Republican Disarray May Doom the Next Stimulus

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Republicans have had four months to figure out their position on the next big pandemic relief bill. They’ve had two months since House Democrats passed their version of a stimulus. And yet on Thursday they failed once again to figure out their own opening bid. It was “an abject disaster of a morning,” as Politico’s Jake Sherman put it.

By the end of the day, Republicans had floated and then apparently abandoned a back-up plan to try to embarrass Democrats by bringing up a temporary extension for expanded unemployment benefits — money that expires as soon as this week in some states, and by the end of the month everywhere. It’s not clear whether they ditched the plan because they realized that Democrats would be happy to vote against the slashed benefit levels they were proposing, or because they didn’t have the votes on the Republican side. After all, some hard-liners don’t want to continue expanded benefits at all, while it’s likely that those Republican senators facing electoral trouble this fall have rather different preferences.

If that’s the case, the strategy of getting the White House and Republican senators to endorse the same proposal may be the problem. Senate Majority Leader Mitch McConnell could’ve tried to negotiate with House Democrats without White House involvement and assume that President Donald Trump would sign any bargain they reached — or Trump could’ve tried to strike a deal with House Democrats and dared Senate Republicans to oppose whatever they came up with. Instead, Republicans apparently spent the week trying to reach agreement on provisions that are extremely unlikely to survive once the House gets involved.

The result is that, by failing to even produce a bargaining position, they’ve left themselves clearly responsible for cut-off benefits. Perhaps that won’t matter if they eventually reach a deal, but there’s no guarantee that they will before the August recess — and, crucially, before millions of people lose $600 a week in expanded benefits, spending dries up and the economy suffers grave harm as a result.

As James Pethokoukis points out, it remains something of a mystery why Republicans aren’t just doing whatever it takes to help the economy in the run-up to the election. The evidence suggests that they just don’t believe what mainstream economics says. Some Republicans, in both Congress and the White House, really do believe that generous benefits (and not the pandemic) are responsible for high levels of unemployment, and that government spending will hold back growth rather than provide desperately needed demand for goods and services. Add in Republicans’ inexperience with relevant policy matters, and Trump’s general mayhem, and that may at least partly explain things.

Perhaps they’ll get their act together next week and move quickly to strike a deal with House Democrats. But I wouldn’t bet on it — even if the presidency and the Senate majority (along with the economy) are at stake.

1. Jessica Chen Weiss and Elizabeth N. Saunders at the Monkey Cage on the latest China-U.S. conflict.

2. Also at the Monkey Cage: Gloria Xiong on Chinese economic bullying.

3. Jessica Taylor on the Democrats’ improving chances in the Senate.

4. Brian Contreras on how the polls could go wrong.

5. And my Bloomberg Opinion colleague Francis Wilkinson on Alexandria Ocasio-Cortez.

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