President Trump has instructed Treasury Secretary Steve Mnuchin and other officials to halt negotiations for a new coronavirus relief bill until after the November elections.
The announcement came hours after Federal Reserve chairman Jerome Powell pleaded for Congress to pass additional economic relief legislation. However, the Democrat-led House and Republican-majority Senate have been unable to agree on a price tag for the bill. Democrat have pushed for a $2.4 trillion package, while Senate Republicans have been hesitant to pursue another round of massive government spending.
Stocks plummeted following the president’s tweets, with the Dow Jones, S&P 500, and Nasdaq all dropping by over one percent.
“Nancy Pelosi is asking for $2.4 Trillion Dollars to bailout poorly run, high crime, Democrat States, money that is in no way related to COVID-19. We made a very generous offer of $1.6 Trillion Dollars and, as usual, she is not negotiating in good faith,” the president wrote on Twitter on Tuesday. “I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill.”
…request, and looking to the future of our Country. I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business. I have asked…
— Donald J. Trump (@realDonaldTrump) October 6, 2020
A Trump-campaign adviser criticized the president’s decision in comments to Axios.
“You have to try to be this politically inept,” the adviser said. “What is going on in the White House? Where is Mark Meadows?”
However, Senate Majority Leader Mitch McConnell (R., Ky.) told reporters that he supports Trump’s decision.
“I think his view was that they were not going to produce a result and we needed to concentrate on what’s achievable,” McConnell said.
Earlier on Tuesday, Powell said that failing to move forward with a relief bill could “lead to a weak recovery, creating unnecessary hardship for households and businesses,” in remarks to the National Association for Business Economics. “By contrast, the risks of overdoing it seem, for now, to be smaller….Even if policy actions ultimately prove to be greater than needed, they will not go to waste.”