December 5, 2020

Editorial: How Trump’s economic strategy mirrors his pandemic response

President Trump’s unilateral cancellation of bipartisan economic stimulus talks was such a bad idea that even he tried to disown it. Hours after he ordered his subordinates via Twitter to “stop negotiating until after the election,” prompting a stock market sell-off, the president awkwardly demanded an immediate resumption of federal aid to businesses and individuals — two chief goals of the negotiation he had just ended.

Being after 10 p.m. with less than a month left until the election, it wasn’t just too late for the president to be making or unmaking major economic policy on the internet. It was too late to erase the impression that his answer to Americans facing unemployment and bankruptcy is the same as his prescription for the coronavirus: Tough it out.

Trump’s inscrutable stimulus strategy also parallels his mishandling of the pandemic in doubling as a gross disservice to the country and a grievous self-inflicted political wound. The president’s Democratic nemesis, House Speaker Nancy Pelosi, has endlessly offered him a means of providing desperately needed assistance to the country’s people and businesses. Yet Trump, on the brink of a troubled re-election attempt, lacks the sense to say yes.

Despite record spending in the early days of the pandemic, Congress hasn’t passed federal stimulus legislation since April. An expansive bill approved by House Democrats in May, which would have more than doubled the $3 trillion of stimulus to date, has received only halting and intermittent responses from the Senate and the administration.

In the meantime, supplemental unemployment payments and emergency business assistance have run out. California and other states received about as much aid from this stimulus as they did from the far smaller 2009 stimulus, and they have struggled to restart economies without touching off new waves of infection.

A failure to provide more federal aid would blow an $11 billion hole in California’s current budget, forcing cuts to schools, universities and courts. In cutting off talks, Trump reiterated his disdain for coming to the assistance of “Democrat States,” but the public-sector layoffs already under way will not hew to the partisan divide.

Neither does support for further aid. Among those who have called for another round of stimulus in short order is Trump’s own Treasury secretary, Steven Mnuchin, who was in negotiations with Pelosi when the president cut them off. The Trump-appointed Federal Reserve chairman, Jerome Powell, said Tuesday that insufficient stimulus threatens to further slow an unfinished recovery and cause “unnecessary hardship for households and businesses.” And a poll released last week showed that 80% of Americans, including 75% of Republicans, support more relief.

Such figures cast a dim light on Trump’s promise, in the course of ruling out pre-election aid, to bring forth “major” stimulus legislation “immediately after I win.” At this rate, he will get no such opportunity.

This commentary is from The Chronicle’s editorial board. We invite you to express your views in a letter to the editor. Please submit your letter via our online form: SFChronicle.com/letters.

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