Trump orders allow some pay for jobless, a payroll tax deferral

BEDMINSTER, N.J. — Seizing the power of his podium and his pen, President Donald Trump on Saturday bypassed the nation’s lawmakers as he claimed the authority to defer payroll taxes and replace an expired unemployment benefit with a lower amount after negotiations with Congress on a new coronavirus rescue package collapsed.

At his private country club in Bedminster, New Jersey, Trump signed executive orders to act where Congress hasn’t. Not only has the pandemic undermined the economy and upended American lives, it has imperiled the president’s November re-election.

Perhaps most crucially, Trump moved to continue paying a supplemental federal unemployment benefit for millions of Americans out of work during the outbreak. However, his order called for up to $400 payments each week, one-third less than the $600 people had been receiving. How many people would receive the benefit and how long it might take to arrive were open questions.

Congress had allowed the higher payments to lapse Aug. 1, and negotiations to extend them were mired in partisan gridlock, with the

White House and Democrats miles apart.

The Democratic congressional leaders Trump criticized and insulted with nicknames in remarks ahead of signing the orders, House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer, dismissed Trump’s actions as “meager” in the face of economic and health crises facing Americans. Trump’s Democratic opponent in the presidential race, Joe Biden, said the president had issued “a series of half-baked measures” and accused him of putting Social Security at risk.

The executive orders could face legal challenges questioning the president’s authority to spend taxpayer dollars without the express approval of Congress. Trump had largely stayed on the sidelines during the administration’s negotiations with congressional leaders, leaving the talks on his side to chief of staff Mark Meadows and Treasury Secretary Steven Mnuchin.

Trump’s embrace of executive actions to sidestep Congress ran in sharp contrast to his criticism of former President Barack Obama’s use of executive orders on a more limited basis. And the president’s step-back from talks with Congress broke with his self-assured negotiating skills.

Trump, who has not spoken with Pelosi since last year, sought to play the role of election-year savior, with the $400 weekly assistance, as well as a deferral of payroll tax and federal student loan payments and the continuation of a freeze on some evictions during the crisis.

“It’s $400 a week, and we’re doing it without the Democrats,” Trump said, asking states to cover 25% of the cost. Trump is seeking to set aside $44 billion in previously approved disaster aid to help states maintain supplemental pandemic jobless benefits, but Trump said it would be up to states to determine how much, if any of it, to fund, so the benefits could be smaller still.

Many states already faced budget shortfalls due to the coronavirus pandemic and would have difficulty assuming the new obligation. The previous unemployment benefit was fully funded by Washington.

Democrats had said they would lower their spending demands from $3.4 trillion to $2 trillion but said the White House needed to increase its offer. Republicans had proposed a $1 trillion plan.

White House aides watched the talks break down with apprehension, fearful that failure to close a deal could further damage an economic recovery already showing signs of slowing down.

The president’s team believes the economy needs to stabilize and show signs of growth for him to have any chance at winning re-election. Aides were hoping to frame the executive orders as a sign that Trump was taking action in a time of crisis. But it also would reinforce the view that the president, who took office declaring he was a dealmaker, was unable to steer the process to an agreement.

Trump said the employee portion of the payroll tax would be deferred from Aug. 1 through the end of the year. The move would not directly aid unemployed workers, who do not pay the tax when they are jobless, and employees would need to repay the federal government eventually without an act of Congress.

In essence, the deferral is an interest-free loan that would have to be repaid. Trump said he’ll try to get lawmakers to extend it, and the timing would line up with a postelection lame-duck session in which Congress will try to pass government funding bills.