Government shutdown looms as Trump demands stimulus bill changes
Yahoo Finance’s Rick Newman breaks down why Trump’s attack on a stimulus deal could lead to a lapse in unemployment aid.
Video Transcript
- First, though, let's talk about that big aid package and what is going to happen next. We bring in our Rick Newman for that. Rick, we talked a little bit about this yesterday. And-- hey, Merry Christmas. How in the mood are you? [CHUCKLES]
It doesn't seem like much has really moved. I mean, the Democrats are more than willing to boost those stimulus checks, but it doesn't seem like there's broad agreement beyond that. So are we just in a stall for the foreseeable future?
RICK NEWMAN: It depends what Trump is going to do. He basically reasserted himself, said, look I'm still here. I'm still president.
So now we're waiting to find out with regard to this relief bill and the government spending bill, he-- Trump never said he was going to veto it. He just said he wanted bigger stimulus checks, and he had some other objections.
So the big question is, is Trump going to sign this bill, or is he not going to sign this bill? And we need to point out that ordinarily if the president does not sign a bill, it becomes law. But in this instance, because Congress is adjourning, if Trump does not sign the bill, it dies.
So-- [LAUGHS] so Trump is keeping everybody in suspense, which I think is exactly what he wants. And Washington now spins around Trump. He's the axis around all of this chaos at the moment. So we will wait to see what he's going to do.
- Rick, why isn't it a $2,000 check? Why isn't that an easy sell with Republicans and Democrats? Why is it giving struggling households more money a good thing?
RICK NEWMAN: Because the whole relief bill is like a giant Jenga stack. And if you pull out one single measure, then a bunch of other things just come out, and the whole thing collapses. So believe it or not, there are some Republicans who are concerned, again, after a while, about rising federal deficits and the national debt.
And they say this is just too expensive. And by the way, another thing going on here is economists say if you want to add more relief for Americans to this bill, the better way to do it is through bigger unemployment benefits, because that would actually go to the people who have lost their jobs and are hurting more.
Whereas, the stimulus checks just go to everybody who earns less than, I think, the threshold is $90,000. And some of those people are working and doing OK. So you can't just take one thing out of a bill that-- or add one thing to a bill that took eight months to negotiate and expect the whole rest of the bill to remain intact. Everything is connected to everything else.
- And not only that, Rick. But the aid bill is attached to the omnibus bill, the spending-- the government spending bill, a budget bill effectively for the US government. So [AUDIO OUT] weak economy and with people not getting their checks, their aid expiring, we could also end up with the government shutting down, right?
RICK NEWMAN: Yeah. You know, the world may cease to exist by next week, [LAUGHS] in Washington terms. So the first thing that happens is on Saturday, the unemployment aid that was in prior bills, that ends. And then on Monday, if this doesn't get-- if Trump doesn't sign this bill, the government will have to shut down for lack of funding.
And oh, by the way, Trump also vetoed the defense spending bill. So Congress is going to come back to Washington next week and see if they can override that veto, which would be the first veto of Trump's-- first override, rather, of Trump's presidency. So it is not going to be a quiet holiday period.
- Yeah. Definitely not. All right, thanks to our favorite Christmas elf, Rick Newman, for joining us today.
RICK NEWMAN: Bye, guys.
