Moneybox

Trump’s Executive Actions Didn’t Even Do the Bare Minimum They Could Have

President Donald Trump holds up the executive order he signed.
Show and tell time. Jim Watson/Getty Images

Like usual, Donald Trump overpromised and underdelivered.

Having failed to strike a desperately needed deal with Democrats on the next round of coronavirus relief, the president defaulted to his backup plan this weekend, signing a handful of memoranda and an executive order that he claimed would keep aid flowing to struggling Americans through the crisis. Before the ceremony at his private golf club in Bedminster, New Jersey, he told the crowd that we has about to sign some “bills” (narrator: they were not bills) that would “take care of, pretty much, this entire situation.”

Of course, they will not. Because Congress controls the power to spend, there really was not much Trump could have legally done on his own to help the economy or households. What’s a bit surprising, though, is that the president didn’t even use his executive authority to help households in all of the ways he arguably could have. Instead, he settled for some undercooked, mostly cosmetic schemes that would give the appearance of trying to help. Typical for this White House, the moves were almost all show, no substance.

Of the four orders and memoranda Trump signed on Saturday, only one will clearly help anybody much at all. The president ordered the Department of Education to continue pausing student loan payments while waiving interest through the end of December. It won’t exactly cure the plague. But it is clearly within Trump’s power as president, and it will make borrowers’ financial lives easier.

Beyond that? His memorandum on housing, which was expected to contain some sort of partial eviction moratorium, did basically nothing, other than declare that it was the government’s policy to “minimize, to the greatest extent possible, residential evictions and foreclosures.” (To be fair, it did set the stage for potential action later on, by instructing his Cabinet to examine various policy options. For now, though, zilch.) He also deferred payroll tax collections, a move that is unlikely to do much of anything either, since most employers are likely to keep withholding money from their workers’ earnings in case they have to pay it down the line. (Trump has suggested he will try to pass a law waiving the liability entirely, but nobody is really going to count on that.)

And then there was Trump’s scheme to continue unemployment insurance, the most confusing bit of his plan. Going into the weekend, many wondered what bizarre legal maneuver the White House would pull to try to extend the $600 per week federal unemployment benefits that expired at the end of July, leaving millions of Americans in the financial lurch. The answer is that he didn’t. Instead, he’s essentially creating a new, parallel “wage replacement” program that will pay $400 a week, using $44 billion from a Federal Emergency Management Agency fund. It is unclear how many Americans will ever actually see this money; the program requires states, which don’t exactly have a lot of spare cash lying around, to cover 25 percent of the cost if they participate (New York Gov. Andrew Cuomo called the proposal “laughable” and an impossibility). It could also take weeks or longer for state unemployment systems to actually set up the payments. And even if they did start flowing, there’s only enough money in the FEMA budget to cover five or six weeks of payments, meaning even in the best-case scenario, the idea is only a stopgap measure.

On top of all that, the entire plan may be illegal, as Georgetown University law professor David Super explains.* Trump wants to create this program using the Robert T. Stafford Disaster Relief and Emergency Assistance Act, which usually governs things like aid to hurricane and flood victims. The statute does explicitly allow FEMA to provide emergency unemployment assistance to disaster victims, but only if they aren’t receiving any other jobless benefits. So Trump is instead trying to use his powers under another section of the act, which allows him to provide households aid “to address personal property, transportation, and other necessary expenses or serious needs resulting from the major disaster.” You can kind of see how a creative lawyer might try to shoehorn unemployment benefits in there. But as Super writes:

If this provision existed in isolation, one might try to stretch it to allow unemployment benefits granted without specifying the “necessary expenses” being reimbursed. But as Congress has provided clear instructions for how the Disaster Relief Fund may be used for unemployment benefits, the President’s action effectively reads those conditions out of the statute. 

You know what the president is definitely allowed to do under the Stafford Act, though? Provide rental assistance to families in disaster zones. So, instead of setting a half-cocked unemployment scheme that might never see the the light of day, the White House could have taken the FEMA budget and used it to head off, or at least mitigate, the wave of evictions that may well be coming our way. Of course, Trump being Trump, he went with the flashy and hollow promise instead.

Ultimately, the main reason to worry about these executive actions is that they are unlikely to do much good for the economy but could conceivably make the White House feel as if it has political cover to delay negotiations with Democrats over meaningful COVID-19 relief for another couple of weeks, during which time hardships for Americans who need the government’s help will continue to mount. If that’s how this plays out, it’s worth remembering that Trump didn’t even bother doing all he could have on his own to help Americans in their time of need.

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Correction, Aug. 10, 2020: This post originally misattributed a blog post by Georgetown University law professor David Super to Yale University law professor Jack Balkin.