By David Weinstein
In the immortal words of Monty Python, “And Now for Something Completely Different.” (Spoiler Alert: I’m not going to talk about historic preservation. Instead, if only to distract everyone in Laguna Beach and let tempers cool down a bit, I’m going to talk about the recent stimulus package.)
I know the stimulus package is helping local businesses survive, which is crucial. However, I’ve also heard from my restaurateur buddy that he’s having trouble hiring staff back. Some just aren’t willing to take the pay cut from their generous stimulus and unemployment benefits to return to work. Besides, many haven’t had the chance to finish watching all three seasons of Cobra Kai on Netflix yet. This difficulty in hiring is especially challenging since he’s anticipating a surge in business as we head down the color chart towards the Green Tier.
I find I’m confused about how I feel about this, so I called Stan. He works in the office next to me and is my “go to guy” on unconventional matters and questions about money. It’s not as if Stan is a financial genius, but he knows how to bet the Pick 6 at Santa Anita Racetrack, and he consistently collects on these bets, which is impressive enough for me.
Stan shares his thoughts. “The stimulus package is a good deal, Slim,” (a name he’s misapplied to me ever since I asked him to stop calling me “Shifty” in front of my clients). He goes on, “It’s already saved me a year’s worth of student loan payments for my kid.”
Maybe since I haven’t been “stimulated” with any of the government’s money I’m dubious. So, I counter, “Hey, that’s fine for you, but how does it help the rest of the economy?”
Stan answers. “The government isn’t like you and me. They’ve got this big printing press, and they can print ‘Benjamins’ like that paper you’re writing for prints real estate ads. When they’ve handed out enough of these, instead of everyone hoarding them, they go out and spend them, which is good for all of us.”
He sees I’m not fully convinced, so he shares an example he thinks I’ll understand. It goes like this.
A tourist visits Laguna Beach. He stops at a local hotel and lays two $100 bills on the front desk, saying he wants to inspect the rooms to pick one out for the night. As soon as he walks upstairs, the hotel owner grabs the bills and runs next door to pay his debt to the laundry service. The lady who owns the laundry service then takes the $200 and runs down the street to retire her debt to her hairstylist. The hairstylist, who has racked up a big tab at the wine bar, rushes over to settle her account with the bar owner. The wine bar owner, who has been staying at the local hotel since his wife kicked him out, takes off with this money to pay his room bill. The hotel proprietor receives the two $100 bills and carefully places them back on the counter exactly where they were, so the tourist will not suspect anything. A moment later, the tourist comes down the stairs, says he has decided not to stay at the hotel after all, picks up his money, and leaves.
No one actually produced anything. No one earned a thing, but somehow the town’s business owners are out of debt and everyone is feeling a bit more optimistic about the future.
Self-satisfied, Stan leans back in his chair with his arms folded across his chest. “Did you get that, Slim? The tourist is just like our government.”
I reflect on what he has said. I am now more confused than ever and wish I had paid more attention in my macroeconomics class. I answer. “Well, I guess this makes about as much sense as anything else I’ve heard.” And a moment later an intriguing idea pops into my head. “Hey Stan,” I say, “How would you feel about talking to a few folks in Laguna Beach about Historic Preservation?”
David Weinstein is a Newport Beach resident.
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