WASHINGTON/BEDMINSTER • US President Donald Trump vowed to unilaterally suspend payroll taxes and extend expired coronavirus unemployment benefits after negotiations with congressional Democrats on a broad pandemic aid package collapsed on Friday.
Mr Trump told a news conference at his golf club in New Jersey that he will sign an executive order implementing these measures, suspending student loan repayments and rental housing evictions in the coming days if no deal is reached.
He said the payroll tax suspension – a move he has long called for but is shunned by both parties in Congress – would be retroactive to July 1 and extend to the end of the year, with a possible extension into next year if he is re-elected.
He said the order could be signed by the end of the week, without specifying whether he meant last week or this week. He said he expected it to be challenged in court.
“If Democrats continue to hold this critical relief hostage, I will act under my authority as president to get Americans the relief they need,” he said at the briefing, which took on the look of a campaign event.
Earlier on Friday in Washington, Mr Trump’s chief of staff, Mr Mark Meadows, and Treasury Secretary Steven Mnuchin said there was no progress in negotiations at the Capitol with the two top Democrats in Congress – House Speaker Nancy Pelosi and Senate Democratic leader Chuck Schumer.
The global pandemic has taken a particularly heavy toll on the United States, where it has killed more than 160,000 people and thrown tens of millions out of work.
Mr Trump initially played down the threat of the disease and drew criticism for inconsistent messages on public health measures like mask wearing and social distancing.
Friday’s talks appeared to mark the end of nearly two weeks of almost daily closed-door negotiations between the four leaders, who have sought to hammer out an agreement on legislation to resume Covid-19 relief programmes that expired at the end of last month.
Democrats said they offered to reduce a proposed US$3.4 trillion (S$4.67 trillion) coronavirus aid package, which the House passed in May but the Senate ignored, by nearly one-third if Republicans would agree to more than double their US$1 trillion counter offer.
Mr Trump’s negotiators turned them down.
“It was a disappointing meeting,” Mr Schumer told reporters.
Both sides said they remained open to further negotiations. “I will be back here any time to listen to new proposals,” said Mr Mnuchin, who identified the roadblocks as funding for state and local governments and an extension of enhanced unemployment payments, a US$600 per week lifeline for those who have lost jobs in the coronavirus crisis.
Mrs Pelosi said she gave him and Mr Meadows a stern parting message: “Come back when you’re ready to give us a higher number.”
It was unclear how much any president could do by executive order.
At his news conference, Mr Schumer said the President could not order any new money spent – as that is the power of Congress – but could only defer costs until they were eventually paid.
The US Constitution gives Congress authority over federal spending, so Mr Trump does not have the legal authority to issue executive orders determining how money should be spent on the coronavirus.
Mr Trump has managed to sidestep Congress on spending before. Last year, he declared a national emergency on the US-Mexico border to shift billions of dollars from the defence budget to pay for a border wall he promised during his 2016 election campaign.
Mr Schumer placed some of the blame for the lack of progress on 20 Republicans in the Senate greatly influenced by the conservative Tea Party: “They don’t want to spend the necessary dollars to help get America out of this mess. Ideology sort of blinds them.”