President Donald Trump has been threatening to veto the coronavirus relief bill that Congress passed on Monday, December 21 because he considers its $600 in direct payments inadequate. Liberal economist and New York Times columnist Paul Krugman analyzes the bill in a Twitter thread, and for once, Krugman and Trump actually agree on something: $600 in direct payments isn't enough.
Republicans and Democrats in Congress had plenty of disagreements when the details of the bill were being worked out. Eventually, they agreed on $600 in direct payments to Americans, but the president expressed his disapproval and declared that $600 was insufficient. Democrats in the House, during a session on Christmas Eve Day, responded by trying to pass $2000 in direct payments, but House Minority Leader Kevin McCarthy opposed. And Senate Majority Leader Mitch McConnell also believes that $2000 payments, which is what Trump is asking for, would be too costly.
The CARES Act, passed by Congress in March, included direct payments of $1200.
Krugman tweets, "Dems are gleefully signing on to Trump's demand for $2000 checks, hoping to embarrass Rs; fair enough. And it would do no harm, since debt is not a problem given negative real interest rates. But the way this is playing out is still bad news for the future."
Although Krugman has been a blistering critic of Trump, the Times columnist agrees with him that $600 in direct payments is too little. But Krugman parts company with Trump by saying that even $2000 is insufficient in light of all the economic misery the COVID-19 payment has inflicted.
"For someone who won't have earnings until we have mass vaccination," Krugman explains in his Twitter thread, "even a $2000 check isn't remotely enough to compensate for the loss of that $300 a week extra unemployment benefit starting in mid-March 3. So we're short-changing people in desperate straits, while handing out checks to people who don't need them. This may be good politics, but it isn't good policy."
Krugman, in his Times column, has been stressing that while some Americans have continued to prosper during the pandemic, others have suffered months of unemployment and are struggling to pay their bills. Those who fall into the second category, according to Krugman, need a lot more help than a $2000 direct payment from the federal government — while Americans who haven't lost any income because of the pandemic don't really need a direct payment.
"To be honest," Krugman tweets, "it's kind of a relief to be criticizing bad analysis rather than raw, malevolent dishonesty. And I don't blame Ds for going with the flow. But this really isn't the right answer to our current situation."