the national interest

Trump Turning Down Pelosi’s Stimulus Deal Is the Worst Political Blunder in History

Photo: Mandel Ngan/AFP via Getty Images

In May, the House of Representatives passed a $3 trillion economic relief bill. Over the next four and a half months, Republicans in the White House and Senate dithered, alternating between good-faith engagement and lethargy. The apparent final blow came in the form of a series of tweets by President Trump announcing an end to negotiations.

It is possible Trump — who just yesterday declared his desire to cut a deal — intends this as one of his “clever” negotiating ploys, enabling him to turn around and make a deal that he can paint as a capitulation by his panicked foes. But even if that happens, the window to boost the economy in time to help him (obviously the only consideration Trump cares about) is closing fast. Walking away from the extended hand of an opposition party willing to pump trillions of dollars into the economy may go down as the single greatest political blunder in the history of presidential elections.

While Trump’s polling advantage on the economy is dwindling — his double-digit advantage has shrunk to a tie — it remains his greatest political asset. It has seemed puzzling to some outsiders that Trump’s economic approval could stay aloft even in the face of mass unemployment. But the employment figures have not told the whole story. The previous economic stimulus bill stuffed so much money into the public’s pockets that household incomes actually rose even in the face of catastrophic joblessness. Stimulus checks and plussed-up jobless benefits have more than replaced the lost income from the recession. People think Trump is good for the economy because they have more money. If they had more money, they would like Trump’s economy more.

Note that Trump, without getting any permission from Democrats, affixed his name to the checks sent out in the last bill. This did not even stop Democrats from offering him the chance to mail out more Trump-branded checks. Pelosi was willing to reduce the size of the next bill to $2.4 trillion, which amazingly was a concession to the incumbent president. Even more amazingly, Trump spurned it as being too generous.

So why have Republicans acted so diffidently to an offer that might have reshaped the campaign in their favor? Conservative ideological dogma has loomed larger than many liberals previously suspected. Republican elites genuinely believe that higher spending, and especially generous unemployment benefits, retard economic growth, and that Trump’s policies of lax regulatory oversight and low taxes on the rich will produce prosperity on its own. Trump is claiming the economy is good, and thus does not require more help. The economy is anemic, and will probably limp along without more assistance.

At first, they were willing to bend their ideology for the benefit of a Republican president. (Had Hillary Clinton been president last spring, they wouldn’t have approved dime one.) But the tension between their ideology and their political pragmatism remained, and the former finally won out among enough Republicans to at least create real internal resistance to a new bill.

The Washington Post reports that Trump reversed himself, and declared the stimulus bill dead, after Senate Majority Leader Mitch McConnell told him Pelosi was “stringing him along” and the Senate did not have enough votes. Of course, there would be plenty of votes for a Pelosi-Trump deal if Trump campaigned for it publicly. But once again – inverting the stereotype that Congressional Republicans are uniformly subservient to Trump – he has allowed McConnell to control him.

The Republican rationale for opposing the House bill has always been that it is a “blue-state bailout,” a reward for irresponsible Democratic jurisdictions. This claim is simply false; the economic crisis has dried up tax revenue and driven up spending needs in states and cities run by Democrats and Republicans alike. State and local governments are required to balance their budgets, which means that it’s difficult for them to be “irresponsible.”

Suppose it were somehow true, though, that Democratic states and towns were exclusively in need of federal help to avoid tax hikes and service cuts. You can see why ideological conservatives might salivate at the opportunity to use a crisis to cut them down to size. But why would Trump want that? Does he think laying off cops and teachers in Michigan, Wisconsin, and Pennsylvania helps him?

Trump has frequently followed his party’s anti-government wing to politically disastrous outcomes. Trump spent most of his first year trying to pass a wildly unpopular partisan repeal of Obamacare, rather than attempting some kind of bipartisan patch-up bill he could rebrand as Trumpcare. He then passed an unpopular tax cut for wealthy heirs and business owners. He abandoned his populist promises to raise his own taxes, crack down on Wall Street, and rebuild infrastructure. All these failures forfeited his crucial 2016 appeal to economic populist swing voters who saw him as more moderate than typical Republicans.

Why did he allow himself to be led by the nose into self-defeating positions? Obviously, Trump knows very little about public policy. He does have some grasp of self-interest though, and has frequently expressed his correct view that it lies in casting aside anti-government dogma and borrowing as much money as he could.

One explanation might be that Trump’s hatred and distrust of Democrats drove him to instinctive opposition. Trump thinks entirely in zero-sum terms, and habitually accuses anybody not working on his behalf of being motivated by a desire to defeat him. Once House Democrats passed an economic relief bill, just months after impeaching him, Trump probably assumed the bill could only hurt him. Or, at least, the fact Democrats passed it so willingly made it easier for right-wing ideologues to convince him that the bill would hurt him.

Trump’s zero-sum mindset is one reason he is awful at making deals. If he has indeed walked away from the House’s offer, he has turned down what may have been his last, best chance to win reelection. Presidents have made worse policy choices before. But it is hard to think of a president who has ever made a purely political decision so predictably disastrous.

This column has been updated.