GOP Worries Mnuchin Is Giving Away Too Much

GOP Worries Mnuchin Is Giving Away Too Much

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Plus, the deaths that could have been prevented
Thursday, October 22, 2020
 

GOP Worries Mnuchin Is Giving Away Too Much in Covid Relief Talks

House Speaker Nancy Pelosi (D-CA) said negotiators were “just about there” on the issue of funding testing and tracing programs for the coronavirus, a key provision in the relief bill she is trying to hash out with Treasury Secretary Steven Mnuchin.

But numerous other provisions are still unsettled, including the crucial issues of aid to state and local governments, liability protections for businesses and funding for schools, and time is quickly running out to get a bill ready before Election Day.

Pelosi said she still holds out hope that a bill can come together quickly. “It's only about time,” she told reporters in the Capitol. “I think it is in range for us to pass it before the election. But it's not up to me to decide what the Senate does.”

Pelosi also warned that even if negotiators can agree on all the details soon, the legislative process will take time to complete. “If we can resolve some of these things in the next few days, it’ll take a while to write the bill,” she said.

White House economic adviser Larry Kudlow highlighted the difficult road ahead. “There are still significant policy differences between the two teams,” he said, adding that Democrats need to amend their offer. “The clock is ticking,” Kudlow said.

Growing frustration for Senate Republicans:
Some GOP senators are concerned that Mnuchin is giving too much away in his negotiations with Pelosi, The Washington Post’s Erica Werner and Jeff Stein report. The White House offer is now close to $1.9 trillion, a figure that many Republicans have said they would refuse to support. Mnuchin has also reportedly agreed to $300 billion in assistance for state and local governments, another problem for many on the right.

“He negotiates harder with his own side than he does with her. Folks over here are sick of it,” one Republican aide told the Post. Mnuchin “gives and gives and gives and gets nothing in return,” the aide added.

While some Republicans say they might support the bill — Sen. Marco Rubio (FL) spoke favorably about it Thursday — it’s hard to imagine it passing a GOP-controlled Senate. “There are not 13 votes for this pile of crap Mnuchin is capitulating on,” a Republican aide said.

Questions about the politics:
Conservative activists raised serious questions about the way Republicans were approaching the relief bill. Former senator and Heritage Foundation leader Jim DeMint said some GOP lawmakers don’t trust the Treasury secretary. “They don’t feel like [Mnuchin] is negotiating for them, and certainly not for conservatives,” DeMint said. “The consensus is he’s trying to get something done. And to get something done with Nancy Pelosi will require something most of us will not feel good about.”

Republican political strategist Liam Donovan complained to the Post that there are “zero policy wins” for the GOP in the still-developing bill.

At the same time, Republicans could suffer politically if they are seen resisting a relief bill that would provide much-needed assistance to millions of Americans. “Except for a handful from the neo-austerity caucus among Senate Republicans, everybody else would see the boost from it, and they would get credit for helping people in the middle of a crisis,” said Tony Fratto, a former George W. Bush administration official. “It’s bad economics but also just really dumb politics.”

Pelosi was happy to highlight the confusion on the Republican side of the aisle. “I do believe that both sides want to reach an agreement. I can't answer to the disarray on the Senate side,” she said.

“It's not up to me to psych out Mitch McConnell,” she added. “It's about the president of the United States engaging in a discussion, but it's up to him to deliver what can happen on the Senate side.”

Number of the Day: 130,000 to 210,000

Between 130,000 and 210,000 deaths could have been avoided through earlier action and a stringer federal response to the coronavirus pandemic, according to a report released Thursday by disaster preparedness experts at Columbia University.

CNN reports:

“Insufficient testing, a lack of national mask mandates or guidance, a delayed overall response and outright mocking of basic public health practices by the administration has put the United States at the top of the global coronavirus death toll, the report from Columbia University Earth Institute's National Center for Disaster Preparedness finds….”

“The research team compared the US response to the policies in other countries. If the US had followed the policies and protocols of Australia, as few as 11,699 people may have died, the report estimates.

“Following Japan's policies would have led to as few as 4,315 deaths in the US, the Columbia team calculated. Even France did better and had the US followed France's lead, 162,240 Americans would have died -- around 60,000 fewer than the current total.”

Jobless Claims Drop, but Remain Historically High

About 787,000 people filed initial jobless claims in state unemployment programs last week, the Labor Department announced Thursday, a drop of 55,000 from the week before and well below analysts’ expectations.

Another 345,000 people filed for benefits through the Pandemic Unemployment Assistance program, the federal program that covers gig workers and the self-employed, an increase of roughly 8,000 on a week-over-week basis.

All told, about 1.1 million people made first-time claims for unemployment benefits, a drop of about 200,000 from the week before. The total number of people receiving any kind of unemployment assistance also fell, down to 23.1 million in early October, a drop of about 1 million.

A mixed picture:
The good news is that a downward trend in new jobless claims, which are used as a proxy for layoffs, appears to be solidifying, with the three of the last four weekly reports showing a decline. The bad news is that new claims still registered over 1 million — a staggeringly high level not seen in the post-war era until the coronavirus crisis took hold.

“The overall picture remains unchanged -- the downtrend has been stalling even though the latest decline is somewhat encouraging,” said Bloomberg economist Eliza Winger.

Running on empty?
“We’re not calling people back fast enough at a time that we know many households are running on fumes, unable to pay for food for the week and rent,” said Diane Swonk, chief economist at Grant Thornton. “It bolsters the case for stimulus and aid, now," she added. "I feel like a broken record.”

New York, Portland and Seattle Sue Trump Administration Over Funding Threat

The cities of New York, Portland and Seattle, which the Trump administration last month labeled “anarchist jurisdictions,” filed a lawsuit Thursday to fight the designation and the threat to federal funding that accompanies it.

“The Trump administration’s political threats against Seattle and other Democratic cities are unlawful and an abuse of federal power,” Seattle Mayor Jenny Durkan said in a news release announcing the federal lawsuit. “It’s immoral, unconstitutional, and shameful that we are forced to expend any resources on this political theater.”

Following protests marred by some violence in the wake of the killing of George Floyd by Minneapolis police, President Trump issued a memorandum last month that sought to have the government review federal funding for “jurisdictions that permit anarchy, violence, and destruction in America’s cities.”

The Justice Department then said that New York, Portland and Seattle had “permitted violence and destruction of property to persist and have refused to undertake reasonable measures to counteract criminal activities.”

The lawsuit filed by the cities Thursday in U.S. District Court in Seattle argues that the president can’t add arbitrary conditions to money duly appropriated by Congress. “It is the Defendants, not the Cities, who are engaging in lawless behavior and threatening the democratic order established by the Framers,” the lawsuit says, according to the Associated Press.

The suit calls the administration’s action “offensive to both the Constitution and common sense” and challenges the use of the “anarchist jurisdictions” designation. It also warns that the threat to withhold federal funding during a pandemic is “deadly serious.”

New York Mayor Bill de Blasio reportedly called the funding threat “a totally political action” that would hurt the city as it looks to deal with the pandemic. “The only anarchy in this country is coming from the White House and it’s not anything we’ve seen from any Democratic or Republican administration ever before,” de Blasio said, according to Bloomberg News.

New York City Corporation Counsel Jim Johnson reportedly said the cities are suing because, while no funds have been withheld so far, the federal government has started taking “concrete steps” to use the anarchist jurisdiction designation to reject applications for funding that, in New York’s case, could total as much as $12 billion.

A Bad Time for Biden's Tax Hikes? Why Joe Says No

When he’s not slinging dubious accusations of corruption, attacking Joe Biden’s son, Hunter, or propagating conspiracy theories, President Trump has frequently been hitting the former vice president on his tax plans, warning that they will prompt an economic depression.
“Remember, BIDEN is going to raise your taxes at a level never seen before. This will not only be very costly for you, it will destroy our economy, which is coming back very rapidly,” Trump tweeted Wednesday.

He later added: “The Radical Biden-Harris Agenda is projected to slash the typical American’s income by $6,500 per year. They will raise TAXES by $4 TRILLION DOLLARS – triggering a mass exodus of jobs out of America and into foreign countries.”

The facts:
Biden has proposed raising the corporate tax rate from 21% to 28%; raising the top individual income tax rate from 37% to 39.6%; lifting the income cap on Social Security payroll taxes; and taxing capital gains at regular income rates for those making more than $1 million a year. He insists that he will not raise taxes on people making less than $400,000 a year. Independent analyses have found that Biden’s tax plans would raise about $2.5 trillion in revenue over 10 years, with the burden of those higher taxes falling almost entirely on businesses and high earners — and with relatively little effect on economic growth. For more details, see here, here, here or here.

On the other hand, former Trump White House economists Kevin Hassett and Casey B. Mulligan released a study last week that said that Biden’s plans would result in about 5 million fewer jobs and about $2.6 trillion less in gross domestic product by 2030. The report estimated that Biden’s agenda would cost the median family about $6,500 in income by 2030, the source for Trump’s claim on the stump.

But the methodology of that study has come under criticism for unfairly penalizing Biden for tax cuts set to expire as part of the 2017 Republican tax law.  “I’m trying not to be overly partisan, but I think they’ve put their thumb on the scale in that way,” Rich Prisinzano, director of policy analysis for the Penn Wharton Budget Model, tells Bloomberg Businessweek.

A bad time for tax hikes?
The bigger question surrounding Biden’s plan at the moment is whether it’s would be wise to raise taxes when the economy has been weakened by the coronavirus pandemic. Asked about that during his ABC town hall last week, Biden said: “Absolutely.” The Biden camp argues that the investments in infrastructure and other areas that the former vice president proposes to fund through tax hikes would pay off with stronger growth — though Biden acknowledged he would still need to get the congressional votes to pass such legislation.

The New York Times’s Jim Tankersley and Thomas Kaplan explained the debate earlier this week:

“Republicans have long asserted that any Democratic proposals to raise taxes would hurt the economy, regardless of whether it was booming or ailing. In recent years, including in the Democratic presidential primaries this year, Democrats and liberal economists have more forcefully argued the opposite: that raising taxes on the rich to fund government spending that bolsters the productivity of the United States economy will accelerate economic growth.”

Stimulus first: Even as Biden defends his tax-hike proposals, The Washington Post’s Jeff Stein reports that the former vice president isn’t likely to pursue those plans as part of any short-term stimulus meant to fuel recovery from the effects of the pandemic. “However, the former vice president would likely aim to include his tax increases if Congress approves his proposed permanent spending plans, such as expansions in child care, health care or education,” Stein writes, citing two sources familiar with the campaign’s thinking. “A Biden campaign aide confirmed that his commitment to paying for spending priorities did not include short-term stimulus measures.”

The bottom line:
The economic arguments are one thing, but don’t ignore the political challenges inevitably involved with just about any tax hikes. As Stein suggests: “Biden may still face significant political obstacles in securing passage of his various tax hike proposals even if his party controls both the House and the Senate.”

The final presidential debate of 2020 is tonight at 9 p.m. ET. Will you be watching?

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