Trump allows some unemployment pay, defers payroll tax

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Copyright 2020 The Associated Press. All rights reserved.

President Donald Trump speaks during a news conference at the Trump National Golf Club in Bedminster, N.J., Saturday, Aug. 8, 2020. (AP Photo/Susan Walsh)

BEDMINSTER, N.J. – President Donald Trump on Saturday bypassed the nation's lawmakers as he claimed the authority to defer payroll taxes and replace an expired unemployment benefit with a lower amount after negotiations with Congress on a new coronavirus rescue package collapsed.

Trump's orders encroached on Congress' control of federal spending and seemed likely to be met with legal challenges. The president cast his actions as necessary given that lawmakers have been unable to reach an agreement to plunge more money into the stumbling economy, which has imperiled his November reelection.

Trump moved to continue paying a supplemental federal unemployment benefit for millions of Americans out of work during the outbreak. However, his order called for up to $400 payments each week, one-third less than the $600 people had been receiving. How many people would receive the benefit and how long it might take to arrive were open questions.

The previous unemployment benefit, which expired on Aug. 1, was fully funded by Washington, but Trump is asking states to now cover 25%. He is seeking to set aside $44 billion in previously approved disaster aid to help states, but said it would be up to states to determine how much, if any of it, to fund, so the benefits could be smaller still.

Many states already faced budget shortfalls due to the coronavirus pandemic and would have difficulty assuming the new obligation.

Trump hopes the four executive orders he signed will signal to Americans that he is acting where Congress will not to address economic fallout from the COVID-19 pandemic, which has upended nearly all aspects of American life. It's unclear what the economic impact of his actions will be, and his orders do not address several areas that have been part of the congressional negotiations, including funding for schools and state and local governments.

House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer dismissed Trump's actions as “meager” in the face of economic and health crises facing Americans. Democrats initially sought a $3.4 trillion package, but said they lowered their ask in talks to $2 trillion. Republicans had proposed a $1 trillion plan.

Trump's Democratic opponent in the presidential race, Joe Biden, called the orders “a series of half-baked measures" and accused him of putting at risk Social Security, which is funded by the payroll tax.