Is $7.6 billion a lot?

sounds like a lot
Nevada Republican Rep. Mark Amodei. (Photo by Alex Wong/Getty Images)

Congressman Mark Amodei is the only Republican in Nevada’s congressional delegation, and he would be the state party’s titular head if only he was more likable than Adam Laxalt.

Just kidding. Amodei is renowned for his “aw shucks” folksy manner. The media is especially enamored with him, which is super annoying. Laxalt also tries to be a hail well met fellow. Alas, Laxalt’s efforts are painfully contrived, which is one reason people regard him as the political equivalent of an ankle-biting curtain climber.

But I digress. This isn’t really about Amodei, or Laxalt. It’s about $7.6 billion.

In his latest “Amodei Report” newsletter (not horrible as congressional newsletters go, but nor is it a tour de force in the genre like, ahem, some newsletters), Amodei said something literally provocative, which is to say it provoked some thought and reaction, from me anyway. What Amodei said is this:

In Nevada, hospitals have received more than $600 million in aid across four relief packages, state and local governments have received $1.25 billion, funding for housing projects has totaled over $19 million, direct payments to individuals totals over $2.5 billion, and as mentioned above, relief for small businesses in Nevada totals over $2 billion. This funding amounts to more than $7.6 billion in aid to the state and its citizens.

Huh. That sounds like a lot.

Amodei thinks so:

To put these funding levels into perspective, consider the fact that Nevada’s budget is enacted to cover a two-year period, known as a biennium. The most recent two-year state budget was approximately $27 billion, which would average about $1.125 billion per month. Meaning, at this point, the federal government’s direct assistance has more than surpassed the state’s operating budget.

Well, there’s no denying that’s definitely a factoid. And as is often the case with factoids, one appropriate response is “so what?” 

Juxtaposing coronavirus relief spending to the Nevada state budget doesn’t put the funding levels into perspective. It does the opposite of that. For one thing,  Nevada has forever and always been one of the nation’s cheapest states (see good lists, bottom of), and the state’s budget is the last thing anyone should be using as a benchmark or standard by which efforts to address the impacts of the COVID-19 crisis can be fairly judged or measured.

If we want “to put these funding levels into perspective” (and we do!), let’s not compare them to Nevada’s deliberately designed-to-be-cheesy-skimpy-and-inadequate state budget.

Let’s compare them to Nevada GDP.

According to Federal Reserve economic data, total Nevada gross domestic product — the total value of the state’s economy — in 2019 was $177.6 billion. That averages to $14.8 billion per month. That includes the money you and your families have been earning, and spending. It includes our income and our commerce. It is what has been vanishing.

Yes, $7.6 billion in the nearly two months since Congress started passing relief packages exceeds the state operating budget for a couple months. Or six. But it is barely half the size of a single month of state GDP — or what GDP was, anyway.

Put into another perspective, $7.6 billion might be about 28 percent of Nevada’s two-year budget. It’s barely 4 percent of 2019 GDP.

Quick, who thinks Nevada’s economy has shrunk by far, far more than 4 percent? Yeah me too.

State government and the state budget are taking a hit. But that’s because GDP is also — or at least the parts of it that “trickle down” through “job creators,” as Amodei and his fellow Republicans might say.

What’s the total so far, pushing $3 trillion in federal relief bills? A lot of that has been going out the door fast — so fast that last week Congress had to replenish the small business paycheck protection program.

Other money is taking an agonizingly long time to make it to people, particularly unemployment assistance for 1099 (gig, etc.) workers. States are struggling to figure out how to process those claims, which require a rejiggering of state unemployment insurance programs that have never covered gig workers. Only 17 states are paying the benefits so far. Nevada is not one of them. The state hopes to have gig-worker unemployment figured out by mid May. Meanwhile, the state employment department is telling such workers not to apply right now, because they’re still ineligible and the online application system will just kick them out. 

In other words, Nevada, already quickly burning through its unemployment insurance fund, might see yet more spikes in unemployment filings. Yet benefits are going to have to be extended, including and especially the federal $600 a week that’s paid on top of state benefits.

Unemployment checks are only one reason Nevada is going to need a bunch more money from Congress. Nevada’s “reopening,” you see, is going to be slow, perhaps depressingly so.

As our beleaguered and increasingly freaky-deaky nation goes forward, Congress is going to have to allocate more money for a lot of things, including but not limited to: shoring up long-neglected state government services as demand for them peaks (Nevada isn’t the only state that’s cheap); giving small businesses a chance to survive; and just to help people, you know, buy food and household items, although Trump may decide disinfectants should be covered by your health coverage, if you have any. 

Amodei’s and Laxalt’s fellow Republican, Senate Majority Leader Mitch McConnell, is retreating to the banality of evil, as is his custom. He is now warning that all this federal spending is out of control and oh my stars and garters won’t someone think of the deficit, etc. etc. (That would have been a nice sentiment when McConnell & Co. were ladling a $1.5 trillion tax cut to the rich and corporate. Oh well.)

Don’t listen to him, Amodei. Sure, $7.6 billion sounds like a lot. But it ain’t enough, not by a long shot.

Hugh Jackson
Editor | Hugh Jackson was editor of the Las Vegas Business Press, senior editor at the Las Vegas CityLife weekly newspaper, daily political commentator on the Las Vegas NBC affiliate, and author of the Las Vegas Gleaner political blog. Prior to moving to Las Vegas, he was a reporter and editor at the Casper (Wyoming) Star-Tribune.