Chamath Palihapitiya didn’t hold back when discussing the previous relief funds put forth amid the coronavirus pandemic. The venture-capital investor and the Social Capital CEO told CNBC that he felt the country’s efforts in the COVID-19 relief stimulus missed its mark.
He called the first phase more or less a waste of time, feeling that it was “wasted.” He felt this way because many companies he believes did not utilize the funds they received properly, with many of them resorting to layoffs even after the stimulus came through. Blaming companies for not allocating their money the right way, Palihapitiya also called out the stimulus plan for rewarding what he called “zombie” companies, which he said are organizations that cannot pay back their debts on their own.
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Palihapitiya feels the best method for any future stimulus plans is to give money directly to the consumers. “It’s consumption that drives growth in the United States,” he explained. He added that when more Americans have money to spend, it can drive employment and capital allocation. When these people have extra money, they will support businesses and revive the marketplace, “That’s how we grow ourselves up.” The $1,200 stimulus check that first went out did help provide a small boost to the economy, but the delay in providing additional financial help mixed with the delays in getting out those checks has caused that to be more of a blip on the radar.
What Palihapitiya is preaching is what many Americans would agree with. Since negotiations for a second stimulus check have stalled out and doesn’t appear likely to pass before the November election, there’s a lack of optimism building up in the nation as the coronavirus continues to dampen the economy. Jared Kushner was the latest to pour cold water on the idea of a new relief plan being passed anytime soon, suggesting it would not come until after Donald Trump and Joe Biden face-off in the election because of how “political” the negotiations have gotten. This comes after Sen. Ted Cruz echoed a similar sentiment, believing the impasse is a move made by Democrats to keep people frustrated at the current administration.
As talks remain ominous, the coronavirus remains active across the country. As of Tuesday night, the reported number of cases is more than 6.6 million, with approximately 196,000 deaths. Dr. Anthony Fauci recently shared his belief that COVID-19 won’t be going away anytime soon.
