By frequent correspondent The Chief
While the theatres are still closed, there is a storm a brewing and it will likely premier around January of next year. I came across an article on Seeking Alpha, (the hard news part not the commentary part) about $40 billion in uncollected utility payments so far during the pandemic. If that doesn’t shock you, I do not know what will.
Link: Who will pay $40B in COVID-19 debt owed to utility companies?
I am not going to long form blog this like I usually do, but I just want to point out that is a debt that is not repayable. During the beginning of this two week shutdown to flatten the curve back in March, most governors, if not all, declared utilities cannot disconnect. Thus, folks with past due accounts, because Covid, got free utilities. Unlike the government, they cannot print money and will have to account for this loss some way or another.
What is the answer? Sadly, I lost my crystal ball, but my thoughts are the following: the moratorium on this will continue as the optics of turning off heating in the winter for grandma doesn’t look great. Ditto for low-income families, or renters. I feel the answer will be blended; to those who faithfully paid their bills (most Republicans and responsible folks), will be told thanks and get nothing and like it. For those who didn’t pay, it will depend on your local PUC (Public Utility Corp) to decide. Maybe you make small “catchup” payments, or they wipe out your balance and you get to start over (just like PG&E). I’m thinking its option 2. I can see Biden bailing out the “green” utilities, or incentivizing those who phase out coal etc. This will be the way of pushing the Green New Deal. I also think the PUC will grant a “Covid recovery fee” to be added to all bills to make those folks current. Once again, in this country, those who are responsible will get nothing and those who refused to pay (you must remember, the moratorium applied to anyone, not people Covid positive) get bailed out. This will be the Biden/AOC way to force the Green New Deal on us.
Sadly, I see this same issue playing out in other sectors of the economy as well; how many folks haven’t paid rent due to this? In addition, how about unpaid mortgages? That number will dwarf the 80 billion easily. Credit cards? Ditto, especially after this year’s Christmas Season. Buckle up, I do not see a very pretty 2021, you won’t be able to kick this can very far.