Paul Waldman asks the question I’ve been worrying about for a few weeks:
Do Republicans even want to help the American economy through this crisis?
. . .
But McConnell knows what’s happening. He has surely looked around and realized that with the pandemic surging, there is simply no way the economy is going to come roaring back before November. He’s seen the polls showing Trump trailing presumptive Democratic nominee Joe Biden by 10 points or more. He knows that the political environment grows less favorable to the GOP by the day. He understands that the odds his party will retain control of the Senate are probably 50-50 at best.
So from where he [McConnell] sits, the best outcome now may be to use the next stimulus package to win some minor ideological victories, but not allow it to be substantial enough to set the stage for a genuine recovery. That way, if and when Biden becomes president in 2021, the situation will be no less dire than it is now — and maybe more so.
And the worse things are in the country at that point, the better it is for Republicans. Just as they did when Barack Obama was president, they can blame Democrats for their own mistakes, then force austerity measures that sabotage the economy and slow the recovery.
If you were a Republican and you thought that Trump was doomed no matter what, this might be your best-case scenario.
I think there is a possibility that this is what McConnell is doing. However, I am not sure of this. It is possible that he is just posturing and angling for more corporate goodies, but will be happy to agree (“reluctantly”) to a large rescue package.
The House Democrats took automatic stabilizers off the table with the HEROES Act, and a large stimulus now that expires just when Biden takes office might be the “best” bet for Republicans – it would maximize their share of seats in the Senate, and position them for “optimal” obstruction even if they lose control. An inadequate stimulus package that creates a full-fledged economic disaster now would be quite risky for the Republicans in narrow political terms. Starting out with an inadequate stimulus package and bargaining for more corporate goodies in exchange for more stimulus might be McConnell’s game, just as in prior rounds.
A few further thoughts.
Republicans will argue for austerity – cluelessly or shamelessly, possibly now and certainly after a Biden win in November – to justify opposition to desperately needed stimulus spending. James Kwak is right to worry that these arguments will lead centrist Democrats to go small.
The $2 trillion stimulus package over 4 years that Biden just proposed last week may not be sufficient, especially if McConnell refuses to pass a substantial bill now. At a minimum, a Democratic stimulus bill in 2021 should have automatic triggers to extend economic support if the economy does not recover, because public opinion will turn against Biden and the Democrats if the recession drags on, and Democratic centrists may focus too much on current opinion polling about “deficits” rather than “latent” or future opinion about “recession” when voting on additional stimulus.
It is hard to say what the Democrats should bargain for without seeing what the Republicans propose, but I think Democrats should offer to let any state end the $600 weekly UI supplement (a “key” Republican demand) if they instead switch to 100% wage replacement of the first (say) 50k in wages, and 75% replacement up to 80k or 100k. Let the states decide. Aid to state and local governments should be close to non-negotiable.
I would seriously consider giving the Republicans corporate liability protection. Sure, it sucks as a policy, but more because it reflects callous indifference to worker safety than because the status quo will actually benefit many people. There are very few lawsuits so far and little reason to expect this to change. If liability protection is symbolically important to Republicans, Democrats could try to pair it with an increase in life insurance and disability payments under Social Security and free coronavirus medical care for all, or they could agree to allow employers to avoid liability if employers agree to pay for workers’ comp that covers lost wages, medical care, and scheduled payments for death and permanent disability due to Covid. (This tradeoff of negligence liability for workers comp is what greased the wheels for workers’ comp originally.) These proposals seem hard to reject – you want people to go back to work without any legal protections, and you’re not even willing to support sick workers or the widows, widowers and orphans left behind? Or Dems can demand that workers remain eligible for UI even if they refuse to return to work. That would allow the most vulnerable workers to protect themselves. Any of these trades would probably be good for workers, especially if they get Republicans to agree to a generous UI program and aid to state and local government.
I can’t say I’m looking forward to watching this play out over the next few weeks.