After Congress hung the American people out to dry, Trump signed four executive orders to help our struggling citizens. In the midst of the COVID-19 pandemic; not only could Congress not reach an agreement on stimulus spending, they left town for a month. This left the President with no choice but to sign executive orders to help the still struggling ten percent of the country without a job. The House version of the bill, led and pushed by Nancy Pelosi, was fraught with a series of “poison pills” that couldn’t be swallowed by Senate Republicans. Her support of legalized marijuana, bailing out poorly managed states, and other “pork barrel” programs was littered in her version of the bill and contained provisions that she knew would never pass the Senate. In other words, Nancy and her minions left the Hill with President Trump holding the bag. Luckily, the President was ready with a series of Executive Orders to help.
Executive Order on FICA and Medicare Tax Deferral
The first Executive Order, titled “Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster” is a payroll tax deferral from September 1st, 2020 to December 31st, 2020. The deferral of payroll taxes is only related to Social Security (FICA) and Medicare. The order applies to those earning a gross salary of $4000 or less on a bi-weekly basis, or $104,000 annually. This provision will stimulate the economy by providing citizens with extra money in their pockets (resulting from not having to pay social security and Medicare taxes) which is typically spent for necessities or put in a savings account that banks can leverage to issue loans. The problem with a tax deferral is that (like its name suggests) it must be paid back at some point unless Congress comes back and passes legislation to the contrary. The President is counting on this after-the-fact action from Congress as it would seeming be political suicide for Congress to demand re-payment in such austere conditions related to the China-created global pandemic.
Executive Order on Student Debt Relief
The second Executive Order, titled “Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster” defers federally-secured student loans until the end of December, 2020. This action defers payments for millions of borrowers; however, the loans can still be paid if borrowers would like to continue paying on their loans. They just don’t have to until the end of December. This action also provides a stimulating effect to the economy as it puts more money into the hands of consumers to spend.
Executive Order on Assistance to Renters and Home Owners
This executive order made it clear that foreclosure relief would be granted until at least August 31st, 2020 giving home owners time to come up with a plan to cover their mortgage payments. This gives home owners a little bit of breathing room to either make other arrangements or find a way to re-finance their mortgage. The President signaled to HUD that he wanted the Secretary to do everything within the confines of the law to defer rent payments for those living in federally subsidized housing who were affected by the pandemic. This Executive Order was light on details and shifts the majority of the “technical” details to the HUD Secretary (Ben Carson).
Executive Order on Enhanced Unemployment Compensation
This Executive Order provides an additional $400 per week above typical state unemployment compensation. The burden is shared between the state and the federal government, whereby the state contributes $100 per week, while the feds provide $300 per week. This entitlement is expected to last until at least December 4th, 2020 or when assistance balances exceed $25 billion dollars.
What’s Next?
Since these executive orders do, in fact, help the American people, it’s not likely that they will be challenged in federal court; however, anything is possible. The far left side of the Democrat party will do just about anything to see the President fail, so it wouldn’t surprise me if one, or all of the latest Executive Orders are challenged in court. Treasury Secretary Steven Mnuchin stated “Democrats will have a lot of explaining to do” if they want to challenge Trump in court.
