Politicians Play Chicken With Economic Relief While Americans Starve

Republicans and Democrats are prioritizing their own political fortunes over the wellbeing of millions.

Hadas Thier

U.S. Speaker of the House, Nancy Pelosi, Democrat of California, leaves after her weekly press briefing on Capitol Hill in Washington, DC, on October 8, 2020. (Photo by ANDREW CABALLERO-REYNOLDS/AFP via Getty Images

Eco­nom­ic relief from the Fed­er­al gov­ern­ment has run dry, with few prospects for its renew­al. And the results have been catastrophic.

"While Rome burns, Republicans and Democrats are playing a months-long game of chicken with stimulus bill negotiations."

Stim­u­lus pack­ages passed in the spring had pro­vid­ed an eco­nom­ic life­line to tens of mil­lions, but key pieces, includ­ing sup­ple­men­tary unem­ploy­ment ben­e­fits, expired by August. Now many of the 25 mil­lion peo­ple cur­rent­ly receiv­ing unem­ploy­ment aid are not col­lect­ing enough to cov­er rent, bills and gro­ceries. An esti­mat­ed 30 to 40 mil­lion peo­ple are fac­ing evic­tion in the com­ing months, dur­ing a pan­dem­ic that requires stay­ing home for safe­ty. Last week, researchers report­ed that 8 mil­lion peo­ple have fall­en into pover­ty since May, includ­ing 2.5 mil­lion children. 

But while Rome burns, Repub­li­cans and Democ­rats are play­ing a months-long game of chick­en with stim­u­lus bill nego­ti­a­tions. Our bil­lion­aire pres­i­dent and Con­gres­sion­al leg­is­la­tors, the major­i­ty of whom are mil­lion­aires, are more con­cerned with their own polit­i­cal gains than with the dire con­di­tions faced by an elec­torate they osten­si­bly represent.

In May, House Democ­rats passed a $3.4 tril­lion Heroes” relief pack­age, sum­mar­i­ly ignored by Sen­ate Repub­li­cans and the White House. Nego­ti­a­tions have since begun and then col­lapsed sev­er­al times. Most dra­mat­i­cal­ly, Pres­i­dent Don­ald Trump abrupt­ly called them off upon his return to the White House from Wal­ter Reed Nation­al Mil­i­tary Med­ical Center. 

Now, with eco­nom­ic recov­ery” stalled out and Trump’s chances of reelec­tion crum­bling, his twit­ter tune has changed from rejec­tion to Go big or go home!!!” The pres­i­dent is fac­ing the pos­si­bil­i­ty of a drub­bing on elec­tion day and los­ing Repub­li­can con­trol of the Sen­ate, and is increas­ing­ly des­per­ate to sign a new round of stim­u­lus pay­ments before Novem­ber 3

The lion’s share of respon­si­bil­i­ty for failed nego­ti­a­tions sure­ly lays at the Republican’s door, but the real­i­ty is that des­per­ate­ly need­ed eco­nom­ic relief is being treat­ed as a polit­i­cal foot­ball on all sides. While Trump’s elec­tion-day des­per­a­tion is prompt­ing go big” tweets, and Con­gres­sion­al Repub­li­cans cyn­i­cal­ly think ahead to ways to under­mine a Pres­i­dent Biden, the Democ­rats, for their part, are bet­ting on stalled nego­ti­a­tions to pro­vide the nail on Trump’s reelec­tion coffin. 

It’s tempt­ing to think that the Demo­c­ra­t­ic Par­ty lead­er­ship has final­ly grown a back­bone, or a sense of polit­i­cal prin­ci­ples, and is stand­ing up to the White House. Instead, Nan­cy Pelosi and con­gres­sion­al Democ­rats are using a moment in which Trump’s des­per­a­tion has giv­en them increased lever­age to fur­ther hob­ble the Repub­li­cans at the polls, even if it means risk­ing no deal at all. If nego­ti­a­tions don’t result in a deal by Novem­ber 3, it is unlike­ly that Trump (whether he wins or los­es) will have any moti­va­tion to pass anoth­er bill. In the prob­a­ble — but still not guar­an­teed — out­come of a Biden win, this would at best mean that eco­nom­ic relief won’t come until Feb­ru­ary. How many more mil­lions will have fall­en into pover­ty by then?

Dire straits

For 30 weeks in a row, the num­ber of new U.S. job­less claims has been shock­ing­ly high, unri­valed by any oth­er time since the Depart­ment of Labor start­ed keep­ing track in 1967. Begin­ning on March 21, 3.3 mil­lion peo­ple new­ly filed for unem­ploy­ment. That num­ber more than dou­bled to 6.8 mil­lion the fol­low­ing week. For con­text, dur­ing nor­mal” times, new week­ly claims typ­i­cal­ly hov­er around 210,000. The pre­vi­ous record for new week­ly claims was 665,000 dur­ing the Great Reces­sion. Now that states have reopened busi­ness­es, job­less claims over the last few months have come down from their ini­tial peak, but still hov­er near 900,000 per week, well above any­thing we’ve seen before the pandemic.

This unprece­dent­ed dis­as­ter was only mit­i­gat­ed by a pack­age of stim­u­lus bills passed in the spring. Four bills in March and April — includ­ing the largest and most well-known among them, the CARES Act — togeth­er ded­i­cat­ed almost $3 tril­lion in stim­u­lus spend­ing, pro­vid­ing a life­line for work­ers and the econ­o­my. The stim­u­lus bills were a mixed bag, which com­bined a sig­nif­i­cant finan­cial cush­ion for work­ing peo­ple and aid to small busi­ness­es with cor­po­rate slush funds and tax breaks for the rich. But what­ev­er their prob­lems, the bills tem­porar­i­ly ward­ed off dis­as­ter through the dis­burse­ment of $1,200 stim­u­lus checks” and by pro­vid­ing fed­er­al unem­ploy­ment ben­e­fits to sup­ple­ment woe­ful­ly inad­e­quate state ben­e­fits. These expen­di­tures were so effec­tive that per­son­al income actu­al­ly rose over 9% in April and May from this time last year.

Now the $1,200 checks have long since run dry, and fed­er­al unem­ploy­ment ben­e­fits expired in July — just as mass lay­offs and state bud­get cuts begin to hit, and the uptick of jobs recov­ery in the sum­mer has slowed to a crawl.

Pars­ing the drama

The lat­est White House pro­pos­al offers a $1.8 tril­lion bill, up from the ini­tial $1 tril­lion offer, and edg­ing clos­er to the Democ­rats’ $2.2 tril­lion pro­pos­al (itself down from the $3.4 tril­lion pro­pos­al in May).

The two sides both agree to addi­tion­al $1,200 stim­u­lus checks, more aid for small busi­ness­es, and a renew­al of fed­er­al unem­ploy­ment ben­e­fits (albeit at dif­fer­ent lev­els: Democ­rats pro­pose $600 as they had been in the spring, the White House has agreed to $400). The White House has also con­ced­ed to increased fund­ing for the Afford­able Care Act and has sig­naled that it may, too, sign on to a nation­al test­ing plan. How­ev­er, the administration’s pro­pos­al includes lia­bil­i­ty pro­tec­tions for busi­ness­es, and lim­it­ed spend­ing for state aid and child care tax credits.

Whether or not a deal is reached between Democ­rats and the White House, it’s unclear whether con­gres­sion­al Repub­li­cans will com­ply with their boss, now that he is falling behind bad­ly in the polls. Accord­ing to Wash­ing­ton Post reporters, mul­ti­ple GOP sen­a­tors denounced the pro­pos­al,” on a call with White House nego­tia­tors, attack­ing the price tag as too big, ques­tion­ing the over­all direc­tion and crit­i­ciz­ing indi­vid­ual pro­pos­als.” Sen­ate Major­i­ty Leader Mitch McConnell has advanced instead a nar­row $500 bil­lion bill that he says will come to the sen­ate floor next week. 

In part, the most con­ser­v­a­tive wing of the GOP is entrenched in anti-big gov­ern­ment prin­ci­ples and balk at the prospects of large stim­u­lus spend­ing. But in part many are read­ing the writ­ing on the wall of the dimin­ished prospects of a Trump reelec­tion, and are switch­ing tacks. As jour­nal­ist Greg Sar­gent not­ed, Repub­li­cans may already be lay­ing the ground­work to try to destroy a Joe Biden pres­i­den­cy, should he win the election.”

Direct, pub­lic crit­i­cism of Trump is still rare,” ana­lysts at Bloomberg News argue. GOP can­di­dates need his fer­vent­ly loy­al base in an elec­tion where Demo­c­ra­t­ic vot­ers are moti­vat­ed. Yet if they don’t try to cre­ate some dis­tance with the White House they ful­ly tie their fates to Trump.” Accord­ing to a GOP strate­gist, the arti­cle con­tin­ues, Repub­li­cans have been care­ful­ly lay­ing the ground­work to restrain a Biden admin­is­tra­tion on fed­er­al spend­ing and the bud­get deficit by talk­ing up con­cerns about the price tag for anoth­er round of virus relief. The think­ing, the strate­gist said, is that it would be very hard polit­i­cal­ly to agree on spend­ing tril­lions more now and then in Jan­u­ary sud­den­ly embrace fis­cal restraint.”

It shouldn’t be sur­pris­ing that Repub­li­can law­mak­ers are pre­emp­tive­ly set­ting their sights on ways to hob­ble a future Pres­i­dent Biden. Nor is it a new approach for them to go hard on an anti-deficit cam­paign, while simul­ta­ne­ous­ly sup­port­ing ongo­ing deficit-induc­ing tax cuts for the rich.

But the Democ­rats, too, need to stop play­ing chicken.

There is no doubt that the White House pro­pos­al falls short, and that a gen­uine­ly Left pro­pos­al would go much fur­ther than the Demo­c­ra­t­ic pro­pos­al as well. The $1,200 stim­u­lus check” is less than what social­ists and pro­gres­sives have called for, states and local ser­vices will need much greater sup­port, and of course we’re a long way from the kind of pro­pos­als that cli­mate activists have artic­u­lat­ed in the form of a Green Stim­u­lus.

In the short term, it makes sense for Democ­rats to con­tin­ue to push against cyn­i­cal lia­bil­i­ty pro­tec­tions, which could cost work­ers their lives. On oth­er items, the dis­tance between the two sides is now much small­er than it is made out to be. For instance, $300 bil­lion to states, ver­sus the Democ­rats’ $436 bil­lion. States, of course, need much more, as local bud­gets have cratered and cuts to edu­ca­tion and health care are already com­ing as a result.

But it is not dif­fi­cult to imag­ine a sce­nario in which Democ­rats could agree to a deal, while argu­ing open­ly and force­ful­ly that it is insuf­fi­cient. They could make the case pub­licly that the eco­nom­ic des­per­a­tion expe­ri­enced by mil­lions, along­side GOP intran­si­gence has forced them to agree to an incom­plete solu­tion, but that they will push for renewed and greater spend­ing if they win the upcom­ing elections. 

This may be a dis­ap­point­ing, but nec­es­sary, con­clu­sion for the time being. Just as labor nego­ti­a­tions are always con­strained by both struc­tur­al inequal­i­ty and sub­jec­tive orga­niz­ing pow­er, here too, we have to sober­ly assess the abil­i­ty of the Left to force a more far-reach­ing solu­tion with­in the next two weeks. We’re sim­ply not there. It will require more time, more orga­niz­ing, and more elect­ed offi­cials from with­in the ranks of our move­ment to put for­ward — and fight for — a more far-reach­ing pro­pos­al. In the mean­time, the eco­nom­ic imper­a­tive to return fed­er­al unem­ploy­ment ben­e­fits and stim­u­lus spend­ing is urgent, and it must move forward.

Hadas Thi­er is an activist and social­ist in New York, the author of A Peo­ple’s Guide to Cap­i­tal­ism: An Intro­duc­tion to Marx­ist Eco­nom­ics, and a reg­u­lar con­trib­u­tor to Jacobin Mag­a­zine. She tweets at @HadasThier.

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