August 9, 2020; New York Times
In a statement that may come to define the White House response to more than just pandemic economic relief, Treasury Secretary Steven Mnunchin offered, “We don’t have to get everything done at once.” Getting anything done at anywhere near the scale of the problem we have, however, would help. Instead we have posturing and sleights of hand that wouldn’t fool an audience of toddlers.
Back in May, the US House of Representatives passed the $3-trillion Health and Economic Recovery Omnibus Emergency Solutions Act” or “HEROES Act.” The bill was imperfect, but at least it provided a framework for a comprehensive response.
But Mnuchin can rest easily. Most assuredly, everything is not being done at once. Instead, hardly anything is being done at all.
For the record, over the weekend, in an act of what Senator Ben Sasse (R-NE) called “unconstitutional slop,” President Donald Trump signed four executive actions that, as Emily Cochrane, Alan Rappeport, and Luke Broadwater detail in the New York Times, promise to “revive unemployment benefits, address an eviction ban, provide relief for student borrowers and suspend collection of payroll taxes.” Not included in the executive orders are money for the Paycheck Protection Program, stimulus checks, aid to schools, or funds for state and local governments.
Trump appears to have no ability to make anything substantial come to pass without the Congress, however, so what’s the fuss about, exactly? Senator Lindsay Graham (R-SC) took a gentler tack, tweeting “I appreciate the President taking this decisive action, but would much prefer a congressional agreement. I believe President Trump would prefer the same,” without mention of the fact that Trump, in fact, cannot make the money appear without Congress.
Perhaps we should be grateful that Trump took time out of his busy weekend hobnobbing with potential donors at the country club to put on this flimsy illusionary show which appears to have been phoned in with no expectation of anything more than some momentary public attention and grandstanding because, naturally, with executive orders come constitutional questions. Can a president spend tens of billions without authorization by Congress? (The unemployment payments are to be funded through a reallocation of $44 billion in disaster relief funds). Can a president unilaterally defer the collection of taxes Congress has approved? In both cases—especially the second—the likely answer seems to be “no,” but that’s almost beside the point.
Beyond the constitutional questions, the more immediate issue is whether the measures meet the moment—here again, the answer is “no.”
Emblematic of the non-serious approach to the nation’s very serious economic emergency is the unemployment order. If President Donald Trump was going to issue an emergency order to resuscitate federal supplemental unemployment benefits—why not reestablish the existing $600 a week program? But that would be too easy. And, as NPQ noted last month, if $600 a week payments were extended, that might suggest US workers are valued—and we can’t have that now, can we?
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Instead, the new “lost wages assistance program” is $400 a week. And, as it happens, the $44 billion repurposed for this program could be gone in less than five weeks.
Worse, the federal government would only cover $300 of that $400, with the remainder to be covered by the states, which collectively expect revenues to fall short by over $370 billion in fiscal-year 2021 alone. Simply put, states don’t have the money, which is why they are seeking federal support—not increased federally mandated expenses.
On CNN’s State of the Union, Governor Mike DeWine of Ohio, a Republican, diplomatically said he did not know if the state can afford $100 a week for unemployment insurance. Of course, it is unlikely Ohio has the funds to do so.
Larry Kudlow, director of the National Economic Council, acknowledged, also on State of the Union, that it was uncertain if the states had the money. Moreover, the added payments could take weeks to make it into people’s unemployment checks.
Other measures likewise prove to be less than meets the eye. For instance, the eviction measure does not ban evictions, but instead “would require agency leaders to review the necessity of such a moratorium and examine whether additional federal funds were available to provide rental assistance” according to the Times team. And the Times points out that the payroll tax suspension through December is unlikely to take effect.
Meanwhile, there is a lot of fiddling going on along the banks of the Potomac as Americans continue to suffer. Already, the pandemic has cost 162,000 Americans their lives (and counting), with over 30 million unemployed Americans receiving unemployment insurance checks—at least before the July 31st cutoff.
This past May at NPQ, we quoted from a 2010 study coauthored by members of the Center for the History of Medicine at the University of Michigan and the federal Centers for Disease Control and Prevention (CDC). The authors noted:
Pandemics demand a multidisciplinary response and call on all of society to engage and participate. There are clear roles for both private citizens and uniformed personnel; for households, communities, work forces, volunteer organizations, and professional organizations; and for traditional governance structures at the local, state, and federal levels.
In other words, in a pandemic, we need all hands on deck. Instead, however, our current predicament recalls a rather different nautical metaphor: no hands on the wheel.—Steve Dubb