Trump tells his team to end stimulus negotiations until after the election
- President Donald Trump announced in a Tuesday tweet that he told his team to end stimulus negotiations until after the election.
- He accused Democrats of "not negotiating in good faith" and rejected their spending proposal.
- Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi were in the middle of negotiations that restarted in late September after collapsing in August.
President Donald Trump abruptly announced on Tuesday that he ordered Treasury Secretary Steven Mnuchin to end stimulus negotiations with Speaker Nancy Pelosi until after the election in November, scrapping aid talks as the economy displays new signs of weakness.
The president's statement came in several tweets less than a day after he was discharged from Walter Reed National Military Medical Center despite still having COVID-19. He has downplayed the disease's impact on his health.
"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," Trump wrote on Twitter.
—Donald J. Trump (@realDonaldTrump) October 6, 2020
"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," he said. "We made a very generous offer of $1.6 Trillion Dollars and, as usual, she is not negotiating in good faith."
He added that he was "looking to the future of our Country" and that he had told Senate Majority Leader Mitch McConnell to instead focus on confirming his Supreme Court nominee, Judge Amy Coney Barrett.
Stocks fell sharply after Trump's unexpected announcement, with the Dow Jones industrial average dropping 376 points for the day. The S&P 500 also closed lower.
The president's comments sharply diverged from the policy recommendations of Federal Reserve Chair Jerome Powell. He said in a speech earlier on Tuesday more federal spending was needed to shore up the economy.
Trump's statement also represented a remarkable shift in his position on a coronavirus aid package from only two days ago; on Saturday, he tweeted that the US needed another federal rescue package and put the onus on Congress.
"OUR GREAT USA WANTS & NEEDS STIMULUS. WORK TOGETHER AND GET IT DONE. Thank you!," he wrote.
In recent weeks, pressure has mounted on Congress to forge a new economic relief package. Millions of Americans are out of work and struggling to afford food and rent after the pandemic devastated the economy earlier this year, causing job losses and bankruptcies.
Many economists have prodded lawmakers to support additional spending and prop an economy undergoing a shaky recovery as job growth slows and permanent layoffs rise. The US has only regained about half the jobs it lost in March and April.
About 26.5 million Americans are currently receiving unemployment benefits, drawing between 30% to 50% of their past wages. Experts say many jobless people could face significant hardship in the coming weeks if the federal government doesn't step in and supplement their state benefits.
"It'll mean more people dropping into poverty and making terrible choices between rent, medicine, and food on the table," said Heidi Shierholz, policy director at the left-leaning Economic Policy Institute.
Some conservative economists struck a different tone. Steve Moore, an outside economic advisor to the White House, assailed the $600 federal unemployment benefits and $436 billion in state aid that Democrats were seeking.
"I am proud of the president for not paying the ransom Pelosi was demanding," he told Business Insider. "She was a hostage-taker."
Moore had advised the president against signing onto a stimulus package in late September, arguing its benefits wouldn't materialize until next year.
Republicans and Democrats haven't approved additional aid since the spring when they injected over $3 trillion in aid, the largest chunk coming from the CARES Act in March. Since then, both parties have been fiercely divided on the amount of federal spending needed to keep individuals and businesses afloat.
House Democrats last week passed a $2.2 trillion spending plan — a slimmed-down version of a $3.4 trillion bill they passed in May — that would restore the $600 weekly federal unemployment benefit, provide aid to states and businesses, and send another round of direct payments to Americans.
The Trump administration sought a $1.6 trillion coronavirus aid package, $700 billion less than what Democrats wanted. Both sides, however, appeared to be making progress on a deal to include more stimulus checks, as well as federal unemployment benefits, and small business aid.
Mnuchin and Pelosi were in the middle of negotiations that restarted in late September after collapsing in August. In a letter to Democrats, Pelosi tore into Trump's decision to call off the talks and called it "an act of desperation."
"Today, once again, President Trump showed his true colors: putting himself first at the expense of the country, with the full complicity of the GOP members of Congress," she said.
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