WASHINGTON – President Trump's executive orders aimed at stimulating the economy won't bring unemployed New Yorkers an extra $400 in weekly benefits.
They won't bail out the cash-strapped New York State government and local governments.
They won't give everyone a $1,200 stimulus check – but they will give the employed a temporary reprieve from paying the taxes that fund Social Security.
Those are the key facts Western New Yorkers will face regarding the executive actions Trump took over the weekend after failing to come to a deal with Congress on another round of economic stimulus amid the Covid-19 pandemic.
The bottom line? Trump's actions won't have nearly the impact locally or nationally as would what's proved elusive in Congress: a deal that directly helps the unemployed and every other American, as well as their state and local governments.
"I was glad he took action on it," said Rep. Tom Reed, a Corning Republican and Trump supporter, said of the president's executive orders. "But I'll just tell you, Congress still has to act. This is not going to be the panacea for the crisis, and I just hope that his executive order sets the stage for, within the next two weeks, Congress doing what it needs to do – and that's come up with a deal that's going to help out on all the issues."
Here's a closer look, issue by issue, at Trump's executive orders and what they will and won't do in New York State.
The people who lost their jobs amid the pandemic had, since March, received an extra $600 weekly in unemployment benefits, courtesy of Cares Act, the federal stimulus bill Congress passed at the beginning of the coronavirus crisis in March. But those payments expired at the end of July, prompting Trump to introduce a makeshift replacement.
Under Trump's plan, the unemployed would get an extra $400 a week – if the states agree to kick in $100 of it.
In New York and likely elsewhere, that's a nonstarter.
New York needs $30 billion in federal aid over two years to patch the hole the pandemic blew in the state's finances – and if the state were to pay those extra unemployment benefits as Trump suggests, that hole will grow by another $4.2 billion, Gov. Andrew M. Cuomo said Monday.
"That's handing the drowning man an anchor," Cuomo, the chairman of the National Association of Governors, said. "This only makes a bad situation worse."
Cuomo isn't the only governor casting doubt on the president's unemployment plan. Asked on CNN whether Ohio can afford to chip in another $100 a week for its unemployed, Gov. Mike DeWine, a Republican, replied: "The answer is, I don't know yet."
State and local aid
Despite gaping holes in state and local budgets nationwide, the Trump administration has adamantly opposed any federal action to help.
That's frustrating to Reed, who has been working with Sen. Bill Cassidy, a Louisiana Republican, to try to strike a deal to direct federal dollars to troubled localities as well as states.
"We were getting closer, and everything we'd been hearing is that things are going the right way – and then all of a sudden, over the last four or five days, things seemed to get really sour," Reed said. "And some people were under the impression that the political calculation was made that this wasn't going to favor the president, that wasn't going in favor of Republicans. And that's when everything broke down."
Reed, who also is pushing for child care funding in that elusive congressional stimulus package, said Congress may not actually agree on state and local aid until the American people start seeing consequences of congressional inaction. And those consequences could come this fall, as both blue states and red states struggle to send school districts the aid they are expecting, said E.J. McMahon, founder and senior fellow at the Empire Center for Public Policy in Albany.
"All the states and localities had their revenues crater because of this," McMahon, a self-described fiscal conservative, said. "Don't give me that stuff about, well, they're mismanaged, They've got billions of dollars less in revenue than they expected. They had no reason to believe it would disappear overnight."
Payroll tax deferral
Congress approved a $1,200 stimulus payment to most Americans in March, and Democrats have been pushing for something similar in the next stimulus package.
But Trump, in an executive order, tried something different. For the rest of this year, he's deferring the 6.2% payroll tax that funds Social Security for workers who earn less than $104,000 a year.
Republicans and Democrats alike in Congress have opposed that idea, simply because it directs a relatively small tax cut to people who aren't suffering the worst from the economic crisis.
"It is remarkable that the president is advocating a tax cut that bypasses everyone who's unemployed," said Anthony J. Ogorek, a Williamsville financial planner.
There are also questions about whether Trump has the power to unilaterally stop collecting the payroll tax.
For example, Sen. Ben Sasse, a Nebraska Republican, dismissed Trump's payroll tax move as "unconstitutional slop."
Of course, some Republicans are sticking by the president's proposals.
Rep. Chris Jacobs, a Clarence Republican, did not return a call seeking detailed comment on Trump's executive orders. But in a statement, Jacobs said: "I applaud President Trump’s decisive action to make the health and financial well-being of Americans a priority and sign executive orders that will boost our economy, protect unemployed Americans, and aid Americans suffering from the effects of COVID-19."
Democrats, however, offered harsh words for the president's actions.
Senate Minority Leader Charles E. Schumer said on the Senate floor Monday that Trump's payroll tax deferral "makes no sense" – but that it's of a piece with the rest of his executive orders.
"Executive orders in general aren't going to get the job done – especially the incompetent ones issued over the weekend," Schumer said.
Rep. Brian Higgins, a Buffalo Democrat, noted that the Democratic House passed a bill with enhanced unemployment benefits and state and local aid in May. Higgins said it's in the president's political interest to embrace that bill, called the Heroes Act, because without such a measure, unemployment is likely to balloon in the months leading up to the fall presidential election.
As for Trump's executive orders, Higgins said: "This isn't going to be helpful."