Trump bypassed Congress to give generously and was accused of robbing the east to pay the West

On August 8, local time, after the negotiations with people reached a deadlock, US President trump “bypassed” Congress and signed several executive orders, including providing the unemployed with an additional unemployment allowance of $400 a week, and deferring part of the payroll tax. Many economists pointed out that these temporary relief measures introduced by the White House have the characteristics of “robbing the east to pay the west”, which may harm the social security system and cause antagonism between employers and employees. These seemingly “generous” measures will make the American society pay many unexpected costs. On August 8, trump instructed the federal government to provide additional unemployment benefits of $300 a week to the unemployed, and called on the States to fund another $100, equivalent to $400 a week for the unemployed Additional relief of $1. < / P > < p > in the Care Act passed by the US Congress in March this year, it includes the measure of providing an additional $600 per week federal unemployment subsidy to the public, but this subsidy was stopped on July 31. Although the outside world has called on Congress to pass a new round of rescue measures as soon as possible, the democratic and Republican parties have been arguing over the amount of the new measures and have not yet reached a compromise. In this case, trump announced to bypass Congress and issue money to the unemployed by executive order, hoping to win the favor of some swing voters in the sprint stage of the general election. < / P > < p > according to the Wall Street Journal, the latest additional unemployment benefits will last until December 6, about a month after the November 3 election. Among them, the upper limit of federal funds is $44 billion, which will be allocated from the disaster relief fund, which is the main source of government emergency spending, usually for natural disasters. The balance of the fund is currently about $70 billion. < / P > < p > however, it has been noticed that the White House’s generous donation can be described as “less thunder and less rain”. In addition to using the existing disaster relief funds, it also asked the state government to pay together. According to the executive order, the federal government only provides 75% of the $400 a week subsidy, and the rest needs the States to find their own way. In fact, the novel coronavirus pneumonia has caused a significant decline in revenue in many areas, and some states have applied for more assistance to Congress. Now the new fiscal burden is coming, which will make state governments even more shyness. < / P > < p > Andrew hesby, an economist with Bloomberg, pointed out that the White House instructed the States to use part of the $150 billion relief fund included in the care act, while the federal government will use $44 billion of the existing $70 billion relief fund, “because trump plans to use the existing pool of funds to provide unemployment relief, the limited funds are likely to be in short supply before the election.”. < / P > < p > Richard Neal, a Massachusetts Congressman and chairman of the house ways and Means Committee, said: “legally and logically, the plan proposed by the president is difficult to implement in almost every state, and the funds in the plan are far from meeting the actual needs.” Economists at Goldman Sachs said in a research report: “the extra $400 unemployment benefit may only last for one month.” < / P > < p > another controversial executive order signed by trump this time involves part of the deferred payroll tax. According to the executive order, employees with an annual income of less than $100000 can be deferred from September 1 to December 31. Trump said that if he was re elected president in November, he might extend the deferral period of the payroll tax and push for permanent cuts. < / P > < p > “this kind of false tax reduction measure will be a big blow to the workers who think they will get the tax reduction, because it is only a deferred tax.” “These workers will face greater financial pressure in the future,” Ron Wyden, a senator from Oregon and member of the Senate Finance Committee, said in a statement < / P > < p > at the same time, because the payroll tax is the source of income of the federal pension system, which is used to pay for the federal pension insurance, if the levy is suspended, it means that the elderly in the United States may “pay” for it. As Richard Neal, a Massachusetts Congressman and chairman of the house ways and Means Committee, said, Trump’s move will undermine the financial security of American retirees. < / P > < p > according to the data of the center for budget and policy priorities, a us think tank, the payroll tax that began to be levied after the great depression is the largest single source of income for the elderly in the United States, providing most of the income for half of the retirees and at least 90% of the income for 18% of the retirees. At present, with the retirement of the huge baby boomers, the government has been facing huge pension payment pressure. Trump’s move is more like a dangerous gamble to further reduce the source of income by deferring the payroll tax. On August 8, Biden, Trump’s Challenger in this year’s election, said trump was “putting social security at serious risk”. Biden said the president’s move was the first shot in the war on social security programs because he did not come up with a plan to fill the funding gap. < / P > < p > trump signed the two executive orders at his golf club in Bedminster, New Jersey, where he was spending the weekend. Other actions include the extension of a student loan interest payment waiver and the suspension of eviction orders. < / P > < p > in recent two days, the economic impact of these measures has been controversial, especially the deferred payroll tax. Economist Stephen Moore, an ally of trump, believes that the deferral of payroll tax is equivalent to $300 billion in tax cuts, which will help the economy recover. But other economists said the move was unlikely to provide substantial stimulus to the US economy. < / P > < p > “wage tax deferral will continue until the end of the year, but consumers may be hesitant to use up the extra income without changing the tax law.” Alec Phillips and black Taylor, economists at Goldman Sachs, said. Although these measures are better than none, the subsidies for the unemployed are much less than those in previous months, and the deferred payroll tax can not help tens of millions of people who have lost their jobs, according to the analysis of the Peng Bo news agency. < / P > < p > in addition, deferral of payroll tax may cause tension between employers and employees. Since the payroll tax should be withheld and remitted by enterprises at the time of monthly wages, if enterprises suspend withholding and distribute the surplus money to employees at this time, they may face the difficulty of recovering funds in 2021. If some employees have left, the situation will become more complicated. However, any continued withholding will cause dissatisfaction among employees. In this case, the enterprise may face the dilemma of “inside and outside are not people”. < / P > < p > faced with such an embarrassing situation, enterprises may choose to do nothing at all, because they don’t want to be caught between employees and the government. “The idea of deferring payroll taxes and expecting companies to comply with executive orders is simply illogical. They may have to ask employees for money in the future, unless Congress cuts payroll taxes permanently. ” “And it’s not the people who are paid, it’s the people who are not,” says Diane Swank, chief economist at Grant Thornton in Chicago