The Current Industrial Cycle (Pt 2)

After Congress deadlocks, Trump issues decrees

On August 8, Donald Trump at a meeting of wealthy members of a New Jersey country club he owns announced a series of Executive Orders. These decrees supposedly dealt with the problems of unemployment insurance and mass evictions. Trump claimed they would protect the expanded unemployment insurance unemployed workers have received under the emergency CARES Act passed last March and extend the moratorium on evictions that was part of the Act. Trump also claimed he is giving workers earning less than $100,000 a year — essentially all people who can reasonably be considered “workers” — tax relief through a payroll tax cut. The tax cut is only a moratorium on the collection of the employee contribution — collected by the boss — to finance the Medicare and Social Security trust funds. Trump, however, indicated that if he is re-elected to a second term he will make the abolition of the payroll tax permanent.

The background to Trump’s announcement was the July 31 expiration of the expanded unemployment benefits of $600 a week and the moratorium on evictions. Under the CARES Act, the government handed out trillions of dollars to the capitalists under the pretext of counteracting the effects of the economic collapse associated with the COVID-19 pandemic. But the CARES Act also included a few “sweeteners” for the working class. These included expanded eligibility for unemployment insurance and an increase in unemployment payments by an extra $400 a week plus a federally mandated moratorium on home foreclosures and evictions.

These measures have indeed been a lifeline for the tens of millions of people who have become unemployed since March. However, there was a catch. Under the CARES Act, the moratorium on evictions and the extra $600 in unemployment insurance were to expire in only four months. The Democrats and Republicans, and above all Trump, “assumed” that the pandemic would be over by July 31 and that the millions of people who lost their jobs in March and April would be back at work by then.

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