President TrumpDonald John TrumpJoe Arpaio loses bid for his old position as sheriff Trump brushes off view that Russia denigrating Biden: ‘Nobody’s been tougher on Russia than I have’ Trump tees up executive orders on economy but won’t sign yet MORE on Saturday signed executive orders to extend unemployment benefits, suspend payroll taxes, and offer federal eviction and student loan relief, taking unilateral action that is on shaky legal ground amid stalled negotiations about a fifth round of coronavirus relief in Congress.
The president announced the slew of executive actions from his private club in Bedminster, N.J., where he is spending the weekend after lawmakers on Capitol Hill were unable to reach an agreement with White House negotiators.
The president was not physically present for any of the talks over the last few weeks, but has said he received regular updates from his staff.
One executive order extends the enhanced unemployment benefits that expired roughly two weeks ago and have been critical to millions of Americans out of work due to the pandemic. The benefits will be lowered from $600 to $400 per week, with states required to cover 25 percent of the cost, Trump said.
Another order directs the Treasury Department to allow employers to defer payment of employee-side payroll taxes through the end of 2020 for Americans earning less than $100,000 annually. The holiday is expected to be retroactive to Aug. 1, Trump said, adding that he hoped to forgive the deferred payroll taxes and make permanent payroll tax cuts if he is reelected in November.
“If I win, I may extend and terminate,” Trump said. “In other words, I’ll extend it beyond the end of the year and terminate the tax.”
Two additional orders put a freeze on evictions in federal housing and pause student loan payments through the end of the year.
“Through these four actions my administration will provide vital relief to Americans struggling during this difficult time,” Trump said, reading from prepared remarks.
Experts have questioned Trump’s authority to unilaterally intervene on unemployment benefits and the payroll tax, and his actions on Saturday may face legal challenges. But Trump shrugged off the legality of the orders when asked about it late Friday.
“I mean, everything you do you get sued,” he said. “So we’ll see. Yeah, probably we get sued, but people feel that we can do it.”
Trump signed the orders from a ballroom at his private club, where members looked on for a second straight day. The crowds appeared to violate social distancing guidelines in New Jersey, though most onlookers wore masks.
Treasury Secretary Steven MnuchinSteven Terner MnuchinTrump tees up executive orders on economy but won’t sign yet Overnight Health Care: Trump to take executive action after coronavirus talks collapse | Vaccine official says he’d resign if pressured politically Coronavirus talks collapse as negotiators fail to reach deal MORE and White House chief of staff Mark MeadowsMark Randall MeadowsTrump tees up executive orders on economy but won’t sign yet On The Money: Five takeaways from the July jobs report Overnight Health Care: Trump to take executive action after coronavirus talks collapse | Vaccine official says he’d resign if pressured politically MORE told reporters Friday that they would recommend Trump move forward with executive actions over the weekend, following what was described by both sides as an unproductive meeting with House Speaker Nancy PelosiNancy PelosiDemocratic convention lineup to include Ocasio-Cortez, Clinton, Warren: reports Trump tees up executive orders on economy but won’t sign yet New postmaster general overhauls USPS leadership amid probe into mail delays MORE (D-Calif.) and Senate Minority Leader Charles SchumerChuck SchumerPostal Service says it lost .2 billion over three-month period A three-trillion dollar stimulus, but Charles Schumer for renewable energy — leading businesses want to change that Democrats try to force Trump to boost medical supplies production MORE (D-N.Y.).
The president had for days teased that he was prepared to sign the executive orders, raising questions about whether it was merely a negotiating tactic. But White House officials viewed the unilateral action as a way for Trump to take action and distinguish himself from the dysfunction on Capitol Hill.
The White House and congressional Democrats have remained unable to come to an agreement on the next stimulus package, and both sides have pointed fingers at the other over the stalemate.
Republicans have balked at the price tag of Democrats’ proposal — the House passed a $3.4 trillion measure back in May — and opposed the amount requested for cash-strapped state and local governments. Democrats said they offered to reduce the price of their proposal by $1 trillion but were rebuffed by the Trump administration negotiators.
Trump, who has made the economy a central focus of his reelection effort, began signaling over the past week that he was prepared to act unilaterally on economic priorities should the virus relief talks stall. In a tweet Friday evening, he accused Pelosi and Schumer of only being interested in “Bailout Money for poorly run Democrat cities and states” and declared that he would be going “a different way.”
Trump’s action followed the release of Labor Department figures showing that the U.S. added 1.8 million jobs during the month of July and saw a decline in the unemployment rate to 10.2 percent. The figures exceeded expectations, however, economists have underscored the need for more federal assistance in order to aid the ailing economy.
Trump has been pushing for a payroll tax cut for months.
The White House argued that a payroll tax cut would provide incentives for workers to get back to work and reward individuals who stayed at work during the coronavirus pandemic, while cutting the cost of business.
However, both Republicans and Democrats in Congress have been cool to the idea. Critics of the idea say it wouldn’t do anything to help people who are unemployed, and they note that payroll tax revenue goes to the Social Security and Medicare trust funds.
Employees and employers each pay Social Security payroll taxes of 6.2 percent of wages and Medicare payroll taxes of 1.45 percent of wages.
Congress has already taken some steps to provide some payroll tax relief for employers. Trump signed legislation in March that allows employers to defer paying Social Security taxes and creates a payroll tax credit for businesses that continue to pay workers wages and health benefits. Lawmakers on both sides of the aisle are interested in expanding the credit.
Joe Bishop-Henchman, vice president of tax policy and litigation at the right-leaning National Taxpayers Union Foundation, said in a paper released Friday that “there are many potential legal challenges associated with a unilateral Presidential payroll tax suspension.” And he said that even if it were clear that Trump has the legal authority to suspend payroll taxes by executive action, such a move would raise questions for businesses.
“Without detailed answers to some of these questions, employers might just steer clear of all of it by continuing to do what they’ve always done, blunting the desired economic impact of reducing taxes,” Bishop-Henchman wrote. “A payroll tax delay or reduction might be worthy of consideration as a way to reduce the tax burden associated with employment, but its path would be infinitely clearer if it was mapped out by Congress in statute rather than in an executive order”
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