Texas Public Policy Foundation report analyzes Rehire America Workplace Recovery Act

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Vance Ginn | Texas Public Policy Foundation

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By Juliette Fairley

Americans can expect $1.4 trillion in economic output and to keep their jobs once the Rehire America Workplace Recovery Act (RAWRA) is implemented, according to a new study.

“What we show is that the program, until February 2021, would pay for itself over six years, including the $1.3 trillion cost,” said Vance Ginn, senior economist with the Texas Public Policy Foundation.

The Rehire America Workplace Recovery Act: An Economic Analysis report found that the RAWRA would bring increased tax receipts to state and local governments, reduce unemployment insurance claims, lower welfare spending and reduce the risk that more federal funding will be required to support state and local governments.

“The federal government is going to have this expense, which would increase the deficit because they don't have any additional money at this time but with the RAWRA you would have more economic growth that wouldn’t otherwise be supported,” Ginn told Washington D.C. Business Daily.

If enacted, the RAWRA would direct cash injections to businesses impacted by COVID-19 shutdowns.

“The WRA will only cover businesses that run operating losses, which allows them to stay in business without the funds being siphoned off to larger businesses that are already profitable,” said Ginn in an interview. “This becomes an efficient way of keeping businesses open and not abusing taxpayer dollars in the process.” 

The $1.3 trillion is an amount still available that Congress has authorized for the first phases of the coronavirus pandemic, according to Ginn.

“It hasn’t been allocated yet so there is a path for us to not spend even more money if Congress were to re-allocate those funds that have been authorized to the Workplace Recovery Act,” Ginn said.

There are risks, however, which include an extension of the $600 weekly unemployment benefit, a second wave of coronavirus infections leading to renewed governmental shutdowns, shuttering of schools and political gridlock between Republicans and Democrats, according to the report.

“These are risk factors that would prevent the economic benefits from being as high as they otherwise would be,” said Ginn. “These risks wouldn't prevent the RAWRA from being passed necessarily. It should be passed but it would reduce the benefits of the overall program.”

On July 20, 2020, Congressmen Filemon Vela (D-TX) and Lance Gooden (R-TX) filed H.R. 7671, also known as the Small Business Comeback Act, which is similar to the RAWRA proposal.

“It’s a bipartisan bill that has a lot of the same spirit as RAWRA,” Ginn said. “There are some differences that I think should be improved upon but if there is at least H.R. 7671 that's been filed, hopefully, it will be a part of the discussion for the relief package of whatever is going to be passed over the next couple of weeks.” 

The Small Business Comeback Act would establish a fund to provide businesses with coronavirus recovery support.

“It improves upon the framework used in the Paycheck Protection Program because it is designed to provide freedom and flexibility to the businesses who were harmed by mandated closures,” said Congressman Lance Gooden in an online statement. “We wanted to reduce restrictions on how they could use the money. We’re not helping anyone if we cover them in red tape and new regulations just as they’re trying to get back on their feet. With this legislation, we can take a strong step toward seeing our economy through one of the greatest challenges it’s faced in a century.”

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