Trump signs virus aid order after talks collapse

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US President Donald Trump shows signed executive orders for economic reliefImage copyright

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The president spoke to reporters on Saturday from his golf club in New Jersey

US President Donald Trump has taken executive action to provide economic aid to millions of Americans hit by the pandemic, saying he was forced to do so after talks at Congress broke down.

The directives include measures to support the unemployed, suspend payroll tax and extend student loans.

Some of them are likely to face legal challenges given that Congress controls federal spending, not the president.

Democratic rival Joe Biden said they were “a series of half-baked measures”.

It is not known whether the move will mean the end of talks between senior government officials and top Democrats for a stimulus package. Negotiations broke down on Friday after two weeks.

Mr Trump said the measures would provide up to $400 (£306) per week in supplemental unemployment benefits to tens of millions of jobless Americans. This is less than the $600 people had been receiving until 31 July, when the benefit expired.

The president also said states would cover 25% of the new payments – the previous benefit was fully funded by the federal government. He is seeking to divert money from a previously approved disaster aid to states.

Mr Trump said it would be up to the states, which already face huge budget shortfalls due to the pandemic, to determine how much to be used from that fund to pay for the benefit. This means that the extra payment may end up amounting only to $300 a week.

“This is the money they need, this is the money they want, this gives them an incentive to go back to work,” President Trump said of the lower payments during a news conference on Saturday from his golf club in Bedminster, New Jersey.

The measures also included a suspension of the collection of payroll taxes – which pay for Social Security and other federal programmes – through to the end of this year, a suspension of federal student loan payments, and efforts to minimise evictions but not a moratorium.

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Media captionDespite the economy shrinking, US stocks have rallied

The Democratic-controlled House of Representatives had approved a $3.5 trillion package which was rejected by the Republican-held Senate.

House Speaker Nancy Pelosi, the most powerful elected Democrat, said they lowered the figure in talks to $2tn but Republicans had proposed a $1tn plan.

Mrs Pelosi and Senate Minority Leader Chuck Schumer dismissed the president’s actions as “meagre”, saying they were “unworkable, weak and narrow policy announcements” in the face of the economic and health crises.

Mr Biden, President Trump’s rival in the November election, accused him of putting Social Security “at grave risk” by delaying the collection of payroll taxes, and called the measures “another cynical ploy designed to deflect responsibility”.

But Republican Senate Majority Leader Mitch McConnell said he supported the president “exploring his options to get unemployment benefits and other relief to the people who need them the most.”

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Millions of unemployed Americans were benefited by the extra benefits

The US unemployment rate continued to fall in July, but it was a much lower decrease than in May and June, denting hopes of an economic revival.

The country’s death toll from the coronavirus pandemic has surpassed 160,000. The US has far more Covid-19 cases by volume than any other country – nearly five million – and its rate of infection has risen steadily throughout the summer.

Congress has already allocated some $3tn for pandemic relief so far. Some Republicans in Congress do not wish to spend any more, and nearly half of Republican senators say they would oppose any new relief bill at all.

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