Covid Stimulus Talks Break Down, Now What?

Mish

The Democrats and Republicans could not agree on a compromise on Friday. Trump has threatened to call his own shots.

Covid Talk Recap

On Wednesday, White House chief of staff Mark Meadows said it was Friday or Trump's way. 

On Thursday and Friday Meadows Gave a Hard Line in Coronavirus Talks with Democrats.

Mr. Meadows, joined by Mr. Mnuchin, has met daily with Mrs. Pelosi and Senate Minority Leader Chuck Schumer (D., N.Y.) to hash out differences between a Senate Republican plan totaling $1 trillion and a House Democratic measure that cleared the House in May totaling $3.5 trillion. Late in the week, Democrats proposed a package somewhere around the $2 trillion to $2.5 trillion range, but Republicans rejected it, and talks Friday showed no signs of progress. 

The White House has offered concessions from the initial Republican opening bid, such as agreeing to a $400-a-week federal jobless supplement, up from the Senate GOP proposal for an interim $200-a-week supplement before shifting to a program in which the federal assistance, when combined with state aid, would make up 70% of lost wages. Democrats haven’t budged on their demand for a $600 weekly federal supplement, or their demand for large-scale aid to states and localities, although they have agreed to shorten the duration of such assistance to lower the cost of their plan.

Compromise Fails

I believe $400 is a reasonable compromise but it was a no go. Moreover, that compromise might not have passed the Republican Senate.

Senate Majority Leader Mitch McConnell (R., Ky.), who has stayed out of the daily talks, has previously estimated that at least 20 of his colleagues might not support any new stimulus package, amid concerns over mounting federal budget deficits. 

Mr. Meadows “wants to make sure like I do we take care of the people who have lost their jobs,” said Sen. Rick Scott (R., Fla.). “But you can’t bankrupt the country.”

"You Can't Bankrupt the Country"

There's hypocrisy at its finest. Trump and the Republicans are responsible for massive budget deficits before Covid hit.

Nearly all of the deficit increase went straight to the wealthy and the military. The middle class got next to nothing from Trump's tax cut.

Trump Will Go It Alone

On August 5 Trump threatened "I will do it myself if I have to. I have a lot of powers with respect to executive orders," said Trump despite the fact he has no constitutional basis to do so.

It seems we are headed that way as Talks on Friday Failed.

Mr. Trump said he was set to take executive action to suspend the payroll tax, retroactive to July 1 and running through the end of the year. He also said he intended to extend recently expired jobless payments through December, but he declined to say how large the payments would be. He reiterated that he would impose a partial moratorium on evictions and assist with student-loan payments.

“If Democrats continue to hold this critical relief hostage, I will act under my authority as president to get Americans the relief they need,” said Mr. Trump, in remarks from his club in Bedminster, N.J. He said the orders were being drafted, and he expected potential legal challenges if he moved ahead.

“Unfortunately, we did not make any progress today,” Mr. Mnuchin said. “The chief and I will recommend to the president, based upon our lack of activity today, to move forward with some executive orders.”

Democrats said they had offered Thursday night to scale back their proposed spending by $1 trillion if Republicans increased theirs by $1 trillion. “If we take down a trillion and they add a trillion, we’ll be within range,” Mrs. Pelosi said. She said that Democrats could reduce the cost of their offer by shortening the length of some benefits, such as the 15% increase in food-stamp benefits they have proposed.

Legal, Who Cares?

I highly doubt we see a deal this weekend. Will they even meet?

On the Silly Side

Pandemic Checks Stopped

On July 25 the Clock Ran Out on $600 in Weekly Unemployment Benefits as Republicans and Democrats bickered over the next round of stimulus.

On July 29, Trump announced "So Far Apart on Covid Deal That We Don't Really Care"

Now McConnell says 20 Senators might nix any deal. 

That would guarantee Republicans lose the Senate in November and it is close already.

Mish

Comments (88)
No. 1-31
Anna 7
Anna 7

I sure as hell prefer giving checks (of the people’s money) to individuals than to state governments, who will misallocate in worse ways.

tokidoki
tokidoki

Cut all military spending until we recover from Covid. Use the money to restore lost salaries for people who work (a lot of people got their salary cut) and 70% of full income if you've lost work.

Our "enemies" will clap their hands and do the same, making global recovery faster.

Realist
Realist

Why aren’t they talking about how to control the pandemic?

It’s like they’re driving a car with the engine getting louder and louder, about to blow. And they just keep turning up the radio to drown out the sound.

The US economy can’t recover until the virus is under better control. Trumps strategy of wishing it away is insane.

And spending ever increasing amounts of taxpayer money, without a plan to control the virus, is a failure of common sense.

Most other countries seem to understand this. Why can’t the US?

Today’s numbers:

Cases: Deaths

US 63,246:1,290

Italy 552:3

Canada 424:4

Singapore 242:0

Switzerland 161:1

Netherlands 519:1

Austria 141:1

Tengen
Tengen

There is a lot of comedy in hearing Congress bellyache about debt, despite their $1.5T deficits (pre-Covid) and unwavering support for the Fed and bank bailouts.

It's not about whether or not "QE for the people" is correct, it's about rank hypocrisy.

CautiousObserver
CautiousObserver

"retroactive to July 1"

There ought to be a law prohibiting retroactive law changes with only one exception: laws that permanently repeal something can be retroactive such that those with outstanding violations can be forgiven. That's it. No other retroactive laws.

PecuniaNonOlet
PecuniaNonOlet

Here is an idea on how to end coronavirus in the US. This idea is not mine, heard it from someone.

  1. Offer every adult American a one time payment of $5,000 if and only if they stay inside their home sequesterd for 14 days.
  2. If people sequestered at home take a photo of their neighbor out and about, the violator loses their 5k and the person taking the photo gets “their” 5k as reward. What about those in the streets? Well confirmed non sick people can go around photographing others to collect those “bounties.”. Most people wont want to lose 5k so they will stay home. Rich assholes pay a 50k fine for being out that increases 10 fold for recurring violation.

With everone forced to stay home 14 days, the virus is contained. End of story.

critical people that work at power plants and such get priority testing and if test negative go to work and get a special bonus on top of 5k.

Why we opened schools to let kids get infected and act as carriers back home is beyond me and stupid. In 30 days, we will be back at chaos.

Jojo
Jojo

"Covid Stimulus Talks Break Down, Now What?"

Excellent! Now everyone gets back to work and we throw these stupid masks away.

Jojo
Jojo

How do you make decisions when the tests themselves are not reliable? I was happy to find this article tonight after hearing a Dr. Vin Gutpa on either CNN or MSNBC Friday say that he has seen cases where 5 different PCR tests on the same person came back with different results each time. This article explains the problem with PCR tests.

Too many decisions are being based on untrustworthy numbers, whether case numbers or death numbers.

Jun 27, 2020
COVID19 PCR Tests are Scientifically Meaningless Though the whole world relies on RT-PCR to “diagnose” Sars-Cov-2 infection, the science is clear: they are not fit for purpose
Torsten Engelbrecht and Konstantin Demeter

Sechel
Sechel

Trump's action really strikes at the heart of Congress' power of the purse. Does sound unconstitutional an illegal but I'm sure Bill Barr will offer a different perspective.

I'm not surprised we're here. Hard to get a deal one when one side Republicans can't agree on what their side is. Meadows was leaving the bargaining position at the door of Democrats saying if you come with a proposal that's good our side will rally , never actually saying what Republicans want because truth is they are divided on this one. Additionally Trump was not engaged. He spent any political capital putting together a White House plan or telling Senate Republicans what he'd support. Trump was off playing golf this weekend and hasn't spoken to Pelosi for months. He's too bitter. The role of liaison has fallen to Mnuchin.

Lance Manly
Lance Manly

The Dems don't need to take him to court. Any business that collects withholding could claim standing that if they stopped withholding while the treasury was not collecting the tax and a court later found it illegal, they would be on the hook for the funds. Same goes for any state sending out extra unemployment. The GOP should keep in mind how future president Ocasio-Cortez might use the usurping of the power of the purse from congress.

Herkie
Herkie

Mish you introduce this with the following: The Democrats and Republicans could not agree on a compromise on Friday. Trump has threatened to call his own shots.

You have exceptionally high standards in your capacity as a journalist though I know your first calling is economics, but that tagline is borderline misleading.

In fact the democrats passed a $3.4 trillion stimulus package to follow the CARES Act that the GOP called DOA many weeks ago when it was first unvieled. A full month later they finally came up with a responding stimulus package themselves that was about one trillion. But, it was also larded with non stimulus junk that they KNEW was going to be DOA to the democrats the moment they announced it. It was not an offer to negotiate it was blackmail and left the actual people out of the equation, though Wall Street was very happy with it, especially the part about giving them absolute immunity from suits related to killing employees and getting them sick.

It even included about a billion and a half for a new FBI building next door to Trump's DC hotel so that he could profit personally.

So, weeks go by and the democrats say yesterday to the GOP "Hey, we will slash a trillion from our plan if you will add a trillion to yours." It was an invitation to negotiate and compromise but the GOP has said flat out no. And their putative (insane but still in office) party leader Donald the fat orange spy Trump said he will just take executive action, like what I wonder because he does not have the authority to appropriate funds. He has some little room to shift about funds already appropriated in a few of the more discretionary departments, but taking unilateral action of a multi trillion dollar stimulus implies he will draft and impliment his own stimulus plan, and that he cannot do under our constitution where only the US House has appropriation authority.

The GOP has somehow got it in its collective heads that spending is and always will be anathema to the American majority no matter the state of economic emergency, and the fact is Covid economic relief for the PEOPLE has the approval of not only most Americans but of most republicans right now. Yes, there are bits that are unacceptable like the grossly over generous $600 per week that even I think is crazy and deeply resent, but, the GOP has stepped on a landmine that will destroy the party for a generation if they do not come to the table and negotiate a compromise which anyone can see the democrats are willing to talk and the GOP just is not, like babies they demand their own way and will kill this nation if they do not get it.

The last time the USA was in this deep an economic crisis was early 1930, and the GOP was in control then under president Hoover. Their response was a non response or worse actually, it was deep austerity that strangled the already reeling economy. The result was the Great Depression and it scarred everyone who lived through it for life. We are now on the cusp of another possibly worse situation and the GOP seems to be actively working to guarantee that 90% or more of us sink. They do not realize that the US likely will not survive such an economic calamity and they will ahve killed the prosperity they so covet.

So the Chinese curse is full blooded in our laps in that we are living in interesting times. Those intersting times might lso kill us and will make us very unhappy, as a nation we may change so much that for all intents the old US will have died and a new one born, that we do not fit in. Or, it might also just end. In spite of all the internet assurances what comes after will NOT be better than what was killed.

Sechel
Sechel

The Senate never passed any bill. If they passed something there could be a reconciliation effort. It never even got to that point. Continued funding was already doomed. And the White house has never gotten behind anything.

Tony Bennett
Tony Bennett

"Senate Majority Leader Mitch McConnell (R., Ky.), who has stayed out of the daily talks,"

...

Leadership in action ... er, ... inaction ...

Tony Bennett
Tony Bennett

On August 5 Trump threatened "I will do it myself if I have to. I have a lot of powers with respect to executive orders,"

...

I ran it through the gobblygook translator ... out spit:

I'm likely a private citizen in a few months ... and dammit, I'm gonna bail out my hotels and buddies before I leave ...

Quatloo
Quatloo

I’m confused about why the 20 members of the Senate (the ones that won’t vote for any plan) even matter? If the Democrats and the Administration support the plan, you don’t need many Republicans at all to pass the bill in the Senate.

Montana33
Montana33

The Republicans don’t want a deal because they are split in their own party. Their lies about State support prove my point - they claim it’s a blue state bailout when in fact the money would be evenly sent to all States based on a per capita formula. They’re selling propaganda to people who can’t do basic 5th grade math. Massive budget cuts across all States and cities will cause an increase in unemployment. Trump cannot stop payroll taxes- he can delay collection but they are 100% still due - so every company will still collect them. Companies get more time to file payroll tax returns but YOU still owe the same tax. This provides ZERO benefit to working people. The company will still deduct payroll tax every pay period and the COMPANY gets to keep the money for a while. If the employee left, then the employer would Owe that tax so they MUST collect the tax every pay period from us - no exceptions. No Democrat will sue to stop this nothing burger because it’s a disaster for the Republicans. They will promise a tax reduction and then no one gets a tax break. People know when their paycheck is bigger and when it is not. You think people won’t notice that they are still getting charged for payroll taxes? No one is that stupid. Not when it comes to their own paycheck.

njbr
njbr

Here we are.

The President of this country claims to have written "The Art of the Deal" where his prowess as a negotiator and dealmaker were portrayed as second to none.

It is clear that he is no negotiator. He cannot bring opponents together to work out worthwhile solutions.

The only "solutions" to problems throughout his term has been action by emperor's fiat. And the outcomes of those arbitrary actions have shown exactly why he has had multiple business failures and went bankrupt multiple.

He loves the kind of power he has now.

magoomba
magoomba

The piggies want their pork.! All of it!
The swamp is truly bipartisan.

Realist
Realist

Trump cannot get the three sides to agree to anything because he has no idea how to build a consensus. He only has one negotiating tactic: bullying. When that doesn't work, he tries more bullying.

You can see how effective that tactic has been in his trade negotiations. After 3 1/2 years of tariffs, he has managed a modest adjustment to NAFTA and a minimal phase 1 deal with China. Which he then almost immediately reneges on.

A month after signing the new NAFTA with Canada, Trump is threatening new aluminum tariffs. Which is shocking because the US only has the capacity to produce 25% of it's own aluminum needs. And he wants to put a tax on the 75% of imports.

Instead of trying to bully Canada, perhaps he should call up his ”good friend” Justin and ask him ”How are you Canadians crushing the pandemic? Cause it is out of control here in the US! Oh, never mind. It will go away eventually. By the way, any chance you might open your border again? I have friends who want to vacation in Canada, where it is much safer.”

tokidoki
tokidoki

Preorders will start soon for the The Art of Executive Order: How Donald Trump Executive Ordered the Nation to Greatness.

Mr. Purple
Mr. Purple

"Nearly all of the deficit increase went straight to the wealthy and the military. The middle class got next to nothing from Trump's tax cut."

Fascism, a public-private partnership, is welfare for corporations paid by the working class.

Mr. Purple
Mr. Purple

“Aid to states & localities totaling $1 trillion would have 10x the impact on next year’s GDP than resuming the $600 a week jobless benefits." -- this message brought to you by PUBLIC UNIONS.

Mr. Purple
Mr. Purple

Eisenhower warned of the military-industrial-Congressional complex. Funny how that last part always gets left out.

tokidoki
tokidoki

Major News Conference in 10 minutes!!!

magoomba
magoomba

Trump just tore congress and the media a new excrement chute.

magoomba
magoomba

I liked the part where Trump referred to page 1768 of the dem's quickly assembled lobbyist composed 'bill'. Kinda says it all.

Greenmountain
Greenmountain

The next time any Republican claims over reach by an American President this is Exhibit A. I blame all. My solution lock our leaders in a room until they come to a compromise. This is a lot of bull*&^t. In a democracy we compromise. It stinks and we all know it, but that is how the government runs. Congress authorizes spending, not the President - Government 101.

Zardoz
Zardoz

Fear not! Trumpty and the Munchkin have the checkbook out... how many trilllions ya need? No poors, please!

njbr
njbr

Payroll tax cut won't get help to the unemployed and just defunds SS and medicare. Businesses at risk for non-payment of these funds.

Unemployed to get less money, via what? Via an unknown route from FEMA funds to the state unemployment at the beginning of what is supposed to be a record hurricane year? Set up to take weeks, and ends at the end fiscal year--September!

What a deal?? The fart of the deal.

Fed agencies to "look" at ways of forestalling evictions. Hasn't this already been done?

njbr
njbr

Nothing says "man of the people" more than an executive proclamation for the unemployed issued in front of a handful of entitled dunderheads between golf games at a country club with an initiation fee of over $350K

Wake up sheeple
Wake up sheeple

Now they fear monger the dumb public until they get what they want.
Who believes this shit anymore.