Stimulus

On the Art of 'Stimulus' Spending With Trump and Pelosi

The president might just be the world's worst negotiator.

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President Donald Trump is one of the worst negotiators I have ever seen. One day, he tells House Speaker Nancy Pelosi (D–Calif.) that the stimulus talks are over because she insisted on at least a $2 trillion deal and rejected the White House's offer of $1.6 trillion. The next day, without Pelosi lifting a finger, the president comes back with an offer of nearly $1.9 trillion. Maybe if Pelosi waits, she'll get her full $2 trillion after all.
Setting the puzzling negotiation tactics aside, this carelessness about American taxpayers' money is shameful.

I know that everyone is supposedly now a Keynesian, and the refrain inside the D.C. Beltway is that failure to reach yet another so-called stimulus deal would guarantee economic disaster. In spite of evidence that government spending isn't a miracle cure for the economy and that it's often a bad investment, many Washington insiders lamented the president calling Pelosi's bluff by saying that enough was enough and that negotiations were over. Until they weren't.

So, here we are today. The White House's new $1.88 trillion offer would reallocate $400 billion of the unspent funds from the previous COVID-19 legislation, for a total cost of about $1.5 trillion. Some Republicans find this apparent surrender by the administration to be incredible, especially because the White House proposal looks almost identical to the Democrats' bill. As the saying goes, with Republicans like that, who needs Democrats?

Both sides want to send more checks to people. While the spending might not stimulate the economy, there's no denying that some Americans' lives will be made easier if they get $1,200 checks. But let's be honest about this; for some pundits and politicians, sending out these checks isn't to relieve the pain of a locked-down economy. In fact, many commentators complained that it was a poor political calculation on the president's part to not send these checks as a preelection gift to voters. Apparently, the president received that message loudly and clearly. The question still unanswered is whether he will also cave and agree to broaden eligibility for a second round to those without Social Security numbers.

As for the rest of the bill, it's stuffed with programs that promote economic stagnation and even more indebtedness. For instance, both Pelosi and Trump want an unemployment bonus on top of regular unemployment benefits. Pelosi wants to renew the $600 weekly bonus, while Trump wants it to be $400. According to the Congressional Budget Office (CBO), the economic impact of each dollar of extended unemployment benefits already extended to Americans since April is roughly 67 cents. The CBO also calculated that if Pelosi's original $600 benefit were continued, the cost of the bonus plus employment insurance would shrink the economy, due, in part, to disincentives to work.

For the duration of the pandemic, Trump also wants to expand—surely to the delight of Pelosi—the Affordable Care Act's subsidies for people who have lost jobs and hence lost their insurance, to buy insurance through the individual market. Needless to say, many Republicans see this proposal as yet another a betrayal. And they are correct.

They both support another misguided $25 billion airline bailout that will be a waste to taxpayers. They pretend that they want to help airline workers, even though academic research also shows that bailouts benefit mostly shareholders and creditors more than workers. They both want to spend hundreds of billions of dollars for state bailouts, too. Pelosi wants over $400 billion for states, cities, and tribal lands, while Trump wants $300 billion. As I've argued many times over, bailing out the states would be irresponsible. Why shouldn't state and local officials have to trim their budgets to adjust to this post-pandemic reality, just like everyone else?

As we prepare to spend many more trillions of dollars in "stimulus," it's obvious that Democrats and Trump administration officials resist the reality that the problem with the economy isn't a lack of demand, so a Keynesian spending bill won't help much.

Most of the economic issues continue to come from the restrictions on commerce in many states and the fact that consumers are wary of catching or spreading the COVID-19 virus. No level of magical thinking and spending will really boost the economy under these circumstances.

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  1. We should have two Presidents, a Republican and a Democrat. We can give them each $5 trillion and see how creatively they can spend it. The Supreme Court can be the same and of judges.

    1. panel of judges

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  2. Well since the stimulus full of inflated funny money to keep Wall Street traders happy didn’t pass muster I’d say Trump did his job well. Meanwhile crazy Nancy is spewing spittle in television interviews. She might be the worst super spreader of all time. Fortunately KY jelly is still available for her husbands shriveled dong. Although without the stimulus she might be the man tonight.

    1. good old kentucky jelly…making the gnarliest of dried holes passable, but good god man, please don’t tell us about it

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  4. While the spending might not stimulate the economy, there’s no denying that some Americans’ lives will be made easier if they get $1,200 checks.

    Poppa needs a new pair of shoes. I don’t need money but I hate to spend it so a government check I didn’t ask for is great for kicking a necessity up in to to the luxury class. American or Italian shoes handmade of high quality materials for example, rather than that shit shoddily stitched together by some concentration camp-dwelling unmutual Uighur whose mind is more occupied with the horror of his wife getting grudge-raped by low level apparatchik Han than doing a good job making the cheap shoes that you fucking globalists want me to buy.

    1. You make political decisions based on this distorted worldview.

      1. Are you saying there’s no Uighur slave camps making affordable sneakers?

  5. Trump is such a bad negotiator, Nancy Pelosi is breaking down live on CNN calling Wolf Blitzer and the network a shill for Trump.

    Good call.

    1. That was possibly the most hilarious moment of 2020.

      Though if I recall correctly, there was at least one other msm talking head that was attacked by Crazy Nancy.

    2. So, the point of the negotiations is to drive Nancy crazy, not to help people. Got it.

      1. Well, the point of negotiation is not to help people, so….

      2. yeah government helps people …

        1. But don’t worry, White Knight is a “real” libertarian.

  6. If I remember correctly Pelosi first started with a price tag of 3 trillion a while back.

    1. Hush, the idiot author isn’t done emoting.

      1. To think this was the follow up to Boehner masterpiece yesterday. I guess since they basically admitted they were all ex democrats (in reality still basically democrats) in the vote thread… they aren’t bothering to even attempt hiding their left leanings anymore.

        1. Lol, you said Boehner.

        2. Do you ever recount anything accurately.

          1. He does and did, shill.

      2. Not that long ago. The whole summer in fact

    2. And it’s not just the number, it’s what they propose to spend it on. Pelosi could come back with a 1.6 trillion bill and Trump a 2 trillion bill and they could still be completely different from the previous offerings

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  9. “The president might just be the world’s worst negotiator.”

    And this might be a libertarian web site.
    PhD or not, you are missing the point that so far, the amount is zero.

    1. so far, the amount is zero.

      No currently it stands at 2 trillion (CARES Act), now they are negotiating whether it will stay 2 trillion, or jumps to 3.9 to 5 trillion.

      1. Different bills, different negotiations.
        (But I really enjoyed the movie)

    2. “President Donald Trump is one of the worst negotiators I have ever seen.”

      This opening statement reads like something an 8th grade student would write to please her hate filled “woke” social studies teacher.

      1. That awful negotiator got peace deals from the Taliban, Israel, the UAE, Bahrain, Serbia and Kosovo, and a far better free trade agreement than NAFTA.

        If only he were as good a negotiator as Bush and Obama, maybe America could have had more lovely perpetual war and stuff.

  10. Maybe four years ago I would be shocked and appalled to see a self-described libertarian magazine publish article after article excoriating the President for not wanting to spend nearly $4 trillion worth of pork and declaring that the path back to fiscal responsibility lay with electing the Democrats proposing this $4 trillion abomination.

    But it’s 2020.

    1. We have already spent 2 trillion and now the Trump admin’s position is another 1.9 trillion. But I guess your right, libertarians should be happy that the total number isn’t 5-6 trillion. Thank you Donald, for only agreeing to waste 2 trillion dollars, so far.

      1. I’m not happy about $2 trillion in spending, I’m pointing out the absurdity of saying that the Democrats will fix our fiscal mess.

        1. This is not hard: A libertarian criticizing Republicans does not equal their supporting Democrats.

        2. Who said that and where?

    2. Poor reading comprehension? There was nowhere anyone from Reason said they want the money to be spent.

  11. The president might just be the world’s worst negotiator.

    LOL!!! Everybody knows that Trump is the world’s greatest negotiator, he’s a fucking DEALMAKER, that’s what he does! He makes deals! The best deals, the greatest deals, deals like you wouldn’t believe! And everybody knows Trump is the world’s greatest negotiator! Why, if Trump were in fact the world’s worst negotiator while he’s got everyone convinced he’s the world’s greatest negotiator, he’d have to be the world’s greatest conman! LOL!

    Oh, wait…

    1. Trump is a good con man. While he can convince many, he can not convince all and that his problem. Speaker Pelosi, and many others, see right through him.

      1. The rich white geezers of the Democrats don’t understand anything other than using corruption, demagoguery, sexual favors, nepotism and influence peddling to enrich themselves.

        1. They understand Trump and that is a problem for him.

          1. They don’t have a clue about how Trump sells himself, otherwise they wouldn’t have lost in 2016.

            And “con man” implies that Trump isn’t delivering what he promised; in fact he is: conservative judges, less foreign involvement, renegotiated NAFTA, peace deals, cutting regulations, lower taxes, etc.

            That’s the complete opposite of Obama, who often did the opposite of what he promised. And the argument for Clinton and Biden, who were/are running on disastrous party programs is basically “don’t worry, they are lying in order to get elected; once in power, they’ll just give you the same crap they have given you for decades.”

          2. No they don’t and that’s why they hate and fear him.

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  13. If one sets their partisanship aside, if one looks at the man as a person rather than their tribal leader, if one steps out of the knee-jerk gainsaying, it’s clear this man is a very bad negotiator. There are legions of New York and New Jersey businessmen who refuse to ever do business with him again.

    He got his reputation because he’s an insider. He has had deep political connections to city and state governments for a very long time. Maybe he was never D.C. swamp, but he was NY and NJ swamp for decades. He made it to the top in a very narrow field that requires deep government connections to succeed in. Don’t forget, he’s been bankrupt four times. That’s four times the system has bailed him out. Not a good negotiator.

    Yes, he’s in a position where he is the elephant in the room. Others in the negotiation HAVE to deal with him. Just because he’s the president. That doesn’t mean he’s a good negotiator. Other people would take that strong position and get something for their team, but he seems like he just wants to throw monkey wrenches in the system. He only cares that Pelosi won’t “win”, whatever “win” means in this situation.

    Frankly, I don’t care. I don’t want compromise on this ridiculous amount of spending. I want zero stimulus because the problem isn’t the flow of cash to cronies. But a better man would be honest about it and just say no, rather than backhand every good faith effort with random tweets.

    Maybe it’s just 5D chess going on, but there’s zero evidence that it is. That’s just shit people make up so they don’t have to admit we have a bull in the White House china shop.

    1. So far, there is zero dollars of additional spending. Nancy looks like the fool she is.

      And what matters to conservatives at this point isn’t another $2T in spending, which make little difference to the fiscal disaster we already have, but winning.

      1. So far, there is zero dollars of additional spending.
        But there have already been 2 trillion dollars spending. What they are quibbling over is whether they will spend an additional 1.9 or 2 trillion more.

        If this is what “winning” looks like I don’t want to play anymore.

        1. That’s why I said “So far, there is zero dollars of additional spending.”

          I think the first $2T were a bad idea, but they were non-negotiable: Congress and the American people wanted them, and it wasn’t the job of the executive branch to stop this.

          1. The original $2T was something I was willing to live with because government caused the problem, government should pay up.

            But at this point, there is no federal lockdown (and never was), so federal $$ going to bail out idiots who vote for shitty governments should not be bailed out by people who have better sense.

            1. And that’s why it is good that nothing else has happened. I.e., the failure of reaching an agreement with Pelosi while making her look like the cadaverous fool she is is a good thing.

          2. but they were non-negotiable
            These goalposts are moving faster than the speed of sound. Says who they were non-negotiable? Why is it that Trump gets a free pass for signing his name on the fucking checks the first time but now gets credit for not yet having spent just as much money again (even though he is offering to do exactly that).

            Imagine if Donald Trump was holding hostages and had already killed one and has his gun pointed at the head of a second but people still want to call him peaceful because he hasn’t pulled the trigger on the second hostage yet. Offering to spend 1.9 trillion instead of 2 trillion does not make one fiscally responsible. It is not a “compromise”. It’s not the lesser of two evils in any meaningful sense. It is willful self-delusion.

            1. Says who they were non-negotiable? Why is it that Trump gets a free pass for signing his name on the fucking checks the first time

              “Free pass”? The vast majority of Americans wanted this to happen. Many wanted it because they wanted to help desperate people. It helped avert a stock market crash. Even libertarians argued for it, because if the state destroys your job, the state has an obligation not to let you starve.

              but now gets credit for not yet having spent just as much money again (even though he is offering to do exactly that).

              The situation is different now. People have had time to adapt and find new jobs and the money isn’t needed as urgently. We also have COVID under better control.

              Trump had a strong justification and motivation for supporting the first $2T. The second $2T are much less justified and much more political, and Trump is treating them as such.

              1. Even libertarians argued for it, because if the state destroys your job, the state has an obligation not to let you starve.
                Which libertarians argued for it?

                Ugh, this is getting off track. Regardless of who may have argued for it those people were/are/always will be wrong. Impoverishing millions of Americans with lockdowns was awful enough. Saddling them with two
                T
                R
                I
                L
                L
                I
                O
                N

                dollars ($2,000,000,000,000) of additional debt was flat out evil. It doesn’t matter if they wanted it. If a crack addict wants another hit does that mean it’s the right thing to give it to him? Nevermind that amount of cash was enough money to cut every man, woman, and child standing on US territory a check for almost six thousand dollars. The amount of it actually sent to some of them was only a fraction of that, the rest disappeared into the pork barrel.

                The situation was not different then. There was never an emergency (only the ones the government itself created). Your argument is that the government’s solution to a problem was so bad that the government had to create a solution to solve the problems with its own solution, a solution to a solution that creates yet even more problems than the initial solution to the problem.
                https://www.youtube.com/watch?v=LuiK7jcC1fY
                “No, that’s the beautiful part. When wintertime rolls around the gorillas simply freeze to death.”

    2. Explain the peace deals from the Taliban, Israel, the UAE, Bahrain, Serbia and Kosovo, and USMCA, a far better free trade agreement than NAFTA.

      That’s far more than the last four presidents accomplished.

      1. Jared Kushner gets a lot of credit for the Israel UAE Bahrain deal. He has been working on it since the election. Granted there was slow normalization going on before that as there has been with the Saudis and those countries were never at war but he sealed the deal.

        The gulf Arabs never had any particular problems doing business with the Jews, or anyone else for that matter. They are in the same category as Christians to them.

        Plus like everyone else they are sick and tired of the Palestinians. The Saudis have put up one peace proposal after another and the Palestinians blow it every time.

  14. Result of negotiations so far: $0 additional money spent by Congress, Trump can take credit for executive branch emergency support, Nancy loses it badly on TV and attacks liberal journalists as Trump stooges. Seems to me that Trump is getting what he wants. At this point, Nancy is so crazy that Trump could offer her her original demands and she would refused.

    Note, Verony, that what you ask for in a negotiation and what you want as an outcome are two different things.

  15. Trump is a master negotiator when he is in the power position. So when he is negotiating with contractors or for services he can use the leverage of his wealth. Problem is that he is no good among equals like Speaker Pelosi or the government of China. A number of top US businessman, Bloomberg, Bezos, Cuban, etc., don’t deal with Trump.

    1. And Pelosi is ruthless. Her daughter said something like “she’ll cut your head off and you won’t even know you’re bleeding”.

    2. Problem is that he is no good among equals like Speaker Pelosi or the government of China.

      Evidence?

      A number of top US businessman, Bloomberg, Bezos, Cuban, etc., don’t deal with Trump.

      I don’t particularly like Trump, but those are pretty nasty people too. So what’s your point?

  16. Trump is a grotesque orange object lesson in why you should tax inheritance more.

    1. Pelosi is a grotesque botox-addicted fool who is an object lesson in why we shouldn’t vote for people whose life accomplishments consist of marrying into money.

    2. I’ve always been fine with raising the inheritance tax. It’s one of the few things I agree with Democrats on. Only difference is, I want whatever tax revenue the estate tax would generate to be cut from the income tax; in essence, I want some transfer of taxation from income to inheritance.

      We should live in a society that rewards strivers and makers, not silver-spooned brats.

      1. Problem with an inheritance tax is that we’re usually talking about wealth, not money. So if someone inherits the family farm or business, they often have to sell it just to pay the taxes. That doesn’t seem just to me. Why shouldn’t strivers and makers be able to pass their wealth, and their means of creating more wealth, onto their children?

        Because you’re jealous?

        1. We’re taxing anyway. Why not start with the brats who didn’t lift a finger to make that money except being born?! That’s my whole point. I don’t want to raise taxes generally. I just want to transfer some of the tax burden from income to inheritance.

          Now, the technicalities of what kind of inheritance gets to be passed on, that, I leave to the bureaucrats and all the rest. Those who have businesses generally have cash in the bank. And if not, they’ll pay the taxes later as the profits from the business keep coming in.

          1. “…they’ll pay the taxes later …”. You mean using the optional installment payment plan the IRS offers? LOL.

      2. Taxation is theft but inheritance tax is the greatest theft of all of them.

        1. Hell, no! Nothing hurts more than the direct fruit of your labor being straight-away taken from you, aka income tax. Inheritance tax is just some brats who happened to be born. There’s no labor, there’s no effort there! And as to the parents passing on the inheritance, again, I want to take less of their income, so it all evens out.

          1. Some people spend their lives building a business or farm exactly because they want to pass it on so their kids will have a better life.

            Me, my plan is to spend it all. The last check should be to the undertaker and it should bounce. If you want to help out the kids do it while you are alive.

            Who are you to take those choices away from people because of your idea of “deserving”. It’s none of your business. Besides if you have real money there is always a way to get around inheritance tax. People do it all the time. It is a normal part of retirement planning.

          2. If you want to lower income tax take the libertarian approach as I do. Advocate for smaller government, much smaller. Advocate for free trade and better economic policy which will increase revenue without the need for more taxes.

            1. Well, you’re a complete failure

    3. ^Tony with the most honest and least passive aggressive comment from a leftist on this article

  17. Trump’s objection was that he didn’t want the blue states bailed out, not that they were spending too much. That’s why he ended the deal, and that’s why he reentered the negotiations.

  18. How DARE Reason criticize Trump! They’re all Democrats! Every single one! Only a Democrat would criticize the conservative god king! He’s a better president than Saint Reagan! Vote for Trump! Vote for awesome!

    1. Hahahahahaha. Thanks for the laugh.

  19. “…the White House proposal looks almost identical to the Democrats’ bill. As the saying goes, with Republicans like that, who needs Democrats?”

    Beyond his being an old geezer, Trump was Democrat and a big Democrat donor, including to the Clintons and Harris, for longer than I have been alive. Despite his being the quintessential New York City sewer rat, Trump is best understood as a Dixiecrat virus infecting the Republican Party. This understanding goes far in explaining the much greater Trump and Trumper animus for (L)libertarians and conservatarians than for Democrats.

    1. This article apparently written by a teen.

  20. What this article shows is that Ms. deRugy is poorly informed.

    The Pelosi bill that Trump rejected was the HEROES Act, and contains a huge list of provisions that have nothing to do with stimulus spending — it’s mostly a Democratic wish list, including things like legalizing ballot harvesting and voting by mail nationwide. Most of the items in the list are outrageous, and the HEROES Act was written with the intention that it never pass — so that the Democrats could pretend that President Trump is the one preventing a second bill like the CARES Act from being enacted.

    Fortunately, no one is listening to the Democrats anymore, not even their core voters, partly because of today’s Biden story.

    1. Actually very clever move by the dems. All the voters will hear is that Trump is a skinflint and didn’t give them bigger checks. Trump got out maneuvered.

      1. Echospinner, proving just how much of a simp to the left he can be.
        Hey, how’re your fellows doing with the leftists in New York?
        How many have you informed on?

        http://twitter.com/RubinReport/status/1316824349320466432?s=19
        .@NYGovCuomo is sending around plainclothes agents to photograph the inside of synagogues to make sure that no one is praying.
        Are we back to 1930’s Nazi Germany?

    2. Oh that Biden story. I don’t think they will care much about that. Hunter is such a tool and everyone knows it. We don’t know but the whole thing sounds kinda fishy anyway. Not going to be a deal breaker.

      The only voters that matter are the ones who voted against Hilary last time and question is will they vote against Trump this time.

  21. Trump isn’t the world’s word negotiator. He’s just the world’s worst. And besides, he’s Q. 17 y’all.

    1. Oh Jesus Fucking Christ. I just realized I wrote “Trump isn’t the world’s word negotiator. ” It should have been “Trump isn’t the world’s worst negotiator.” Oh well, I’m sure you all figured it out anyway.

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