GOP Worries Mnuchin Is Giving Away Too Much

By Yuval Rosenberg

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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