President Trump said Monday his administration would discuss a possible payroll tax cut with the U.S. Senate, saying they would seek “very substantial relief” for the economy, which has been roiled by the outbreak of the novel coronavirus.
Trump, speaking at a White House news conference, added that his administration plans to speak with lawmakers on Tuesday, seeking the aid to help hourly wage earners “so they don’t get penalized for something that’s not their fault.”
Trump said he plans to announce “very dramatic” actions to support the economy at a news conference Tuesday after discussions with lawmakers.
“I will be here tomorrow afternoon to let you know about some of the economic steps, which will be major,” Trump said.
Pressure has been growing on Trump to take more decisive action in response to the coronavirus, as the number of cases in the U.S. and worldwide continues to grow. U.S. stocks plunged more than 7.5% on Monday — the worst day on Wall Street since the financial crisis, as a full-blown oil price war rattled financial markets already on edge over the outbreak.
Trump’s statement marks a reversal from his administration’s recent position on the need for economic stimulus.
Last week, Treasury Secretary Steven Mnuchin said the administration isn’t considering a payroll tax cut as part of its response to the coronavirus. He added that the virus sell-off isn’t comparable to the financial crisis a decade ago. “We will get through this,” he told reporters on March 3. Market swings are happening because “the markets struggle to assess new risks.”
Republicans in Congress have begun floating their own ideas but had been waiting to hear from Trump before making specific proposals.
The idea of cutting payroll taxes has been gaining traction in Congress among some GOP lawmakers. But it’s drawn objections from Democrats, including Rep. Richard E. Neal (D-Mass.), chairman of the tax-writing Ways and Means Committee.
“There are other things we can do that have more immediacy,” Neal said.
Democrats and some Republicans also have endorsed taking some action to protect workers who don’t have any or enough paid sick leave to be able to self-quarantine for 14 days as health officials recommend. More than a quarter of private U.S. workers don’t get any sick leave with their jobs, including more than half of part-time workers and about 40% of service employees. About one-third of private U.S. workers don’t get medical benefits via their employment, according to government data.
House Speaker Nancy Pelosi and Senate Democratic leader Charles E. Schumer are calling for expanded paid sick leave, enhanced unemployment insurance for those laid off because of the virus crisis, expansion of food stamps and school lunches, anti-price gouging protections and free virus testing. They also want the government to reimburse virus treatment costs not covered by insurance. The exact details as to how those goals are to be achieved have yet to be worked out.
Trump on Monday added that the administration is working with the travel and hospitality industries to contain the spread.
“We want people to travel to certain locations and not to other locations at this moment,” Trump said, without elaborating.
Vice President Mike Pence, whom Trump tapped to lead the administration’s response to the outbreak, reiterated the position that “the risk of contracting the coronavirus to the American public remains low, and the risk of serious disease among American people remains low.”
Pence said that 21 people who had been aboard the Grand Princess cruise ship that docked Monday in Oakland are in proper isolation. He said officials hoped to disembark California residents by the end of the day. Other passengers will be sent to U.S. Air Force bases in Texas and Georgia, he said.