12.23.2020 0

Trump threatens to veto Covid recovery, omnibus bill, targeting wasteful spending and pushing for more relief

By Robert Romano

President Donald Trump has threatened to veto the $2.3 trillion spending package that includes $900 billion for Covid economic relief plus the $1.4 trillion omnibus spending bill for the annual federal budget.

“I am asking Congress to amend this bill and increase the ridiculously low $600 to $2,000 or $4,000 for a couple. I’m also asking Congress to immediately get rid of the wasteful and unnecessary items from this legislation and to send me a suitable bill or else the next administration will have to deliver a Covid relief package,” Trump said from the White House on Dec. 22.

Additionally, President Trump said that small businesses were not getting enough out of the bill: “[N]ot enough money is given to small businesses. And in particular, restaurants, whose owners have suffered so grievously. They were only given a deduction for others to use in business, their restaurant, for two years. This two-year period must be withdrawn, which will allow the owners to obtain financing and get their restaurants back in condition. Congress can terminate it at a much later date, but two years is not acceptable. It’s not enough.”

Here, Trump is referring to the a $280 billion renewal of the Paycheck Protection Program that saved as many as 5.2 million small businesses and 50 million jobs last spring. That is a little more than half of what small businesses got in the CARES Act this past spring.

Among the wasteful spending items, President Trump cited, “$85.5 million for assistance to Cambodia, $134 million to Burma, $1.3 billion for Egypt and the Egyptian military, which will go out and buy almost exclusively Russian military equipment. $25 million for democracy and gender programs in Pakistan, $505 million to Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and Panama. $40 million for the Kennedy Center in Washington, DC, which is not even open for business. $1 billion for the Smithsonian and an additional $154 million for the National Gallery of Art. Likewise, these facilities are essentially not open. $7 million for reef fish management, $25 billion to combat Asian carp, $2.5 million to count the number of amberjack fish in the Gulf of Mexico. A provision to promote the breeding of fish in federal hatcheries, $3 million in poultry production technology, $2 million to research the impact of down trees, $566 million for construction projects at the FBI. The bill also allows stimulus checks for the family members of illegal aliens, allowing them to get up to $1,800 each. This is far more than the Americans are given.”

Here, Trump has a good point to make, which is that by combining the annual omnibus spending bill — with its usual litany of wasteful line items — and the Covid relief, which is urgently needed, more than half of the spending in the $2.3 trillion package have almost nothing to do with addressing the Covid pandemic and its economic fallout.

But the President also has precious little time to do much about it.

Here, the President can either renegotiate the legislation, veto it now (which would likely be overridden by Congress), or use a rare pocket veto, by simply not signing before the Congressional session ends on Jan. 3, and then, as he said, “the next administration will have to deliver a Covid relief package…”

But that potentially means Joe Biden getting a must-pass piece of legislation, that is, government spending plus Covid relief, in his first 100 days in office. Recall, the $150 billion states bailout that was in the bill last month has now been removed. House Speaker Nancy Pelosi (D-Calif.) wanted $875 billion to bail out states in her $3 trillion version of Covid relief, and will likely want it revived again if she gets another bite at the apple in January.

And it is unclear which party will be in charge of the U.S. Senate next year with the Georgia runoffs still ongoing. As Senate Republicans consider the President’s demands, it’s something they would do well to consider.

So, there are risks involved with the President’s strategy. The question is whether the legislation can get any better right now. It might, but only if the President can successfully renegotiate the legislation before Jan. 3 and pull out the wasteful spending, and provide more needed relief to small businesses and the American people.

But President Trump has a rapidly diminishing window of opportunity to act, and after Jan. 3, House Speaker Nancy Pelosi (D-Calif.) will have very little incentive to do another deal prior to Jan. 20, potentially handing Biden a big opportunity to enact his agenda in January. Stay tuned.

Robert Romano is the Vice President of Public Policy at Americans for Limited Government.

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