in 2020.  Presumably, that extra one-third will carry them well into 2021, which looks to be likewise depressed for ridership.  Once these have fed at the trough, if there’s any money left, transit systems not under 5307 can get 25 percent of their 2018 operating costs covered.  This all might sound reasonable until you consider that the nation’s largest transit systems (particularly subways) are walking dead; essentially all big-city, white-collar employees are now teleworking at least some of the time, and that’s not going to change—everyone knows we’re not going back.  Yet the Democrats have set a precedent that if the Feds have your number, they will pay, automatically, 100 percent-plus of your 2018—pre-COVID and before New York’s 2019 freak-out over its subway finances, very sneaky!—expenses, no questions asked, no adjustment for any revenues you might actually have, keeping you afloat on the dole regardless of your prospects, or whether you even need the money.  It’s a harbinger for permanent mass transit welfare, indefinite total funding of a bankrupt sector.
  • $28.6 billion for the Small Business Administration (SBA) to dole out tax-free (see Section 9673) to restaurants this fiscal year (ending September 30th.)  This provision was evidently written by and for the restaurant lobby.  Owners of up to 20 locations—twenty!—are eligible for grants.  How it works:  An applicant asks to be reimbursed for “pandemic-related revenue loss”, defined simply as revenues for 2019 minus revenues for 2020, if the answer is greater than zero—but what if you’re just a lousy manager?  Or McDonalds is out of style?  In short, ANY CAFÉ/RESTAURANT OR FRANCHISE OWNER, ANYWHERE IN THE COUNTRY, WHO MADE LESS MONEY IN 2020 THAN IN 2019 IS ELIGIBLE TO HAVE THE ENTIRE 2020 ‘SHORTFALL’ SIMPLY GIVEN TO THEM, TAX-FREE, NO STRINGS ATTACHED.  In fact, there is no requirement to show you’re within a jurisdiction that required you to close, or really that you suffered at all.  Also of interest, there is no firm requirement that your establishment must be operating, i.e. with open doors and serving food.  Per the letter of the law, an owner(s) could use the grant to pay his own delayed compensation of up to $100,000 for 2020 (reference 15 U.S.C. 636(a)(36)(A)(viii)(I)(bb)) or to make mortgage payments to hold on to real estate, without any plans or commitment to get people back to work.  In short, it’s a wide-open door for moochers.  What will happen is the corporations, chains, large franchisees—who (through their lobbyists) are best informed about this provision, and who mostly don’t need the help—will rush in and clean out the $28.6 billion within a few months (it’s probably mostly gone already!), and the industry landscape will not change at all.  Whoever was doing well, will do well, and whoever was closed or about to close, will still be out of luck.  This won’t help the unemployed waitress, or liven up a moribund downtown.  On the other hand, it will keep industry donations flowing to some politicians’ campaign accounts.  Anyone still think the Democrats are “socialist”?
  • $850 million for the Department of the Interior’s Bureau of Indian Education, which either runs directly or (in more cases) provides financing to the various tribes/nations for a large number of primary and secondary education facilities and boarding homes aimed at Native American students.  Interestingly, President Trump’s entire budget request for the Bureau of Indian Education for FY 2021 was “only” $944.5 million, and, this additional $850 million must be “allocated… not more than 45 calendar days after the date of enactment of this Act” (the American Rescue Plan Act of 2021)—in other words, by late April 2021, whereas most other provisions of the bill allow for many months or even as much as five years to distribute funds.  In other words, the Democrats have not only NEARLY DOUBLED the 2021 budget for Indian education just with this one line item (there is another $180 million that I won’t go into), but also forced those overseeing it in Washington, DC to get the money out the door at the speed of a bullet.  How do you think this money will be spent?  What do you do if you are an Indian school trustee or principal and suddenly, millions of dollars—with ZERO DIRECTION on how to spend them, NO STRINGS ATTACHED—fall on your head?  We can only assume that many Native American school board members and school administrators have recently upgraded from Nissans to Infiniti’s, and are now planning additions to their homes.  This is simple, dead-stupid buying off of tribal elders and community leaders with massive, intentional corruption.  The Democrats can’t be so stupid as not to realize that most of the money will simply disappear—but they don’t care.
  • In line with the above, $450 million available through the end of FY 2025 for Indian public housing grants, specifically for a program that distributed “only” about $90 million in grants in FY 2020.  For those who did not study math at Harvard, this means the grant program’s budget has been doubled for the five years from 2021 to 2025, inclusive (although the grants can be used to reimburse expenses made from January 2020.)  There are basically no strings attached, as the grants don’t even have to cover Chinavirus-related expenses so long as they are used to “fund eligible affordable housing activities… during the period that the program is impacted by coronavirus.”  (OK, whatever.)  Moreover, to get the money out the door as fast and with as few conditions as possible, the Secretary of the Interior is authorized to WAIVE certain applicable statutory requirements, to include the provision under 25 U.S. Code §4112 that the Secretary require grant applicants to submit a statement (whether or not it is to be reviewed) as to what they plan to do with the money.  Yes, you read that correctly.  Interior can simply shovel money out the door without any idea as to how it might be spent—the applicant simply asks for X dollars, and Uncle Sam can disburse it.  The wonderful thing (for the recipient) is that with no commitment, no statement on file, you can spend on anything (triple your own salary, hire your spouse, give yourself a million-dollar bonus, etc.) and there will never be any consequences, because it’s not (legally) fraud and you’re not lying to the Government, not to mention that Uncle Sam obviously just doesn’t care right now.
  • $772.5 million for direct grants to tribal government operating expense accounts—just a blanket handout to cover their budgets, no strings attached.
  • $600 million to build, renovate, and/or equip Indian healthcare facilities to deal with the Chinavirus… when the epidemic is practically over.  But don’t worry, the money will be spent.  (There are billions more dollars in Indian healthcare spending authorized under this bill, but much of that is for insurance reimbursements and other things that sound more legitimate.)
  • As reported elsewhere, although you can count on the Dreizin Report for much, much more detail:  An indeterminate sum to pay off all loans made or administered by the Department of Agriculture to each and every minority farmer in its portfolio… and then some.  The “payoff” will be at 120 percent of the loan value, and Agriculture is free to decide how to work that extra 20 percent, which per the news media is supposed to cover the tax implications of the loan forgiveness.  Agriculture can either write a check for 120 percent of the loan to the farmer, the 100 being for the loan and the 20 as a gift—in which case, believe it or not, there is no strict requirement, under the plain language of Section 1005 of the bill, for the farmer to actually use that money to pay off the loan; no chance this is an accident; very sneaky!—or they can simply write off the loan and then send the extra 20 percent gift to the farmer.  Although media reports suggest the value of this provision is $4 to $5 billion, in fact, no specific appropriated sum is given (or, I don’t see it), probably as for the most part—with the exception of the 20 percent top-off—this is merely an accounting exercise for Agriculture; the Department will be striking loans off of its own books (and of course, Federal agencies don’t do double-entry accounting for the most part.)  Nonetheless, it would be really funny if they found the money—it’s not prohibited under the bill—to send out checks for the full 120 percent… and the loans still don’t get paid off!

(The argument for this provision is to compensate African-American farmers for generations—since the Depression era if not earlier—of discrimination in farm loan administration, as if all of them were around for that.  Of course, the ones getting the payoff now, they have loans, so obviously they weren’t the ones discriminated against—just brilliant!  How is this even legal?  What this really does is open the door for “reparations” in other fields in which loans are held by the Government—college loan debt being the obvious big one.  After all, was there not discrimination in university admissions and scholarships as well?)

  • $100 million in grants to “housing counseling intermediaries” (let’s just say, housing counsellors) through the end of FY 2025.  Seriously, how many housing counsellors are there, and how much money do they need?  It’s not as if they weren’t getting paid already; they are mostly taken care of by Federal, state, and local government grants as it is.  Do we have any reason to believe that this career field has been hit hard by the Chinavirus?  It seems like more corrupt overkill to me.
  • $1 billion for “nutrition assistance” (food stamps) for Puerto Rico, the Marianas, and Samoa through the end of FY 2027.  OK, but doesn’t sound like Chinavirus relief to me.
  • As part of divvying up $100 million in Chinavirus-related “capital projects” funding across minor U.S. dependencies and “free association” countries, the south Pacific paradise known as the Republic of Palau, with 17,907 living souls as per Wikipedia—and zero Chinavirus cases at least as of April 1, 2021—gets about $14,285,714.  Yeah, this will be spent on a COVID-19 “capital project”, for real!
  • Internet-only news organizations are now eligible for the Paycheck Protection Program.  Redstate and Gateway Pundit, step right up… Not!  You folks are probably not welcome.
  • And finally, to be fair, a small improvement over prior bailouts:  About $39.6 billion in grants to institutions of higher education, available through the end of FY 2023, but read on.  Colleges/universities must use half of this for financial aid grants to students (i.e. to reimburse themselves for the value of the tuition discount.)  With the other half, they can do what they want (with a few exceptions—no capital outlays on athletic facilities, no executive salaries or bonuses, etc.)  This is an improvement relative to Section 314 (Higher Education Emergency Relief Fund) of the Consolidated Appropriations Act, 2021—signed into law on December 27, 2020—under which college/university bailouts could be used 100 percent to simply defray “lost revenue” or “reimbursement for expenses already incurred.”  Nonetheless, this is still a large sop to a very bloated and wasteful industry.  If higher education is to receive a bailout (bad enough), it should go 100 percent—not 50 percent—towards tuition.
  • OK, that’s a wrap from the Dreizin Report.  Just wanted to provide a taste of what was in the last stimulus bill, and what may go into the next one, which they are trying to sneak through as “infrastructure.”  There’s so much more trash in this bill—this thing is a giant rotten peach, straight-up dripping with corrupt buy-offs and giveaways—but I don’t get paid to do this.  It would be nice if the Republican/conservative or independent corner of the news media had some folks to review and analyze legislation full time, but in this country of 330 million, it looks like it’s just me, just one volunteer with three kids and a day job, and that’s OK—that’s why you’re reading me!  Thank you!!!


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