Stimulus Talks on Verge of Failure as Both Sides Trade Blame

We said a few days ago that even given the best case scenario of a stimulus deal by weekend, any compromise was certain to result in too little spending to do remotely enough good. And on top of that, with even that vote not happening until next week, any new unemployment supplement payments would not hit recipients’ wallets until the end of August.

The state of play is much worse. The Senate has been sent home, an admission that a deal is somewhere between remote and not happening. Mitch McConnell has sat out the talks, at least in part because the Republicans are so divided that they can’t be herded anywhere. Oh, and needless to say, no one is betting on a breakthrough before the supposed deadline of Friday.

Some snippets from the press. First, The Hill:

Congress and the White House are barreling toward an end-of-the-day Friday deadline set by the main negotiators: House Speaker Nancy Pelosi (D-Calif.), Senate Minority Leader Charles Schumer (D-N.Y.), White House chief of staff Mark Meadows and Treasury Secretary Steven Mnuchin…

“We might not get a deal,” said Senate Appropriations Committee Chairman Richard Shelby (R-Ala.). “There’s a lot of pessimism here. … Are we too far apart?”

Sen. Lisa Murkowski (R-Alaska) told reporters it “doesn’t look like” there will be a deal this week. And asked if he was optimistic there would be a deal, Sen. Mike Rounds (R-S.D.) responded “nope.”

In a sign that a breakthrough isn’t imminent, senators were told Thursday they could go home, but to plan to come back if an agreement is struck.

From Politico:

Negotiations between the White House and Democratic congressional leaders on a new coronavirus relief package were on the brink of failure Thursday night, both sides said after a fruitless three-hour meeting in Speaker Nancy Pelosi’s office….

After their 10th face-to-face session with Treasury Secretary Steven Mnuchin and White House chief of staff Mark Meadows, Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) blamed the White House for failing to reach a bipartisan agreement that would allow the resumption of federal unemployment payments or provide hundreds of billions of dollars in new aid to state and local governments. Democrats are pushing a relief package costing more than $3 trillion, while the White House and Senate Republicans want to keep the price tag closer to $1 trillion.

“We have always said that the Republicans and the president do not understand the gravity of the situation,” Pelosi told reporters afterward. “And every time we meet with them, it is reinforced.”

“Right now, I would say the president only has two choices,” Schumer said. “The first is to negotiate with Democrats; he knows Republicans can’t pass a bill, you probably can’t even get a majority of Republican senators to vote for any bill, let alone the House.”

And CNN:

A three-hour meeting Thursday evening between senior administration officials and Democratic leaders yielded little progress as both sides seemed resigned to the likelihood that Congress won’t reach a major stimulus deal amid an economic crisis…

It’s unclear if the two sides will meet on Friday. White House chief of staff Mark Meadows and Treasury Secretary Steven Mnuchin plan to brief Trump later Thursday night and Friday morning as they decide whether to continue to negotiate with Democrats…

Democrats have argued that passing anything less than a large-scale package is a non-starter and have pushed back against the idea of passing anything piecemeal.

But the two sides have been far apart on a top-line price tag for a stimulus package, making an overarching deal hard to reach. Pelosi told CNN this week that she wants a price tag of $3.4 trillion, a number that Republican negotiators have balked at. Meadows said earlier Thursday that the White House top-line number was now “north” of the initial GOP offer of $1 trillion.

“My frustration is that we could’ve passed a very skinny deal that dealt with some of the most pressing issues,” Meadows said Thursday evening.

One of the biggest sticking points: aid to state and local governments.

Democrats have made a boost in aid to state and local governments a key priority and a House-passed Democratic proposal provided $500 billion to states and $375 billion to local governments. In contrast, the initial Republican proposal didn’t include additional funding for states or cities, but gave them more flexibility to use some of the $150 billion allocated in the CARES Act relief legislation for revenue shortfalls.

In the meantime, Trump acts as if he can adequately plug the growing hole in the economic dike with executive orders. With all spending bills having to originate in Congress, this is loopy. Trump can probably implement an eviction freeze, since courts have upheld state-level eviction freezes by governors. Trump also seems to think he can eliminate payroll taxes. Even his own team has doubts. From the Financial Times:

Mr Shelby said he thought Mr Trump could do a “lot of things” by executive order, including suspending the payroll tax. But Chuck Grassley, another longtime Republican senator, poured cold water on the idea. In addition to questioning whether Mr Trump had the legal authority, he said the idea made no economic sense.

And it’s not as if a payroll tax holiday accomplished much. Businesses hire based on demand, not based on comparatively small changes in net payroll costs. True, it could make a small difference in how long businesses struggling to make it hang on or delay headcount cuts, but another PPP jolt would be far better. Workers get a bit more net pay, but with Covid-19 grinding on, many will use any extra dough for savings (and paying down debt is a form of saving) rather than spending. And of course, you need to be employed to benefit.

In other words, the cynical take is the most accurate: this gambit has more to do with putting the Social Security trust in the appearance of distress faster than goosing the economy.

In the meantime, if and when there is a deal, the airlines are at the head of the line. Hubert Horan said at the start of the week that when the current airline payroll support ran out in October, the airlines would implement big schedule cuts. I flew at the end of March when airlines had reduced their flights to bare bone levels, and it was difficult to find anything more than one or two flights from A to B if either A or B was not a huge hub, and even then, with terrible layovers. Someone apparently got the memo. Again from the Financial Times:

Meanwhile, a union-backed push to extend payroll support for US airlines until the end of March is gaining steam. Sixteen Republican senators on Wednesday signed a letter supporting another $25bn for airlines to avoid mass furloughs. Their support for the additional aid, already backed by a majority of lawmakers in the Democratic-controlled House, raises pressure to include it in a final package.

The airlines received $50bn in aid in March to keep pilots, flight attendants and other employees on payroll until September 30, with the expectation that passenger traffic would have recovered by then. But data from the Transportation Security Administration shows traffic is still down 75 per cent compared with a year ago.

I could go on about how disastrous a skinny deal, no deal, or even a better but late deal would be, but readers are very familiar with this terrain from their own information-grazing and personal knowledge.

It is conventional for accounts of political sausage-making to be almost entirely about the process at the expense of the ramifications. But the bloodless tone also reflects the fact that our supposed leaders are too far removed from any consequences to care, at least until it is way too late.

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  1. Amfortas the hippie

    one of the parts of this mess that i haven’t been able to game out to my satisfaction in in regards to the aversion to helping the states and local governments.
    is it pure ideological blindness?
    what’s in Turtleman’s Secret Heart?
    I see sort of half hearted justifications relying on a moral hazard argument…”bailing out” states rewards them for their profligate behaviour and it’s just consequences.
    that can’t be the whole of it.
    I think about the towns and city i’m most familiar with, as well as the counties they’re embedded in, and think about all the services we forget about and the jobs provided…as well as all the grants and such for infrastructure, etc…..and this is without considering schools.
    without sufficient sales tax(and property tax, but that’s slow moving), there will be layoffs and service cuts.
    cities and counties will struggle to service their bonds.
    and what about whatever pensions remain?
    That this is apparently the GOP’s chosen hill to die on, seems pretty darned extreme, to me.
    and it’s not above the Fold, either…which further confuses me.

    Thankfully, Yves has provided a virtual think tank….

    1. Democrita

      The whole GOP philosophy is to funnel all monies from small entities to large ones. From the many to the few. From working citizens to wealth-sick corporate titans. Cities and towns don’t rate.

      1. Amfortas the hippie

        have the dems been seen with pillows yet?
        is it really that simple?
        GOP takes hard line, dems cave, and money flows upward?
        surely someone in the tippytop cohort can see what’s happening out here….
        and it’s not hard to run a thought experiment based on even a cursory survey of conditions outside the Bubble, and figure out that the current course leads to an insane and unprecedented disaster.
        Epicurus bubbles up:

        so is it incompetence, indifference or malice?
        If Senator Ted ever got back to me that was the main question i had for him.
        I’d love to hear about how all this could lead to a rosy scenario and goptea libertopia.

        1. urblintz

          I have a theory, aside from malice and indifference both of which certainly apply….

          they don’t want to create any locally (state and city level) elected heroes because state and city level political heroes become federal level legislators. They are in part scaffolding their incumbency against those who would depose them… maybe?

          Control freak sociopaths the lot of ’em…

          1. campbeln

            Given pushes like the Lincoln Project, I think the whole system (call it the swamp, deep state, whatever tickles your heart) is 100% full bore focused on getting Trump out of office, no matter the collateral damage.

            Attributing this to the GOP and the GOP only is naive IMHO.

            1. Amfortas the hippie

              you mean that whatever is behind the surface phenomena(D vs R, Lvs R.) is doubling down on the crises, in order to make trump look bad?
              He’s the Judas Goat?
              idk. I think that assumes that there’s enough election machinery still functioning as if we were a democratic republic that there would be some question about trump’s chances,lol.
              all the political artillery anyone could want is right there in front of us….of course, picking and up and using it might give the proles ideas going forward…
              so it’s make sure trump is blamed for all of it, including the looting and pillaging, and combining and swallowing, from on-high that i’m certain hasn’t even got rolling yet.
              crash fast, thin the herd in the process, and wake up in february with a new government that has the messaging right to explain the new order to a bunch of shell shocked and desperate americans.
              Harkonens give way to Atreides, backed up by the Corino.
              just a different phase of the Faufreluches

              1. campbeln

                If you’re an incumbent in a heavily Gerrymandered district (and, who’s not?), the machinery is functioning to perfection (but that may have been your point).

              1. Tony Wright

                Why? Maybe they just don’t want to inherit a poisoned chalice this time around. Obama inherited the GFC and two stupid wars last time in 2008.
                Pity about the majority of US citizens though – not that the plight of voters seems to be top priority for the DNC….

          2. polecat

            I’ll take your cynicism even further. They, of the Haus of Blue & Red, are willing to not only sweep the continental table clean .. but in fact aready have the chainsaws-of-chaos abuzz, with the end result being the creation of a number of new fiefdoms in which to gain, in both new powers and new wealths, as it relates to the former plebeian citizenry (those who haven’t yet died of privation and disease, anyway ..), who are staring down the Chasm, only to be pushed into new age of serfdom!

            I believe our “Representatives”, those who worship the two-faced god, are positioning – gaming the next level of GRIFTer’s Hell upon us all, with no need to keep country ‘whole’!

      2. nick

        I would say that government incompetence is a core GOP goal because it strengthens their argument for privatization. They also probably rightly see public employees as a Dem constituency. Theoretically they have to balance their efforts against any blowback or blame they might receive (as public officials themselves) but that hasn’t really been a problem given credulous media, the Dems own shortcomings, and political disinterest.

        1. Bob Hertz

          Republicans can also count on a new degree of resentment toward public employees.

          A fair number of public employees got to stay home and never miss a paycheck during the pandemic so far. Many worked from home, in some cases not working very hard.

          There is a burgeoning class conflict in the USA between public and private workers, and computer-users vs. those who work face to face with customers.

          1. Laughingsong

            Forgive me but as a public employee I know that public employees are being laid off/reduced/furloughed. A quick online search just now revealed many state, city and county entities started this as far back as April, even after receiving some stimulus in the CARES act.

            And excuse me for pointing out that counties employ many front line health workers, but also back office health and safety workers. Please do not insinuate that they Are “not working very hard”, that’s really very difficult for me to read, especially here.

            Please stop setting public and private workers against each other and doing the elites’ work for them, Thank you.

            1. Amfortas the hippie

              amen to all that.
              i like the garbage men in town a whole lot better than i like any congresscritter.
              and…teachers are public employees(for now)

        2. John Wright

          The GOP has been asserting, for many years, that there is much government incompetence.

          But such GOP favored operations as the military, FBI, NSA, CIA and police departments are strongly supported.

          Why is there little GOP “government is the problem” scrutiny for THESE groups?

          A fundamental flaw of the GOP privatization efforts is a seeming belief that everything in the economy can be run at a profit.

          Many societal functions such as providing support for out of work people, the sick, helping the homeless, rebuilding infrastructure and environmental cleanup will not be profitable.

          Government is needed to provide services that are necessary for a just and fair society.

          But the Dems behave as “GOP lite” as they fall in line behind the GOP in wars and financial rescue operations.

          The hope for the future is that President Joe Biden might behave far better than he did in the past.

          It is difficult to make much bank on that.

    2. Jeremy Grimm

      I share your concern and wonder about why State and Local Government has received no Federal support. I can’t figure out how anyone could benefit from this neglect.

    3. Glen

      BLM talks about defunding the police, but the Republicans are gonna defund the whole shebang: cops, firefighters, teachers, road workers, sewage workers, bus drivers, libraries, hospitals, you name it.

      Didn’t somebody talk about making government small enough that you could drown it in a bathtub? We’re there! We’re now officially a libertarian paradise!

      Pretty soon our oligarchs will start buying public infrastructure for pennies just like when the USSR collapsed. Amazon Road is coming with a tollbooth near you today! Become a member of Amazon Road Prime, and you can pay over and over for the road that property taxes bought fifty years ago! PROGRESS!

    4. drumlin woodchuckles

      The Republican Senators hope that withholding financial help from state and sub-state levels of government can drive some of them and maybe all of them into liquidation so that they have to sell off all their public assets at pennies on the benjamin to private rich people. It is a final stage of Plan Yeltsin for America. It really is that simple.

      That’s my first instinct, anyway.

  2. Bob Hertz

    Many Republicans believe that state and local governments are overstaffed, overpaid, and certainly over-pensioned.

    In other words, they can tighten their own belts for a long time before needing federal assistance.

    There probably are some states like Illinois where this is true. Do you screw all the rest of the states to make one of them grow up?

    1. marym

      Yes, Republicans like to blame government workers and retirees. They don’t even care about their own non-wealthy constituents:

    2. curlydan

      I’d encourage people to look at their companies or employers, present or past. Do you know of any overstaffed or over-paid people there? Laziness knows relatively no bounds in the workplace. Once the fiscal stimulus taps are turned off, a lot of people both in government and the private sector are going to “grow up” ,and it won’t be pretty.

  3. Christopher Herbert

    It’s interesting that Pelosi, who I don’t think understands national finances, is recommending a $3.4 trillion package. That amount, and the disbursement to individuals and state and local governments, is adequate. But does she understand it could be financed without any debt being used? Does Mnuchin? Does anybody? One can’t know because the press apparently doesn’t understand national finances either. So we have a bunch of top level pols, and a supposedly informed media, and absolutely no one is explaining how this gets paid for. We could hire every unemployed person in the country and have full employment in a matter of months. Yet absolutely no one knows this? Unemployment is a political choice, for Heaven’s sake. Incredibly scary, from my point of view. Someone call Stephanie Kelton, R. Randall Wray, Bill Mitchell and William Mosler please? At least they understand the national accounts.

    1. mike

      why stop there? couldn’t we also make everyone a Billionaire? Just a political choice, too?

      1. Christopher Herbert

        Too funny, isn’t it. The CNBC crowd still pushes stock and bond prices up, to and beyond what should be a break point. We haven’t collectively done any national infrastructure investments in 40 years. Instead we’ve allowed a tidal wave of private debt (and public debt too, but that’s nowhere near as bad as private debt) to accumulate. It cannot all be paid off, of course. Compound interest will crush the real economy. Has damn near suffocated it already. Ignorance and greed run our nation. I’m not voting for it. Never have. Never will.

    2. Rodger Malcolm Mitchell

      Even $3.4 trillion is inadequate. Months ago I wrote about the need for $7 trillion. Now, maybe $10 trillion is needed.

      The phony concerns about the federal “debt” (i.e. deposits into T-security accounts) is a for show. The entire “debt” could be eliminated, tomorrow, while spending is increased and taxes cut. The typical voter doesn’t understand Monetary Sovereignty. Thinks federal finances are like personal finances.

      Apparently, the heartless GOP believes they can pin the coming depression on the Dems. Why else would they vote against the only thing that could save Trump: A recovering economy?

      1. drumlin woodchuckles

        Well, a coming depression would allow the Sanderistas to blame it on the ClintoBiden ObamaDems.
        Would the Sanderistas have the winner instinct to do so? If not, then they too will join history’s junkpile, along with the rest of Darwin’s discards.

    3. diptherio

      Kelton’s recently published book has been getting high praise, even from non-MMT types. I’m sure they are aware of it, or if not them then their staff. They just don’t care. Going full MMT for the pandemic would alert people to the fact they don’t need to make a choice between social services and…well, anything else. Can’t have that now, can we?

      1. Anonymous

        Going full MMT for the pandemic would alert people to the fact they don’t need to make a choice between social services and…well, anything else. diptherio

        Don’t be too fooled: “Spend and tax” is better than “Tax and spend” since it eliminates the output gap but MMT still proposes to tax the non-rich should price inflation become bothersome.

        Also, increased privileges* for the banks with guaranteed wage-slavery for their victims is rather a shoddy deal unless you happen to be rich.

        We can do better, justice wise, than what the MMT School is peddling but we need to start with DE-PRIVILEGING the banks and mandating that ALL fiat creation be for the general welfare, not for the private welfare of the banks and the rich.

        *unlimited deposit guarantees FOR FREE.
        *unlimited, unsecured loans at ZERO PERCENT from the Central Bank.

        1. Rodger Malcolm Mitchell

          Contrary to popular wisdom (and MMT) taxing does not prevent or cure inflation, (nor does spending cause it).

          Inflations and hyperinflations always are caused by shortages of key goods and services, most often food or energy.

          The old trope about “too much money chasing too few goods” is only half right — the “too few goods” part. Money supply never corresponds with inflation.

    4. polecat

      She, as well as the rest of the Purple Brethren .. understand ‘per$onal’ finance quite well!

      After all, to loosely paraphrase a certain Bankster … ‘We’re all richer than you!’

  4. doug

    What seems nuts to me is that McConnell is not participating. He is the leader of the freaking senate. Get in there and lead, dude. The USofA needs a surprise to the upside for a change.

    1. marym

      He is leading. He got another judge confirmed this week. House Democrats are also leading. They gave up their leverage on the first corporate-friendly round, passed a second round in the House and let it sit with McC. Senate Democrats are leading by not having said much of anything. Everyone is leading as they always do on behalf of the .01%

      1. campbeln

        I wish more people would see this.

        TARP was a perfect example, as was the first stimulus this time around; the 0.01% are efficiently and effectively catered to when it’s deemed necessary. The speed at which the 3, nay 4, branches of government move in those situation is breathtaking. The gridlock for the 99.9% is theater.

  5. timbers

    To use a NC term…it’s gonna take a Mr Market hissy fit for another stimulus to pass.

    The Prime Directive of the Fed is make the stocks go up and inflate asset prices. The openly stated number one goal of our President is to make the stocks go up. That’s stock owning Congress’ marching orders, to.

    Stocks are going up. So obviously no stimulus is needed because by everyone’s definition in Washington, we have the best economy ever because the stock are going up.

    1. curlydan

      30M people getting $600 extra each week in July and the months previous was a weekly $18B boost for the economy or about $72B-$75B per month. Once $75B starts to drain from the economy per month (from people who likely spend nearly every penny of it), a market hissy fit is almost certain to occur, oh, right around election time. Too bad these guys apparently can’t see it coming.

  6. Kurtismayfield

    one of the parts of this mess that i haven’t been able to game out to my satisfaction in in regards to the aversion to helping the states and local governments.
    is it pure ideological blindness?

    Yes, they want the “liberal” states to go under. Pensions slashed.. etc. Since those were the states that got the largest spike first, they figure they can make them suffer more.

    The whole “Look we are fiscal conservatives!” game has been turned on. They fear they will lose horrible in November, and are back to the same olde playbook. Except its embarrassingly obvious to anyone with a pulse that they don’t care to be fiscally sound when they are in office.. just when the opposition is. Yet their 30% base will buy it up because just like Mulder, they want to believe.

    1. Amfortas the hippie

      all well and good…gop=bunch of cruel idiological deathcultists, yada yada.
      riffing on Leo Strauss, is the view from within the Innermost Circle of Adepts that they will rule in hell?
      is the assumption that blackrock, et alia will swoop in and scoop everything up?
      and then wheat?
      isn’t a great chunk of the global economy reliant on things like VIX and “consumer spending”?…and aren’t the various “exotic financial vehicles” reliant on those mundane things as well, due to the incestuous nature of this thing they’ve built?
      Here I am buying black pepper in bulk as a trade item,lol….because i expect that level of rapid decline.
      what world do they envision, outside camera range, in the proverbial walnut paneled room with wingback chairs?
      Are we to a point in the 50 year harvest preceding collapse where it just doesn’t matter any more about appearances?
      Or are they really just myopic, blindered and stoned out of their minds on their hubristic stash?
      I don’t know which is worse.

      1. drumlin woodchuckles

        They hope to Yeltsinize the states by driving them into liquidation. They are perfectly willing to lose half of what they have if they can take away or destroy both halves of what the rest of us have.

        People with personal means of subsistence production outside of or beyond the reach of the monetized formal moneyconomy will have a higher chance of surviving the coming Long Forced March through the Valley of Selection.

  7. jackiebass

    We have the best government money can buy. This is just another example among many.I’m not an economist but I believe the best way to help the economy is to get money in the hand of people that will spend it. Also helping states is important. The first thing that happens when a state is in financial trouble is to cut public employees at the state and local level. A sector effected in a big way is education. When a state is in economic trouble support for schools is reduced. All at a time when schools need more funding.These employees are important to the local economy. When they are not working the can’t spend. Also important services provided by these employees suffers. The whole thing is like a stack of dominoes. The first one falls and topples all of the dominoes.

  8. Harry

    This could well be one of the best possible MMT experiments. I am watching with baited breath. MMT would have predicted that unlike Fed QE, fiscal intervention would be a powerful boost to asset markets. A closed dollar system has no where else for the fiscal stim to go than its asset markets.

    However, take away that slow of cash and you will see a disproportionate drop in asset markets. We should see Gold/Stocks/ etc (maybe not bonds) all come down.

    Hey, i know its a pretty shitty silver lining but Im extremely curious to see whether this burns politicians as quickly as I suspect.

    1. Wukchumni

      However, take away that slow of cash and you will see a disproportionate drop in asset markets. We should see Gold/Stocks/ etc (maybe not bonds) all come down.

      Why would somebody in Mumbai* care whether we gave our citizens free money or not

      *i’d guestimate that for every American investor in all that glitters, there are 1000 Indians holding the precious.

      1. drumlin woodchuckles

        When the very last can of catfood is gone from the very last shelf of the very last Walmart on the face of the earth . . . then the Indians will learn they can’t eat gold.

  9. edmondo

    I had no intention of voting in November but I will make a point of voting against any of my Congresspeople who vote to throw more free money at the airline industry.

    1. sharonsj

      And what about the free money for the cruise industry? They aren’t even American companies; they’re usually headquartered in the Bahamas to avoid American taxes and their crews are international.

      1. Amfortas the hippie

        i’ll be happy if things more or less hold together for another 6 months.
        after most of a lifetime in near-poverty, i might be coming into some money, soon…assuming probate courts and life insurance companies and whatnot are functioning.
        but i just spent almost 5 months waiting to get treated 2×6’s and 14 sheets of cdx.
        that black plastic irrigation pipe is apparently unavailable.
        and there are still no goats to be had out my way…in goat country.
        I’ve had a list, in order of priority, that is labeled “Things to Do If We Come Into Money”….in anticipation of winning the lottery or when my parent’s generation begins to check out…a “wouldn’t that be cool”list whittled down to pragmatic essentials, in furtherance of autarky. it was always pie and the sky and not something i could ever count on.
        Now that it might be happening, I wonder what we’ll be able to buy…or if it will end up going to oncology, because getting the check will kick her off of medicaid.
        it’s a funny old world.

    2. Dave

      Why not just vote against every incumbent. New congress critters can’t be any worse than the ones we have now. A couple o iterations of complete change and maybe the powers that be would understand the plebes are not happy with the status quo.

    3. drumlin woodchuckles

      Not even coming out and casting a blank ballot? So somebody would realize you care enough to come out and vote ” no ” ?

  10. John Hacker

    The GOP has planned all along to give the Prez power through executive order to grant extensions and the Dems co-signed the crap. As has been said it’s for the Dems to lose. Nice saving Gillium in Florida. Get PPP loan for the Party was a good idea. Sad, sad.

  11. Oh

    I have a hard time figuring out what’s going on with the economy. In my neck of the woods, it looks like all contractors providing home improvement services (landscaping, fencing, etc.) all really busy and appointments for estimates are 1 week out and work schedules 2 months out. Marketwatch reports today that the unemployment rate is 10.2% . If IIRC, it was around 30% right after CV-19 hit. Where are all the jobs? It looks like rents are not coming down. The stockmarket is going up and up (especially Tech stocks) with purchases of their debt by the Fed as well as close to zero interest rates. What gives? Is this the boom before the mighty crash?

  12. Tom Stone

    How well equipped is the USA to deal with an explosion in the Homeless population?
    Say 3 Million by the Election, 5 Million by the inauguration and more after that?
    Gonna open up those FEMA camps. with social distancing?
    Think there might be, I don’t know, a little unhappiness being expressed by the proles?
    The traditional method of bringing down “The Hammer” to keep the rabble in line might be less than adequate.
    Even a public/private partnership with Erik Prince’s company might not be enough, gonna need a LOT of hammers in a LOT of places.

    1. sharonsj

      I think you are underestimating the numbers. CNBC says 20 million could be homeless and coming to a tent city near you. But we won’t see any response from Congress unless those 20 million decide to camp out in Washington, D.C.

      1. drumlin woodchuckles

        Unless those millions bring their guns and ammo with them when they decide to camp out in Washington D. C. . . . they STILL won’t see any response from Congress.

        Though I guess they could see tear gas and pepper spray and rubber bullets and the portable Raytheon Oven-Ray and the L-RAD ear blaster. I guess those things would count as a “response” .

        1. JBird4049

          If the FBI numbers are correct, there are less than a million police in the United States. If twenty million people become homeless, in addition to the half a million that are already, which means that the police will be outnumbered and outgunned. Assuming that the minimum 1/3 of the country being gun owners holds for the unemployed. That would be over six million rather unhappy people

          At that point, does anyone really think that ideology will matter? We already have masses of supposed leftists protesting. By the time the homeless crisis hits, almost everyone will be blaming Congress. Anyone questioning that can merely be shown all the trillions that have gone to the corporations instead of the average American.

          It is there for the seeing, but Congress refuses to see.

          1. apleb

            It doesn’t matter how if it’s a million or ten of current police.
            If there is real unrest, more than now, they will simply hire one half of the protesters, unemployed, etc. to suppress the other half. Private security will skyrocket as well of course.
            There are millions soldiers and especially former soldiers with enough weapons to to suppress any revolt anywhere.

            The forever wars aren’t just a foreign policy tool, they have untold uses at home as well.

    2. timbers

      It just needs to be marketed in the correct manner.

      How about this – Think of it as being pro “family values.”

      Many homeless will have to move in with family, thus strengthening the extended family. Those with no extended family that can help out? Well, just ignore that part.

      It’s a win-win as a campaign slogan and donations from the powerful.

  13. Rod

    I’m chocking on 3.5 trillion$$ divided by 350 million men women and children in the USA yielding a $10,000.00 check for everyone.
    Lump sum $10,000.00 for everyone–that’s what it looks like–or $2,000.00 per month for everyone until Jan 1, 2021.
    Golly nads that is a big number looking at it.
    then I thought–How much does Jamie Dimon make a year and what does that look like:
    $31,500,000/365 days yr= $86,301 per day
    ok then–feeling that the world is not teetering because the ratio remains:
    you=2k a month and Jamie Dimon =$2,589,000 a month
    that’s real jack–about a years worth of M4A for the country or Solar on every public building–(WAG based on this pretty nifty read —–

  14. drb48

    It is conventional for accounts of political sausage-making to be almost entirely about the process at the expense of the ramifications. But the bloodless tone also reflects the fact that our supposed leaders are too far removed from any consequences to care, at least until it is way too late.

    It also reflects the fact that, thanks to gerrymandering and the political divide, very few need to concern themselves with consequences via the ballot box.

  15. michael99

    I wonder if a desire to see Trump lose in November is a major factor in the positions that the negotiators are taking. The Dems obviously want Trump gone, but what is the feeling within the GOP? My sense is that Trump is widely loathed within the GOP even though he has furthered their agenda considerably while in office. I have a feeling many establishment Repubs would just as soon see the back of Trump, and Biden as President. Biden may be a Dem but he’s a staunch proponent of neoliberalism and bipartisanship. Trump is a loose cannon.

    1. drumlin woodchuckles

      Do they? Do the Dems really want Trump gone? The Dems really did want Sanders gone. So they jumped him . . . as that wise man said in that interview.

      But do they really want Trump gone? Well . . . sorta maybe, I suppose . . . kinda. But if he wins they get to spend the next 4 years ” running against Trump” anyway. So do they care . . . really? No. . . they really don’t. Not really.

  16. lyman alpha blob

    After their 10th face-to-face session with Treasury Secretary Steven Mnuchin and White House chief of staff Mark Meadows, Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) blamed the White House for failing to reach a bipartisan agreement that would allow the resumption of federal unemployment payments or provide hundreds of billions of dollars in new aid to state and local governments.

    So let’s backtrack a few years here. How is it that Steve Mnuchin was even available to be picked as treasury secretary to begin with? Oh that’s right, Kamala Harris declined to prosecute him for his role in the mortgage meltdown when she had every opportunity to do so.

    So rather than simply blaming Republicans, perhaps a look in the mirror for the Democrat party would be in order.

    But as we all know, it’s a big club and we ain’t in it.

    1. polecat

      They’re all laughing at us, behind invincibility cloaks, and those green-screen media curtains ..

      … pushing our buttons the whole f#cking time!

  17. Paul Lauter

    What if the “negotiation” going on is basically a charade designed to fail. So that T can step in and claim credit for preventing evictions, and repurposing some appropriated funds for paying (some) unemployment. Even if courts ultimately throw that idea out, it could change some of the election calculus.

  18. Jeremy Grimm

    Although these packages are called ‘stimulus’ packages they aren’t going to stimulate an economy shutdown by the Corona pandemic. The moratorium on some evictions just pushes out what happens when the moratoriums end. No one will be able to pay three months rent in a lump-sum let alone pay the lump-sum reached by whenever the eviction moratoriums end. The unemployment benefits, including the little Federal bonuses, aren’t going to bring back the millions of the jobs lost. Like the eviction moratoriums, they just push a collapse into the future. All these points have already been made in past posts here at NakedCapitalism and in many of the comments.

    My best guess is that our rulers and Elites mutter “Après nous, le déluge” as their personal mantra.

    1. Amfortas the hippie

      yeah…a bandaid on a bullet wound.
      not gonna fix the fundamentals, the infrastructure, the physical plant….along with the knowledge base required for any of that.

      Perhaps we give the PTB too much credit….maybe they’re shell shocked, too, and going through the stages of grief about a failing state….I mean “everything is Fine”, right?
      gop rediscovering Trickle Down and Austerity and making up for their slack with more fervent prayers to Moloch…could be read as either denial or bargaining.
      dems, too…still clinging to the old playbook…the AI in Hillary’s basement lair cannot compute, what with all these extra-parameter inputs…

      I don’t know.
      Cui Bono….or who thinks they will benefit…irregardless of what assumptions are needed for them to arrive at that expectation.

    2. JBird4049

      But Madame de Pompadour was talking about after she died. Our deluge is juuuuusst about here. If not this summer or fall, then by next spring when the weather is good and everything has completely cratered.

      I anticipate good times for all!

  19. Susan the other

    So, “What is the worst that can happen?” Well… the United States can fall dead as a society. “No problem,” you say – ” The Market will take care of it.” OK then. Let’s let Karma be Karma. I’m eager to see the devastation because I’m close to dead anyway. I don’t care. The whole thing is such an obscene mess. Fuck it.

    1. drumlin woodchuckles

      If the United States were to fall dead as a society, perhaps Turtle Island could re-emerge as a better society. The better society that was and perhaps could be again.

      Maybe “America” doesn’t work any more. Maybe its an idea whose time is gone.

    2. Aumua

      There will be a large amount of suffering and death if this happens. We are NOT ready for any kind of smooth transition. We need to be building alternatives now.

    3. JBird4049

      I’m not so ready. I understand that desire. I do indeed, but between the younger family members and knowing that it is usually the little people who pay the greater cost in the war, I am hoping to somehow prevent it all burning down.

  20. Rodger Malcolm Mitchell

    A moratorium on rents just punishes landlords and temporarily helps renters. How does that help the economy?

    The problem today is that the consumers lack the money to consume, and the businesses lack the money to stay in business — and the public believes federal spending requires taxes and causes inflation.

    So, the solutions are:
    1. Give abundant money to consumers and businesses, and don’t worry about who gets what.
    2. Educate the public. Federal spending is not done with tax dollars and never causes inflation.

    1. Aumua

      What is meant is a moratorium on rent and mortgages. Landlords might have to take a hit on rental income, but they won’t lose their properties or anything. Unless they have to sell them, in which case to put it bluntly sorry, but I’m not sorry.

  21. Lambert Strether

    It’s not far from Labor Day, which is when people will start really paying attention to the election. No doubt both parties will eagerly blame each other for the debacle that ensues without a stimulus. Oddly, any new provisions for the so-called “HEROES” weren’t in the first packages, when Democrat leverage was at its maximum. Oh, well.

  22. IMOR

    “Richard Shelby, who was a hot mess when I left the building 30 years ago, and Chuck Grassley, a legit 90, disagreed with Pelosi, 80.”
    Ffs kill me now. The last three schiz who shouted at me downtown would make better ‘leaders.’ Christ.

  23. William Hunter Duncan

    Probably all the 100 million strong precariat has to do is peacefully flood all the richest neighborhoods in America and chant, “help us out or we will help ourselves!”

    Boom, FAT stimulus tomorrow….

  24. Ep3

    Yves, i don’t mean to sound like i knew this is how it would play out. But you have the dems playing the role of “see we want to help we passed heroes act in may”. While the Repubs are the party of “bail out our friends” ultimately bowing to leader Trump. Trump has only changed his “tune” bcuz of recent poll numbers. Then after Tuesday’s election, all Repubs changed their tune to sound as if they wanted to help. But they knew they just needed to stall long enough. And the Dems r just right where they want to be; looking as if they are helpful while doing nothing. “We tried, but u just need to elect us then we will fix things. We can’t fix things until we are in the White House.”
    I don’t expect any sort of further help. Unless Wall Street crashes, even then Orange Man seems to be reactive over proactive. Or if there are signs Orange man is gonna lose in November and he needs to buy some votes. Even then, I would say Repubs would be willing to let him lose, so they can regain their party.
    I can’t wait until November 4. That’s when things will really bomb. Repubs will close the checkbook. And the “war on the debt” will begin. No money for anything. Debt debt debt. That’s all. Gotta cut SS so we can keep the lights on. “cut SS and unemployment will fall from current 25% to 10% we guarantee!”

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