On March 12, the New York Federal Reserve announced a $1.5 trillion injection of money into the US financial system. Three days later, it cut its benchmark interest rate to zero and announced it would be buying at least $500 billion in government bonds and another $200 billion in mortgage securities.

The Fed is returning to a policy of “Quantitative Easing” in response to the COVID-19 panic. The idea behind these moves is that throwing money at the banks and the government will “stimulate” the economy by keeping credit easy for consumers and business borrowers.

I have a better idea.

The Fed’s new QE announcements already top $2.2 trillion.

For Fiscal Year 2018 (the year your last tax return covered), the US government only collected $1.6 trillion in individual income tax.

The projected amount for Fiscal Year 2019 is probably more than that, but not a great deal more, and almost certainly not as much as the Fed is already planning to throw into the mix.

If the US government is serious about “stimulus,” it should announce that instead of accepting tax returns this year, the IRS will immediately (no waiting for April 15, no questions asked) cut and mail refund checks for every dollar of income tax it collected in Fiscal Year 2019.

Instead of the Fed magically creating a bunch of new money out of thin air and giving it to banks and the government, just give Americans our own money back.

We’ll take that money to stores and buy things with it (that’s “actual economic demand”), which will stimulate the economy a whole lot more, and a whole lot faster, than the Fed’s magic money sitting in bank balances waiting to be loaned out (that’s “prospective economic supply”).

Yes, my proposal would result in an even bigger federal budget deficit this year than usual, adding more to the government’s debt. But that was going to be the case even before the coronavirus. And both major American political parties have made it clear — in action even when they don’t admit it — that they don’t believe deficits matter.

If the COVID-19 panic is the economic equivalent of a heart attack, and that’s pretty much what it is, the Fed’s response amounts to slapping the patient’s face and urging it to wake up while praying loudly and fervently.

Actually putting people’s tax money back in their pockets would be the equivalent of a direct adrenaline injection to the patient’s heart.

Thomas L. Knapp (Twitter: @thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.

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The jury is still out on which of two things — COVID-19 or the panic over COVID-19 — will cost more lives and do more damage to the global economy. My money’s still on the latter. In the meantime, I’ve developed a surefire, Groundhog Day type test for whether the emergency is over:

Watch for Nobel laureate economist and New York Times columnist Paul Krugman to start trying to convince us it was, all in all, actually a GOOD thing.

Krugman on 9/11: “[T]he direct economic impact of the attacks will probably not be that bad. And there will, potentially, be two favorable effects.”

Krugman on Fukushima: “[T]he nuclear catastrophe could end up being expansionary, if not for Japan then at least for the world as a whole.”

Krugman would even have us believe that Pearl Harbor ended the Great Depression (which actually ended more than half a decade later). “If we suddenly had a threat of war and a military build up,” he once asserted on ABC News’s Roundtable,  “you’d be amazed how fast the economy would recover.”

Krugman is the 21st century’s foremost evangelist of the Broken Window Fallacy.

In Frederic Bastiat’s “parable of the broken window,” a shopkeeper’s son carelessly breaks a window pane.

A witty onlooker — Paul Krugman’s ideological ancestor — considers this a good thing because it creates business for the glazier who replaces broken windows.

As Bastiat points out, though, while the cost of replacing the  pane is seen, other things aren’t:  That was money the shopkeeper could have spent on a new pair of shoes, or on a book he wanted to read.

Instead of buying something that improves his life, the shopkeeper has to spend that money just getting back to his previous condition.

To cover costs like replacing the window, he probably raises prices, meaning his customers have to spend more on his products, leaving them less to spend on other things they might like.

Even the glazier’s customers get screwed. Broken windows increase demand, which means higher prices. The man building a new house has to pay more, and wait longer, for new windows.

The matter is a loss, not a gain, for everyone except the glazier.

Can we expect to see some long-term beneficial consequences from COVID-19 and its associated hysteria? Yes.

Two likely outcomes are large, permanent increases in “telecommuting” (working from home instead of traveling to an office) and “distance learning” (taking classes from home instead of traveling to a university campus).

Those two trends were already noticeable, but fear of contagion is boosting them tremendously. When the fear subsides, the benefits will be remembered. Not as many people will be returning to offices and campuses as left them. That means lighter traffic, lower energy consumption, and more spare time for many workers and students.

Those are good things, but we could have had them any time we wanted them, with or without COVID-19 and the associated mass hysteria. Contra Krugman, any “bright side” to catastrophe costs more than it’s worth.

Thomas L. Knapp (Twitter: @thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.

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The Wile E. Coyotes of the Internet — US Senators Lindsey Graham (R-SC) and Richard Blumenthal (D-CT) — are sure that THIS time  they’ve finally found a made-to-order tool that can take out the Roadrunn … er, those meddling ki … er,  the First Amendment and  Section 230 of the Communications Decency Act.

Surely, they believe, their latest super duper special Acme rocket —  the “Eliminating Abusive and Rampant Neglect of Interactive Technologies Act of 2020,” aka “EARN IT” — will finally allow them to deprive you of access to the strong encryption that protects your privacy, so that they (and every hacker on the planet) can snoop on you at will.

Here’s the cartoon character genius and deviousness of the EARN IT Act:

It doesn’t actually OUTLAW strong encryption, nor does it REQUIRE companies to cripple their products with “back doors” for law enforcement.

All it does is create a commission to establish “best practices” for Congress to pass into law.

What could possibly be the harm in that? Well, the EARN IT act would deprive any Internet platform that doesn’t implement those “best practices” of its Section 230 protection from liability for content created by parties other than itself.

What kind of “best practices,” one might ask?

“Best practices” for protecting user security? Nope.

“Best practices” for protecting freedom of speech, promoting vigorous commerce in digital goods and services, etc.? Nope.

“Best practices” for “preventing, identifying, disrupting, and reporting child sexual exploitation.”

You had to know that these cartoon character politicians were going to pull yet another “for the chilllllllldren” gag, and they lay it on thick — the words “child” and “children” appear nearly 300 times in the bill’s text.

And you have to know that among the first set of “best practices” to come down the pike will be demands that platforms prang  encryption so that law enforcement can more easily read your emails, your text messages, etc.

If you’ve thought the matter through, you probably also know that the EARN IT Act and its associated “best practices” won’t prevent or disrupt child exploitation. The strong encryption genie has been out of the bottle for decades and no number or type of “best practices” can stuff it back in. People who have something to hide already have, and will continue to use, the tools they need to hide it. The only thing EARN IT will prevent or disrupt is your privacy and freedom.

Only the innocent and law-abiding among us would be affected by the EARN IT Act, and the effects on good and important things like freedom and privacy would be wholly negative.

Graham, Blumenthal et al. certainly know this too. Don’t let them trick you into thinking they’re just harmless idiots like Wile E. Coyote.

Thomas L. Knapp (Twitter: @thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.

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