By Nixing Stimulus Negotiations, Trump Is Immiserating Tens of Millions of People

Just how cruel, heartless, and cold-blooded is Donald Trump’s decision to halt negotiations over a new stimulus package? Last night, the top post on Reddit’s unemployment tag included suicide prevention hotline numbers.

US president Donald Trump salutes Marine One helicopter pilots after returning to the White House from Walter Reed National Military Medical Center on October 5, 2020 in Washington, DC. (Win McNamee / Getty Images)

Within twenty-four hours of being airlifted back to the White House from Walter Reed National Military Medical Center, still infectious and highly medicated, Donald Trump returned to his favorite pastimes of immiserating workers and writing streams of contradictory Twitter rants. On Tuesday, he declared negotiations over further stimulus spending dead, and with it any chance of relief for the tens of millions of people who are out of work, going hungry, and at risk of homelessness.

The announcement came abruptly via Twitter:

Nancy Pelosi is asking for $2.4 Trillion Dollars to bailout poorly run, high crime, Democrat States, money that is in no way related to COVID-19 . . . I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business. I have asked @senatemajldr Mitch McConnell . . . to instead focus full time on approving my outstanding nominee to the United States Supreme Court, Amy Coney Barrett.

For good measure, Trump ended with his signature exclamations: “Our Economy is doing very well. The Stock Market is at record levels, JOBS and unemployment also coming back in record numbers. We are leading the World in Economic Recovery, and THE BEST IS YET TO COME!”

The speed and intensity of Trump’s changing position led some to speculate about the effects of his steroid medications. Three days earlier, at Walter Reed, he had tweeted: “OUR GREAT USA WANTS & NEEDS STIMULUS. WORK TOGETHER AND GET IT DONE. Thank you!” And hours after calling off negotiations, he fired off a tweetstorm calling for stand-alone bills to provide relief via stimulus checks and an airline bailout.

The reason behind Trump’s oscillations is probably more banal than drugs: cold political calculation, mixed with the need to clean up the political (and stock-market) fallout he’s created. Trump canceled negotiations after being briefed by GOP leaders and hearing that many in the party’s most conservative wing had balked at any stimulus bill that went beyond a few crumbs. It’s possible that a deal between the White House and Democrats would have caused a mutiny within the Republican Party or failed to receive enough votes to pass.

Nancy Pelosi and congressional Democrats, too, are seemingly motivated by the (likely shrewd) calculation that failed negotiations will do the most harm to Trump and GOP election prospects. Consider one of the main sticking points in negotiations: aid for state and local governments. Pelosi called for $400 billion and the White House $250 billion. The difference of $150 billion is chump change for the US government.

Now talks have stalled until at least November, in a worst-case scenario of a Trump victory, and until January, assuming a victory for Joe Biden. The human consequences are dire. With nearly 30 million unemployed, an equal or greater number facing eviction in the coming months, and 14 million children without enough to eat, it is heartbreaking but not surprising that the top post on Reddit’s unemployment tag last night provided suicide prevention hotline numbers. “I know how we are all feeling today,” the poster wrote, “but it’s not worth it.”

In the spring, the package of stimulus bills provided a lifeline for workers and the economy. It muted a recessionary spiral (in which households and businesses cut back on spending, leading to a cratering of demand, and therefore further layoffs and tightening of credit from banks and lenders). But the bipartisan commitment to holding the economy together dissolved this summer, as Republicans came to favor reopening states rather than stimulus spending as a means to jump-start the economy.

Trump’s delusions of a “super V” recovery notwithstanding, only half of the jobs lost in the spring have returned, and whether they will stay remains unclear. Meanwhile, permanent job losses are growing, and disposable income has fallen off a cliff since August. With the federal moratorium on evictions expired, countless numbers of people are facing homelessness, amid a pandemic that requires staying at home for safety.

Worse still, we’re only in the opening stages. As the Washington Post reported this week:

Companies from airlines to energy firms to restaurants have warned in recent days that they will have to undertake massive layoffs without more government aid. At least 75,000 layoffs were announced by major corporations at the end of last week alone . . . Overall, 21 percent of small businesses warn they will have to shut permanently if something doesn’t change in the next six months, according to a National Federation of Independent Business survey in August.

State budgets are in crisis — government and education job losses have already started — and the long-term consequences of public-sector cuts will be dire. Unemployment benefits have been halved since they expired in the summer, leaving unemployed people without the means to pay rent, pay bills, or buy groceries. Without another stimulus, a recessionary spiral will set in, wreaking still greater havoc on our lives.

If all of this happened in a poorer country — the president holding up a deal desperately needed by tens of millions of people until after he “won” the election — the US press would call it clientelism. But in Trump’s America, it’s just another day in the life of a crooked and heartless White House.