President Trump, who was never willing to step into negotiations for a covid-19 stimulus package when they were ongoing or publicly share his view that the bill’s $600 checks were too small, threw an inexcusable wrench into the efforts to send relief to Americans. Now that Trump has agreed to sign the bill, The Post reports, the Treasury Department is “scrambling” to get out the checks after Trump’s stalling. In addition, the “Trump administration is racing to distribute a wide array of funds, including those that aim to boost cash-strapped businesses and help unemployed workers at risk of losing their benefits.” Millions, in other words, could lose a week’s pay.
Democrats have been complaining about the size of the bill’s direct payments, which Republicans opposed until the 11th hour. If not for progressives such as independent Sen. Bernie Sanders of Vermont, Democratic Sen. Kirsten Gillibrand of New York and both Democratic senators of Massachusetts and Oregon (who wanted $1,200 checks), there would not be any direct payments in the bill at all. On Monday, the House passed on a 275-134 vote a measure to increase the stimulus checks from $600 to $2,000; 44 Republicans voted for the $2,000 amount. The measure goes over to the Senate.
There are legitimate criticisms that the checks should not go out to households making as much as $150,000. Nevertheless, there is now more justification than ever for Congress to negotiate more generous checks — and more than just one.
Steven Rattner, former economic adviser in the Obama administration, writes: “At the end of last week alone, four important economic statistics came in weaker than expected and moving in the wrong direction. Consumer confidence fell to 88.6, well below the 97.0 that had been projected and down from a downwardly revised 92.9 in November (originally reported at 96.1).” He adds, “Similarly, consumer spending declined due to a big drop in auto sales as well as in services including food and hotels. The large drop in personal income was directly attributable expiring stimulus programs.” Finally, “after a strong summer and fall, new home sales fell sharply.”
In addition, we continue to add roughly 800,000 new unemployment claims each week. The New York Times reports: “More than 20 million Americans are collecting unemployment benefits and the unemployment rate stands at 6.7 percent. A year ago, before the pandemic hit, the jobless rate touched 3.5 percent, tying a 50-year low.”
This portrait of a decrepit economy explains why the Federal Reserve and businesses alike have been pushing for another stimulus bill for months. As Congress dawdled, distress and hardship for millions of unemployed or food-insecure Americans dragged on. Trump’s hissy fit drags this out even further, but the real outrage was the Republicans’ refusal to pass anything with direct payments for months.
Among other consequences of a prolonged recession and joblessness, Federal Reserve Chair Jerome H. Powell warned in October that “once you’re permanently laid off, it’s just more difficult … to get back into the workforce.” In November, he was still warning, “My sense is that we will need to do more and that Congress will need to do more.”
The danger in trying to steer the economy through the recession was always in doing too little, not doing too much. Now is not the time to worry about spending restraint. Trump’s delay has caused more distress than needed. And the response will have to be bigger if we are to prevent even greater suffering and long-term economic damage. Congress should not wait any longer to get more money into the pockets of more Americans. Dragging their heels is a recipe for economic calamity.
Watch Opinions videos: