Trump Has Covid-19. What’s Next For Stimulus Package Negotiations?

Early Friday morning, President Trump announced he had tested positive for Covid-19, causing a collective gasp throughout the nation and much speculation about the potential effects on the American economy. 

The president’s physician, Sean Conley, released a memo confirming that both Trump and first lady Melania Trump contracted the virus and would be quarantining at the White House.

The news comes on the cusp of a turbulent presidential election in a nation shell-shocked by the pandemic and a shaky economy that has resulted from it. 

What might Trump’s diagnosis mean for the country—and the economy? 

How Trump’s Diagnosis Could Affect a Future Stimulus Package

Recommended For You

The president tested positive for the coronavirus just hours after the House passed the Democrats’ slimmed-down $2.2 trillion HEROES Act proposal

Although it appears that negotiations to finalize a second stimulus package continue to move forward in spite of the president’s positive test, passage by the House doesn’t guarantee that the Senate will consider the bill. The first version of the HEROES Act was passed by the House in May, but never made it to the Senate floor. 

Democrats, led by Speaker of the House Nancy Pelosi, have been in slow but steady negotiations with Treasury Secretary Steven Mnuchin to try and find middle ground between the HEROES Act and the Republican-led HEALS proposal. 

Prior to the passage of the HEROES Act on Thursday, the White House proffered a $1.6 trillion proposal that includes another round of stimulus checks, $300 billion to fund $400-per-week unemployment benefits for qualifying Americans until the end of the year, and $160 billion for the Paycheck Protection Program. However, the Democrats dismissed the package as being inadequate for meeting Americans’ needs. 

If Trump has Covid-19 symptoms, as news reports indicate—and at the very least, has to lay low while he’s in quarantine—it remains unclear how any progress can continue on a stimulus package. Even if he grants Mnuchin full authority to weigh in on the next steps for a stimulus package, at some point the President would have to review and sign the bill to formally make it a law.

“I expect the President to continue carrying out his duties without disruption while recovering,” Conley said in his memo. But if the President isn’t feeling well, it’s possible that the long-delayed next round of stimulus aid will be further postponed, leaving many dealing with continued financial strain.

According to the 25th Amendment to the United States Constitution, the Vice President could be called upon by the Cabinet to step in and do the President’s job, even temporarily, if they deem Trump too sick to perform the duties of his office.

How Trump’s Diagnosis Could Affect Payroll Taxes

The president’s developing health situation could delay answers about the fate of the payroll tax deferral he announced in August.

Trump announced four executive orders at a briefing on Aug. 8, including a payroll tax holiday where any employee who is paid less than $4,000 before taxes per biweekly pay period is eligible to defer their payroll taxes from Sept. 1 through Dec. 31, 2020. The plan has been met with resistance from lawmakers who say that deferring payroll taxes now creates an undue burden when it ends. 

The payroll tax holiday is not a mandate but an option, and notably, the U.S. House of Representatives declined to give the tax holiday to its employees as did several other large employers. But many federal government employees have seen the payroll tax deferral implemented, which could lead to a tax liability burden once the deferral period ends. 

Congress has the ability to vote on whether or not to forgive the deferred payroll taxes, according to the Government of Accountability Office, which said in a memo to Democrats that the payroll tax holiday order falls under the Congressional Review Act. That means the Senate could vote to overturn the order if at least 30 senators sign to request a vote. 

But President Trump, an ardent supporter of cutting payroll taxes, would likely veto a vote to overturn the order. However, any future movement on forgiveness of the deferred payroll taxes or a veto by Trump is now also likely to be delayed pending the President’s recovery. Pence has signaled his support for the payroll tax in interviews, making it likely that even if the vice president takes over on this issue, it will get vetoed.

What Does This Mean For Future Debates?

If Trump hasn’t fully recovered by the date of the next debate, Wed. Oct. 7, it’s unlikely that the candidates will have this opportunity to showcase and share their respective plans.  

Presidential debates provide an opportunity for Americans to learn more about the substance of the candidates’ economic policies, and in the case of Trump and his opponent Vice President Joseph Biden, how they would lead the country out of the Covid-19 recession. 

Even prior to the president’s positive Covid test, questions were swirling about the future of the two remaining presidential debates. When the evening quickly devolved from a discussion of pressing issues like the economy and Covid relief into a shouting match of interruptions and personal jabs, some questioned the value in holding additional debates.

MORE FROM FORBESTuesday’s Presidential Debate: Did We Learn Anything About The Economy?

The evening proved so chaotic that the Commission on Presidential Debates announced that they would make significant changes to the format moving forward, although they have not specified what those changes are yet. 

it’s unclear how Trump would prepare for and speak at a debate, regardless of any new formats or safety protocols, if he’s still experiencing symptoms of the coronavirus.

CNN reported the Trump campaign did not alert the Biden campaign to possible exposure after this week’s debate.