Economy /

US President Donald Trump’s decision to sign off on the latest $900 billion COVID relief bill has the stock market soaring. Ordinary Americans? Not so much, considering they will now get $600 checks instead of the $2,000 checks Trump was demanding when he said he would veto the bill.

Trump Flip-Flops on $2,000 Checks

After complaining about the bill’s chunks of money for foreign aid and various wasteful government programs, Trump eventually signed off on it. Unemployment insurance temporarily lapsed over the Christmas weekend as a result of Trump’s delay in signing the bill into law. It was already previously approved by the House and Senate.

Senator Bernie Sanders called the delay “unbelievably cruel” due to the fact that the bill contained provisions protecting people from eviction and other measures, while House Speaker Nancy Pelosi said that Trump’s waffling was a sign of incompetence and disregard for the American people. Now that the bill is law Pelosi claims it will help “the millions more struggling to stay afloat during this historic pandemic and economic crisis.”

Other Democrats sounded off even more loudly about the threatened veto, with Representative Gerry Connolly of Virginia saying Trump played “Russian Roulette with American lives.”

In addition to helping pay for the $600 to most Americans, the bill reups jobless benefits, help for small businesses, airlines, farms and other industries as well as money to pay for vaccines and education budgets. The attached Omnibus spending bill will keep the government running until the end of this coming September and avoid a federal government shutdown.

Specifically, the bill also gives $100 a week extra to self-employed and regularly employed workers whose self-employment income isn’t factored into the size of their unemployment checks. The bill will give $300 extra per week to unemployed people, down from $600 extra per week that ended this summer. In terms of eviction protection it will give $25 billion in help to tenants who are facing eviction.

Why Did Trump Back Down on His Demands?

Legislation being pursued by Republican Senator Josh Hawley of Missouri and Sanders to get Americans more help during the pandemic typifies the converging economic populism of the Trump right and the Bernie / AOC left. Both wings were thoroughly beat down by Congress: AOC said the 5,593-page bill was too long to read and signed off anyway, while Trump said it was a “disgrace” and still backed down and signed it.

Why?

The first answer is likely simple pragmatism: in order to keep the government running and avoid an unemployment and eviction crisis right now the President and Congress passed the buck and signed off on the pork barrel-laden bill.

Trump — who is back stumping for the two Republican candidates in the upcoming Georgia runoff elections which could determine the balance of power in the Senate — seems to have been reined back into Senate Majority Leader Mitch McConnell’s Randian establishment GOP zone of comfort. In addition, Trump may have signed off because a potential check increase can be discussed in the future now that the bill is law, even though it’s unlikely to pass.

Similarly, Trump’s previous veto of the NDAA defense bill — that he disliked for limiting troop withdrawal options, focusing on Confederate name removal from monuments and doing little to take on the monopolistic and speech policing of Big Tech — was overridden by the House by 322 to 87 votes — handing Trump two big losses on his way out the Oval Office. As in so much of his presidency, Trump’s populism is a lot of talk without much action, blocked both by his own mercurial and erratic style of governance and the malicious economic ideologies represented by key GOP powerbrokers.

Kentucky Senator McConnell — a smooth political operator if there ever was one — is married to Elaine Chao whose family-owned Foremost Maritime Inc. has strong ties to the Communist Chinese government. The McConnells are worth over $34 million combined. Foremost received a bulky loan worth more than $417,000 as a result of The Coronavirus Aid, Relief, and Economic Security (CARES) Act which was passed by Congress earlier this year in March.

McConnell said that even though the $900 billion relief bill isn’t “perfect,” it will do “an enormous amount of good for struggling Kentuckians and Americans across the country who need help now.”

Perhaps McConnell would like to trade and get just $600 while he can divide up the 400K at a local food bank in Kentucky, which has over 700,000 people living in poverty including 21% of its childhood population. More than 10% of Kentucky’s population also has no healthcare coverage.

Congressional Hypocrisy Rises to New Heights

A number of other budget hawks and Democrats who signed off on this $600 check relief bill also got major cash and loans via CARES, including Republican Representative Vern Buchanan of Florida (estimated worth $73 million) who got a $2.8 million loan for four of his companies. Republican Devin Nunes of California got $2.95 million from CARES for two wineries and farms that he has a stake in, while Democrat Earl Blumenaeur of Oregon (estimated worth $4.5 million) got $432,000 for two of his companies and Democrat T.J. Cox of California (estimated worth $11.8 million) nabbed $609,000 for two of his enterprises.

Many members of Congress have businesses and are in leadership at private firms and organizations. This is permitted under US law as long as the company is not publicly traded. Handing themselves handouts from money meant for businesses going under is the height of hypocrisy, particularly in cases such as that of Republican Carol Miller of West Virginia.

Miller works as a legal assistant to her husband car dealership chain, which got over $3 million in CARES loans even though West Virginia’s Governor Jim Justice said dealerships were essential in March, calling into question why they would need an emergency infusion of loan funding.

What Happens Now?

There is the chance of negotiating higher additional checks in the future, although the timetable means that for now most people will be getting only $600. The Democrats have a majority in the House and used it Monday to approve the CASH Act bill for $2,000 checks — and was later brought forward in the Senate for unanimous consent as Chuck Schumer has said he would do. This action has the potential to throw the GOP into disarray as well as potentially humiliate and undercut Trump. The Republicans hold a majority in the Senate and thus are in the awkward position of voting down a popular proposal that Trump had previously backed if it ever goes to vote.

Members of the party like Hawley and Representative Elise Stefanik clearly feel differently than McConnell and Co., however, with Stefanik saying that $2,000 checks are a must-do in order to address the “dire need of relief” among the American people. It remains to be seen if enough Republicans split off that the increased checks can pass.

The McConnell wing of the GOP has a deep donor list and long reach. They are not interested in handing out bigger checks or expanding into anything resembling populism. Although they are fine funding wasteful defense contracts — with rare exceptions such as Rand Paul and recent GOP defector Justin Amash — the thought of ordinary Americans having more money makes the McConnell crowd balk.

As Republican Mo Brooks of Alabama said recently: “it’s money we don’t have, we have to borrow to get and we can’t afford to pay back. Someone’s got to show me how we’re going to pay for it. How far before we all go into debilitating insolvency and bankruptcy?”

Sanders said he will object to McConnell’s attempt to override Trump’s veto on the defense bill in the Senate, which would throw a wrench and delay into proceedings and put pressure on McConnell to sign off on the $2,000 checks.

The outcome of this dramatic, chaotic and tragic transition of power and political crisis remains to be seen, as 2020 goes down in the record books as the deadliest year in American history.