Marysville Appeal-Democrat

Standoff on U.S. virus relief package leaves damage all around

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There were plenty of casualties left in the rubble of failed negotiatio­ns on another trillion-dollar-plus rescue package for a U.S. economy mired in a historic, pandemic-induced recession.

Worst hit are the families, businesses, and state and local government­s that have had a safety net pulled out from under them at a time some data suggest that recent gains in employment may be transitory as the continuing spread of COVID-19 infections forces a retrenchme­nt.

In Washington, the political damage is widespread. But the biggest impact may be on President Donald Trump.

The president on Saturday took some modest steps to try to mitigate the economic impact _ diverting disaster money to boost unemployme­nt insurance, and suspending collection of payroll taxes for some workers.

Trump said his actions “will take care of, pretty much, this entire situation.” But many economist disagree, and even his own top aides have admitted they’re no substitute for a legislativ­e deal.

One thing Trump’s response didn’t do was spark an immediate return to the bargaining table. Treasury Secretary Steven Mnuchin said Sunday the administra­tion would listen to any proposal put up by Democrats. House Speaker Nancy Pelosi, asked on CNN whether talks would resume after two weeks of fruitless negotiatio­ns with the White House, offered only, “I hope so.”

Trump said Sunday night that Democrats have contacted the administra­tion “and want to get together” and may be more inclined now to negotiate. Two Democratic congressio­nal aides said Pelosi and Senate Democratic leader Chuck Schumer have had no contact with the White House since Friday. No new talks have been scheduled.

The biggest driver for a deal may be the reaction of financial markets and the business community in the coming days. Stocks in Asia markets opened mixed as investors weighed uncertaint­y over more stimulus.

Despite a report showing the U.S. added 1.76 million jobs in July, the economic situation remains more dire than the depths of the last recession _ when unemployme­nt reached a peak of 10%. Further job gains look increasing­ly difficult with large parts of the economy hobbled.

High-frequency indicators show that economic and payroll activity slowed or declined in the weeks following the survey period for the government’s July jobs report. More than a million workers are filing new unemployme­nt insurance claims every week, and more than half of unemployed Americans have now been without a job for more than 16 weeks, according to the Labor Department.

Meanwhile, almost 30 million Americans said they didn’t have enough to eat in the week ended July 21, the U.S. Census reported.

Voters historical­ly pin the state of the economy on the president. Trump, who campaigned as the consummate dealmaker, has repeatedly forecast a quick rebound from the COVID-19 pandemic. Now, by taking a unilateral action and touting its benefit, he’s tied himself more closely to the state of the economy come November.

Some voters may see Trump as taking charge while Congress bickers. Any benefit may be short-lived if the economy remains staggered in the weeks leading up to the election.

Between the government’s pandemic response and the faltering economy, Trump trails Democrat Joe Biden in every recent poll nationally and in electoral battlegrou­nd states. At a time when fewer Americans are splitting their ballot between political parties, that also presents a danger to congressio­nal Republican­s, who are at serious risk of losing their Senate majority.

An extended standoff risks pushing the stimulus negotiatio­ns into September when Congress will be wrangling over keeping the government funded and running when the new fiscal year starts Oct. 1

The failure to get a deal has dented the reputation­s of some of Washington’s other would-be deal makers.

White House Chief of Staff Mark Meadows, the architect of multiple fruitless government shutdown fights when he headed the House Freedom Caucus, underestim­ated Democrats’ resolve early on, and pushed for a small-ball deal few in either party liked. Mnuchin, meanwhile, has had to defend himself to Republican senators who suspect him of folding too quickly in negotiatio­ns on the last stimulus bill.

Pelosi and Senate Democratic leader Chuck Schumer made miscalcula­tions of their own.

“We have to come to an agreement. We have to meet half-way,” Pelosi said on “Fox News Sunday.”

 ?? Getty Images/tns ?? Banners against renters eviction reading no job, no rent is displayed on a controlled rent building in Washington, DC on Aug. 9.
Getty Images/tns Banners against renters eviction reading no job, no rent is displayed on a controlled rent building in Washington, DC on Aug. 9.

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