Republicans disgruntled as ‘frenzied’ Trump allies push Democrat-like stimulus measures to save US economy
With coronavirus having killed more than 3200 people worldwide — including nine in Washington State — the Trump Administration is worried about the effect the outbreak could have on the United States’ economy. President Donald Trump has been campaigning aggressively on the economy, hoping to avoid a defeat in November. And journalists Nancy Cook and Victoria Guida, this week in an article for Politico, analyze the “urgent effort” the Trump Administration is making to “rescue the U.S. economy from a coronavirus panic.”
On Tuesday, March 3, the Federal Reserve announced an interest rate cut of half a percent. Cook and Guida note that instead of calming investors, the cut actually “spooked” them.
“Trump advisers and GOP lawmakers have spent the past few days pushing the White House to develop a package of economic stimulus measures, designed to prop up the economy amid growing fears about the spread of the coronavirus in the U.S.,” the Politico journalists observe. “Trump and his aides have been battering the Federal Reserve to cut interest rates — shrugging off the central bank’s traditional independence — only to get an emergency rate cut Tuesday and then watch investors get spooked by the signal.”
Cook and Guida stress that the type of stimulus measures coming from the Trump Administration during the coronavirus scare are more typical of Democrats than Republicans.
“The frenzied push to boost the economy is colliding with Republican orthodoxy opposing short-term stimulus during the last recession,” Cook and Guida explain. “But it’s a reflection of what some Republicans recognize as an existential threat to Trump’s reelection: a potential downturn in the economy and financial markets in the run-up to a close and heated presidential election.”
Quoted on condition of anonymity, a source described by Cook and Guida as a “senior administration official” was critical of Trump’s stimulus push — telling Politico, “I don’t think it’s good policy. The whole litany of temporary measures to stimulate the economy.... I don’t think it works.”
Cook and Guida note that Treasury Secretary Steve Mnuchin has said his department will be meeting with independent bank regulators to discuss the possibility of easing rules for lenders. And on March 3, Trump told reporters he was open to the possibility of a payroll tax cut if Democrats in Congress are agreeable. But a source described by Cook and Guida as someone “close to” the Trump Administration expressed great skepticism over the payroll tax cut idea.
“If we have rational behavior,” that source told Politico, “we don’t need a stimulus. If you can’t leave your house, or if kids can’t go to school and the parents can’t go to work, what good is a payroll tax cut? It’s not like you can go out and buy stuff.”