On The Money: Administration defends Trump executive orders | CBO reports skyrocketing deficit | Government pauses Kodak loan pending review

by Niv Elis - 08/10/20 5:39 PM ET

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THE BIG DEAL—The administration is defending President Trump’s signing of coronavirus relief executive orders after congressional negotiations stalled. But critics were quick to point out that the orders relied on questionable legality, could take months to implement and fell far short of what could be done legislatively.

One memo extends the enhanced unemployment benefits that expired roughly two weeks ago and have been critical to millions of Americans out of work due to the pandemic. The benefits will be lowered from $600 to $400 per week, with states required to cover 25 percent of the cost, Trump said.

Another of the orders directs the Treasury Department to allow employers to defer payment of employee-side Social Security payroll taxes through the end of 2020 for Americans earning less than about $100,000 annually.

“If we can get a fair deal, we’ll do it this week, but the president needed to take action,” Treasury Secretary Steven Mnuchin said in a Monday interview on CNBC. “He’s not going to sit around.”

Mnuchin said that the signing of the controversial orders came after he and White House chief of staff Mark Meadows reported to Trump on Friday that talks with Democrats were at an impasse.

The Hill’s Naomi Jagoda has more here.

Other key points:

A top White House adviser said the deferred payroll taxes — opposed broadly by both parties on Capitol Hill — would give workers a wage increase.
Top Democrats slammed the orders as “weak and narrow,” and urged the White House to return to the negotiating table.
They also denied the president’s assertion that they had reached out to the White House to restart negotiations, with Senate Minority Leader Charles Schumer (D-N.Y.) calling Trump’s claims “fables.”

LEADING THE DAY

CBO says deficit hit record $2.8 trillion in 10 months: The deficit climbed to a record $2.8 trillion during the first 10 months of fiscal 2020, roughly doubling the biggest annual deficit, according to figures released Monday by the nonpartisan Congressional Budget Office (CBO).

“Revenues were 1 percent lower and outlays were 51 percent higher through July 2020 than during the same 10-month period in fiscal year 2019,” the CBO said in its monthly budget review.

The spending spike stems from coronavirus-relief efforts, which turned on a fire hose of federal funds to help rescue small businesses and airlines, in addition to providing enhanced unemployment insurance for millions of Americans who have lost their jobs during the recession.

The national debt has become a sticking point in negotiations over another COVID-19 rescue package, with Republicans raising the alarm about additional government spending.

Read more from yours truly here.

Federal government pauses Kodak loan pending probes: Shares of Eastman Kodak Co. plummeted Monday after a federal agency blocked a $765 million government loan to the company following the deal, which was touted by President Trump, coming under congressional scrutiny.

The U.S. International Development Finance Corporation said in a Friday tweet that “recent allegations of wrongdoing raise serious concerns. We will not proceed any further unless these allegations are cleared.”

The Securities and Exchange Commission is investigating the deal after being pressed by lawmakers, led by Sen. Elizabeth Warren (D-Mass.).

Kodak’s board said Friday it’s also opening a review.

Warren specifically asked Securities and Exchange Commission Chairman Jay Clayton to investigate “several instances of unusual trading activity” involving Kodak stock one day before the federal government announced it would lend $765 million to the company to produce pharmaceuticals in the U.S.

Nate Weixel has the details here.

EVENT

On Thursday, August 13, The Hill Virtually Live hosts a virtual event, Breaking Through: U.S. Businesses Powered By Global Exports. Global trade is messier today than years ago — a pandemic is creating unforeseen challenges, sanctions are back, and the WTO is wobbly. But global trade is still thriving in many sectors. While nations may be squabbling, businesses are finding ways to deliver their products to consumers. Rep. Rick Larsen, former Commerce Secretary Carlos Gutierrez and more join The Hill’s Steve Clemons. RSVP today: https://bit.ly/3kjRWZl

ON TAP FOR TOMORROW: