As election year partisanship torpedoed a new round of coronavirus economic relief, the White House is looking at a new series of actions. House Democrats want no part of any piecemeal solution. They want their $3 trillion omnibus package, or nothing.
Nothing is what they got. But there is money remaining in the first round as well as tappable FEMA funds, and the Administration is prepared to go ahead without Congress. Plans include allocating funds for school vouchers and retooling President Trump’s temporary payroll tax deferral to make it work better.
After talks broke down, President Trump took quick action and signed four executive orders to partially restore expiring $600 weekly unemployment payments at a reduced rate of $300, along with a deferral of payroll tax payments to the end of the year. The package applies to workers earning less than $104,000/year and has provisions that discourages home evictions and defers student loan payments.
While the economy is slowly recovering and the unemployment rate is steadily increasing, a new coronavirus relief package would keep things together. Democrats, loathe to give any credit to the Trump Administration, according to Senate Majority Leader Mitch McConnell, “just point fingers, call names and keep blocking American families from getting any more help before the November election.”
Meanwhile, Minority Leader Chuck Schumer accuses the Republicans of “looking for political cover” instead of bipartisan cooperation.
As Congress bickers and begins a pre-election round of the blame game, President Trump suggested reallocating $300 billion in untapped coronavirus relief funds and sending Americans a second $1,200 stimulus check.
The President didn’t identify the funding source, although it would likely come from remaining original stimulus funds. Said the President, “It’s money that we have – money that we built up and money that we haven’t spent, and I would love to give it to the American people as a very powerful stimulus.”
Also, while the nation’s economic recovery has been somewhat tepid, the labor market is far from its pre-crisis level. Employers were able to add 1.4 million jobs in August, and the unemployment rate is down to 8.4%.
Unfortunately, there are still 11.5 million more Americans out of work than there were at the beginning of the pandemic. As the first unemployment payments expired, President Trump, as previously mentioned, instituted a $300-a-week-unemployment benefit by executive order on August 8.
States had to apply for the aid by September 10 and had to agree to kick in up to six weeks of their own payments to eligible workers. Only South Dakota chose not to apply for the federal money and, so far, 27 states are doling out the funds to their unemployed workers.
However, not every unemployed worker is eligible. Only those receiving at least $100 in unemployment assistance through their regular state programs can receive the boosted benefits. Also, since benefits are calculated partly on a worker’s former income, some of the country’s lowest wage earners will be excluded. That means at least 1 million people will not qualify for the increased benefits.