EDITORIAL: Government unions made out like bandits on COVID relief

There remains no concrete way to determine precisely how much money COVID fraud has cost American taxpayers. An NBC News report in March estimated that thieves diverted as much as 10 percent of the $800 billion the government spent on the Paycheck Protection Program. In addition, according to the report, unemployment scammers made off with 10 to 40 percent of the additional money Congress set aside for the jobless.

“Nothing like this has ever happened before,” one former U.S. attorney told NBC. “It is the biggest fraud in a generation.”

Meanwhile, there were those on the safe side of the law who also made out quite nicely. Namely, public-sector workers across the country, many of whom weren’t even on the job for long stretches of the pandemic.

“Federal funds intended to be used for pandemic relief efforts,” Eric Boehm of Reason magazine wrote this week, “were used instead to pad the paychecks of government employees from coast to coast.”

Democrats in Congress attached plenty of conditions to the pandemic funds they directed to keep private-sector businesses afloat. They also specifically forbade governments from using virus funds to cut taxes. Not surprisingly, however, they weren’t quite so diligent when it came to allowing politicians to fill the coffers of government unions.

According to a Reason analysis of Treasury Department data, local governments spent $5 billion in COVID money on “worker support,” which includes salary hikes and bonuses for their employees, few of whom lost jobs or took pay cuts during the pandemic. That’s the same amount of money, Mr. Boehm noted, “that states and local governments reported using for actual COVID relief — a category that includes ‘vaccinations, testing, contact tracing, PPE, prevention in congregate facilities, medical expenses, and other public health measures’. ”

The trend was fully evident in Southern Nevada, where the city of Las Vegas in 2020 spent almost $105 million in CARES Act funding on its worker payroll, which caught the attention of state lawmakers. This week, the Clark County School District said it would use pandemic money to pay for bonuses for teachers and administrators.

Last year, Democrats jammed through the American Rescue Plan, showering an additional $525 billion on states and local governments under the guise of repairing their battered budgets. Never mind that the financial calamities many observers feared never materialized, and a number of states, including Nevada, survived COVID financially intact. Republicans argued at the time that the bailouts pushed by congressional Democrats and the Biden administration were unnecessary and a stealth means of rewarding their government union benefactors. Turns out, that’s precisely what they were.