'We're Not Budging': Pelosi Digs In on Covid Relief

Plus, Trump's payroll tax plan faces delays  [The Fisc](   By Yuval Rosenberg and Michael Rainey 'We're Not Budging': Pelosi and Meadows Make No Progress on Covid Relief House Speaker Nancy Pelosi and White House Chief of Staff Mark Meadows resumed talks on a coronavirus relief package on Thursday, but their 25-minute afternoon phone call failed to produce any progress in breaking a weeks-long impasse. Pelosi said afterward that she told Meadows Democrats would be willing to meet halfway, splitting the difference between their $3.4 trillion proposal and the White House’s offer of about $1 trillion. "We have said again and again that we’re willing to meet them in the middle — $2.2 trillion. When they’re willing to do that, we’ll be willing to discuss the particulars," Pelosi [told reporters](. In a statement released after the call, Pelosi said the funding Democrats are insisting on would help combat the coronavirus and boost the economy. "This conversation made clear that the White House continues to disregard the needs of the American people as the coronavirus crisis devastates lives and livelihoods," she said. "The Administration’s continued failure to acknowledge the funding levels that experts, scientists and the American people know is needed leaves our nation at a tragic impasse." Earlier in the day, Pelosi told reporters that Democrats aren’t willing to go any lower. "We’re not budging," she said. McConnell says the country needs another coronavirus bill: "We need another one, the country needs another one," Senate Majority Leader Mitch McConnell (R-KY) reportedly said of a coronvirus package during a visit to a hospital in Pikeville, Kentucky. The Associated Press’s Lisa Mascaro [reports]( that "McConnell faces his own difficulties because many, if not most, GOP senators appear satisfied, for now, that there remains enough existing aid available and new money is not needed. The split in his ranks gives Pelosi an upper hand in talks because she has been able to bring most of her Democrats on board with her proposals." The bottom line: Congress remains on recess until September and Meadows said this week he’s "not optimistic" about reaching a deal before the end of next month, when a relief package could be combined with talks on must-pass funding to prevent a government shutdown. Thursday’s talks did nothing to change that. Quote of the Day "To watch these people who never have to worry about a dollar in their lives go on vacation for a month without even thinking about the fact that people are going to be homeless and dead at the end of it, because they want to take their vacation, it’s crushing." – Madeleine Olson, a 27-year-old Michigan resident who lost her job in March, quoted in a [Washington Post story]( about the anger and bewilderment felt by many jobless workers after Congress and the White House let enhanced unemployment payments of $600 a week expire at the end of last month. The Post spoke to 20 such people. "Every person interviewed said they were furious at Washington policymakers for letting such a critical benefit lapse amid the nation’s worst economic crisis in a century. Often, the anger was directed at Republicans, who control the White House and the Senate, although a few credited President Trump for at least trying to take action on his own," the Post’s Eli Rosenberg and Heather Long report. Trump’s Payroll Tax Plan Is Hung Up in a Dispute With the IRS: Report President Trump’s effort to suspend employee Social Security taxes starting September 1 is hung up over a dispute over who should be responsible for making the tax payments once the suspension is over at the end of the year. According to [Bloomberg News]( the White House wants employers to be on the hook for paying the suspended payroll taxes, not employees. The IRS, however, says that both employers and employees would be responsible and subject to collections efforts. The dispute between the White House and the Treasury Department over the issue has delayed the publication of guidelines that businesses say they need to decide whether to participate in the program. Many companies have expressed concerns about delaying tax bills until next year, and last week the U.S. Chamber of Commerce said the plan is "unworkable." Eliminate the suspended taxes? Top White House economic adviser Larry Kudlow said last week that the Trump administration is considering forgiving the payroll tax of 6.2% that employees pay to help fund Social Security. The taxes "essentially can be forgiven if you stretch it out five years, eight years," Kudlow said. Trump has also said that he would urge Congress to forgive the taxes if he wins a second term, though few believe that lawmakers would embrace the idea. Few companies expected to participate. The tax suspension was already a bit rushed, and the delay in providing guidance means that few companies are expected to start suspending payroll taxes when the program begins next month. "It’s unlikely that many employers will be able to make the programming changes by September 1," Pete Isberg of the payroll processing firm ADP told [Fox Business](. "We’ve advised Congress and Treasury that anything like this normally requires at least six months for an orderly programming transition." Companies wary of the proposed program may be relieved that the delay is making the whole thing easier to avoid. "The fact that there hasn’t been guidance is, in some ways, a positive for a lot of clients who really were not looking forward to having to deal with it," tax attorney Adam B. Cohen of Eversheds Sutherland LLP told Bloomberg. Unemployment Claims Drop, but Still Above 1 Million New jobless claims dropped last week, the Labor Department said Thursday, with just over 1 million people filing for state unemployment benefits on a seasonally adjusted basis. Another 607,000 filed for claims for Pandemic Unemployment Assistance, a program that provides aid for gig workers and the self-employed. The report marked the 23rd week in a row that new jobless claims exceeded the previous pre-pandemic weekly high, set in 1982. Overall, about [27 million]( people are receiving some kind of unemployment aid. Many economists noted that, even though they are gradually improving, the job loss numbers continue to be extraordinarily high by historical standards, which suggests that the job market could be experiencing significant long-term damage. "Even as businesses have reopened and jobs have returned, layoffs are ongoing reflecting interruptions to activity from virus containment that are likely resulting in permanent closures and job losses," Rubeela Farooqi, chief U.S. economist at High Frequency Economics, said in a report. "The risk of permanent damage to the labor market remains high which will slow the pace of recovery." Fiscal Flashes 12 Million Have Lost Employer-Sponsored Health Insurance: More than 6 million people have lost their employer-sponsored health insurance due to job losses since the coronavirus epidemic struck, according to new research from the Economic Policy Institute. The researchers estimate that for every person who loses their insurance, another person, typically a spouse or child, loses their coverage as well, bringing the total to roughly 12 million. It’s not clear how many of those have received coverage from alternative sources such as family members, Medicaid or Obamacare, but the researchers said it is unlikely that all have found new sources of insurance. ([CBS News]( Trump to Announce $750 Million Deal for Rapid Covid Tests: In his acceptance speech at the Republican National Convention Thursday evening, President Trump is reportedly set to announce a $750 million deal to have the government by 150 million rapid Covid-19 tests from Abbot Laboratories. The Food and Drug Administration granted emergency-use authorization Wednesday for the company’s $5 Covid-19 antigen test, called BinaxNOW, which provides results in about 15 minutes. The tests could be used in doctor’s offices, nursing homes and schools, among other areas. "This is a major development that will help our country to remain open, get Americans back to work and kids back to school," White House senior adviser Alyssa Farah said in a statement. ([Politico]( [CNBC]( Trump’s ‘All-Out Attack’ on the FDA: President Trump has launched a crusade against the Food and Drug Administration, one that officials inside the agency and experts outside it worry may permanently damage its credibility. Trump on Saturday accused the FDA of being part of a "deep state" conspiracy to harm his reelection campaign, and others in the White House have publicly criticized the agency. Senior FDA officials also worry about the appointment of Emily Miller, a gun-rights activist and former correspondent for the far-right One America News Network, as the agency’s top spokesperson, "empowering her to aggressively reshape the FDA’s typically nonpolitical, straight-laced public messaging." And they fear that political considerations could influence or unduly rush the approval process for a Covid-19 vaccine. ([STAT]( Trump’s Businesses Have Been Paid $900,000 by the Government: President Trump has visited his own properties 270 times since taking office and taxpayers have paid Trump’s businesses more than $900,000 over that time, with at least $570,000 of that resulting from Trump’s travel, The Washington Post’s David A. Fahrenthold, Josh Dawsey and Joshua Partlow report. The Trump Organization also received at least $3.8 million in fees from GOP groups as a result of political events featuring Trump at his properties, according to campaign finance records cited by the Post. White House spokesman Judd Deere said in a statement that Trump has "turned over the day-to-day responsibilities of running the company though he was not required to, [and] has sacrificed billions of dollars" during his time in office. He also accused the Post of "blatantly interfering with the business relationships of the Trump Organization" and said "it must stop." He added that the White House is "building up a very large ‘dossier’" on stories by Fahrenthold and others "as they are a disgrace to journalism and the American people." ([The Washington Post]( Send your tips and feedback to yrosenberg@thefiscaltimes.com. Follow us on Twitter: [@yuvalrosenberg]( [@mdrainey]( and [@TheFiscalTimes](. And please tell your friends they can [sign up here]( for their own copy of this newsletter. News - [GOP Voters Say They Enjoy the ‘Trump Show’ but Want to See a Plan for Second Term]( – Washington Post - [Voter Approval of Trump’s Handling of Pandemic Increases as the Number of Daily COVID-19 Cases Declines]( – Morning Consult - [CDC Director Walks Back Change in Coronavirus Testing Guidelines]( – The Hill - [Controversial Change in Guidelines About Coronavirus Testing Directed by the White House Coronavirus Task Force]( – Washington Post - [Covid Gag Rules at U.S. Companies Are Putting Everyone at Risk]( – Bloomberg Businessweek - [Fed Changes Its Approach to Inflation, as Leaders Aim to Navigate Future Crises and Reach Full Employment]( – Washington Post - [Congress Left Town and Let Jobless Benefits Lapse. Unemployed Americans Say They Won’t Forget It]( – Washington Post - [States Launch New Push for Tax Hikes as Coronavirus Squeezes Budgets]( – Fox Business - [U.S. Postal Service Spent $522 Million on Questionable Overtime Last Year, Watchdog Says]( – Wall Street Journal - [To Counter China, Some Republicans Are Abandoning Free-Market Orthodoxy]( – Washington Post - [CMS to Require COVID-19 Test Results for 20% Medicare Add-on Payment]( – Modern Healthcare - [U.K. to Pay People on Low Incomes If Isolating Due to Covid]( – Bloomberg Views and Analysis - [Trump's Presidency in Seven Metrics]( – Bloomberg News - [No Platform, No Vision. The GOP Convention Was All About Fear and Resentment.]( – Max Boot, Washington Post - [The Elite Needs to Give Up Its G.D.P. Fetish]( – Oren Cass, New York Times - [The Economy and Unemployment; Will Trump And Washington Help?]( – Richard McGahey, Forbes - [Those Who Like Government Least Govern Worst]( – Ezra Klein, Vox - [How to Fix the US Postal Service]( – Stephen Kearney, Roll Call - [Think the Pandemic Is Bad? We're Setting Ourselves Up for a Lot Worse]( – Philip B. Duffy, The Hill - [The CDC’s New Testing Guidance Is Nonsensical]( – Leana S. Wen, Washington Post - [What Did We Learn From the Postal Service Fiasco?]( – Bloomberg Editorial Board Copyright © 2020 The Fiscal Times, All rights reserved. You are receiving this newsletter because you subscribed at our website, [thefiscaltimes.com]( or through Facebook. The Fiscal Times, 399 Park Avenue, 14th Floor, New York, NY 10022, United States Want to change how you receive these emails? [Update your preferences]( or [unsubscribe](