Executive orders spark confusion

Trump relief effort called unworkable

“It's a Band-Aid on an open wound.” Trump “can do it, legally, but to provide real lasting relief he needs help from Congress — and if anything, he made that less likely yesterday.” DANIEL HEMEL, LAW PROFESSOR AT THE UNIVERSITY OF CHICAGO

Washington — President Donald Trump’s new executive actions to disburse coronavirus relief without Congress sparked confusion and frustration Sunday among businesses, Democrats and state officials, some of whom lamented the moves would not deliver the necessary relief to cashstrapped Americans.

Trump’s directives were aimed at offering new unemployment benefits, protecting renters from eviction and postponing the payment of a federal tax. But an array of economists and lawmakers depicted these policies as incomplete, unworkable or legally questionable — raising the prospect that the president’s attempt to boost

the economy may have a muted impact.

One of the orders allows employees making less than $104,000 to delay until January payment of a payroll tax that funds Social Security and Medicare. Trump added that he would try to change federal rules next year to make the deferred payments into a permanent tax cut — but only if he is reelected.

The tax typically is taken out of paychecks by employers. And businesses, payment processors and economists signaled Sunday, in the absence of a guarantee that the payroll taxes actually will be absolved, businesses would be unlikely to alter worker paychecks.

“It’s a little bit of a leap of faith on an employer’s part,” said Pete Isberg, the vice president of government affairs for ADP, which processes payments for 40 million workers and 800,000 businesses.

Isberg said it may take months for some businesses to implement a system that can defer payroll taxes for a few months, delaying any potential boost to the economy. “It’s not clear employers broadly will adopt this,” he added. “It’s not clear employees will want to take it even if they qualify.”

Unable to swing a deal with Democrats, Trump resorted to executive actions as concerns in Washington intensified about the economic distress — and the political fallout — caused by the pandemic.

“The Lord and the Founding Fathers created executive orders because of partisan bickering and divided government,” White House economic adviser Peter Navarro said Sunday on NBC.

But Trump’s attempts to circumvent the partisan logjam on Capitol Hill instead may be illustrating the limits of executive power — and the costs that can come from invoking it. In this case, a more long-lasting legislative solution may have been delayed with the White House deciding to act on its own, said Daniel Hemel, a law professor at the University of Chicago in an interview.

“It’s a Band-Aid on an open wound,” he said Sunday. Trump “can do it, legally, but to provide real lasting relief he needs help from Congress — and if anything, he made that less likely yesterday. Most of us won’t see more money in our paychecks, and the millions of families on unemployment will still be in crisis come September.”

The coronavirus pandemic has had a devastating impact on the U.S. economy, forcing many businesses to close and lay off workers. Certain sectors, particularly travel, hospitality and retail, have been hit particularly hard. The country has more than 30 million Americans collecting unemployment insurance and has not rehired half the workers who had lost jobs by the end of April, a fact White House officials acknowledged Sunday.

Democrats pounced on the confusion from Trump’s executive directives, arguing that the White House should resume negotiations on a broader relief package. Those talks had collapsed last week after both sides dug in on what they believed the package should entail and how much it should cost.

The stalemate resulted in the expiration of a critical economic lifeline to millions of Americans — an extra $600 each week in unemployment benefits that Congress approved in March.

“Unfortunately, the president’s executive orders, described in one word, could be paltry, in three words, unworkable, weak, and far too narrow,” Senate Minority Leader Chuck Schumer, D-N.Y., said Sunday on ABC.

In response to the expiring aid, Trump on Saturday signed an order that would offer $400 a week in federal unemployment benefits. To pay for the program, the president said he would tap $44 billion in federal funds that are allocated for relief during natural disasters such as a hurricane or wildfire.