These factors could exacerbate an extreme slowdown in the tourism, restaurant and hotel industries and further undermine the oil industry, which is already suffering from low prices.
Millions of Americans are also at risk of power and water cuts with unpaid utility bills due, while protections for tenants, student borrowers and unemployed Americans will expires later this year if no federal action is taken.
Faint economic pressure comes amid the broken Capitol Hill bipartisan stimulus talks and talks between House Speaker Nancy Pelosi (D-Calif.) And Treasury Secretary Steven Mnuchin. Pelosi and Mnuchin, who have been working together throughout the year to successfully secure trillions of dong in emergency aid, have instead traded silly in recent days, with Pelosi saying Tuesday the administration had “failed miserably”; and Mnuchin attacked Pelosi’s “ALL OR NO approach” in a letter on Friday.
President Trump and Pelosi both said they would pursue an economic bailout deal during Congress’s session, but the compromise proved elusive.
Michael Strain, an economist at the American Enterprise Institute, a right-wing think tank, said: “All the signs are we are facing the worst and the situation in Washington is also. is getting worse and worst. .
Washington’s political conflict has escalated amid rising coronavirus infections and the shocking global economy. Wall Street was reeling last week, with the Dow Jones industrial average and the S&P 500 seeing the biggest weekly drops since March. They recovered part of those losses on Monday.
With the cold weather expected to limit outdoor dining, 40% of restaurant owners nationwide said they expected to stop trading in March without further government support. , according to industry surveys.
Tourism has yet to recover even half of its business, according to the Transport Security Administration. On Wednesday, about 700,000 people cleaned up the agency’s checkpoints, compared with about 2 million a year earlier. Nearly 4 million jobs in the tourism industry have been lost in the pandemic, and another 1 million could have disappeared by the end of the year without federal intervention.
The largest hotel group in the hotel industry said in September that two out of three US hotels will not be available for another six months.
The major airlines announced tens of thousands of planes later this year after their federal aid programs expired in September.
Democrats and Republicans in Congress have grown further apart in recent weeks, with some Republicans raising concerns about government spending and Democrats demanding more action. They may face major decisions during a session of Congress.
Federal emergency weekly unemployment benefits have been cut for months. Several million people will start running out of basic unemployment benefits starting in mid-December. Absent action, a separate federal unemployment program for about 10 million contract workers and others who are not eligible. Get traditional unemployment insurance that expires on December 31.
The week after the election, the Supreme Court will pass the Affordable Care Act, which could cause tens of millions of people to lose health insurance.
Amid all this, lawmakers must also reach an agreement by December 11 to prevent the federal government shutdown.
The rise in coronavirus infections has led cities and states across the country to impose new coronavirus restriction measures with increased hospitalizations and deaths. Anthony S. Fauci, director of the National Institute of Allergy and Infectious Diseases, recently told The Washington Post that “we are suffering a lot” and that the United States “could not be in a worse position.” to handle viruses in the fall and winter.
Among the biggest mysteries about this uncertainty is what Trump and his aides will do after Election Day, especially if he loses Democratic candidate Joe Biden. There are almost three months left between the November 3 election and the next inauguration on January 20 – a period when both public health experts and economists are concerned that the corona virus will strike. nation with new ferocity. As colder weather pushed people into the house, the Trump administration failed to devise plans for how to deal with the expected rise of illnesses and hospitalizations.
Trump and Pelosi have repeatedly debated important policy issues. In his letter on Thursday, Pelosi said Democrats and governments are still divided over liability protection for businesses, money to state and local governments, tax credits for children. , among other problems. Last week Trump attacked Pelosi for not being interested in a deal and White House officials have repeatedly criticized Pelosi for pushing $ 1,200 stimulus checks to undocumented immigrants and “bundles bailout for states and cities, terms Republicans say they are not ready to accept.
The president’s attitude toward the stimulus package has fluctuated wildly in the past few months and could change again after the election. Several former White House officials and many Republican aides on Capitol Hill said they believe the president may lose interest in the economic stimulus package once it does not benefit the presidential campaign. His 2020.
“I don’t think he cares much about stimulus,” said Casey Mulligan, who was once chief economist of the White House’s Council of Economic Advisers. “He doesn’t like giving anything for free, and I don’t think he’s going to start now. That is not his style ”.
When the first wave of coronavirus cases occurred, lawmakers quickly rallied on a bipartisan basis to approve trillions of dong in emergency federal aid – most of which was aimed at businesses. business and family have difficulty.
However, that aid is temporary and much of it has already arrived. Of the $ 2.7 trillion a pandemic aid approved by Congress this year is expected, according to Marc Goldwein, vice president of the Responsible Federal Budget Committee, a non-partisan advisory organization. There will be costs, $ 2.4 trillion – or 90% – already disbursed or committed. monitor the response of a pandemic.
Now, even as coronavirus infections begin to soar, the United States is facing policy deadlines and economic pressure points amid an increasingly bleak political situation, one of the few. which experts warn may take weeks before election results clear.
The Trump administration unilaterally renewed the deportation ban for tenants, but it will end later this year. According to non-profit housing groups, tenants will still have to pay for the months they don’t pay, creating a backlog that could put 30 million to 40 million Americans nationwide at risk. eviction when the ban expires, according to nonprofit housing groups. Hunger also increased significantly. The proportion of adults reporting that their families do not have enough food to eat has increased significantly from last year, according to data from the Center for Budget Priority and Policy, a left-wing think tank, total well suited.
Other parts of the US economy are facing problems. The New York City Regional Urban Transport Authority warned in October that as many as 8,000 employees were laid off. Last month, Amtrak warned of layoffs of 2,400 employees without federal assistance. Of the 100,000 workers in the private bus industry, 80,000 were laid off and 30,000 of them could lose their jobs, according to Peter Pantuso, president and chief executive officer of the American Bus Association. without federal assistance in the coming months. , an industry group. As much as 30% of bus operators face bankruptcy on January 1, Pantuso said.
Boeing, the aerospace giant, announced more than 7,000 employees were laid off last week. More than a dozen major retailers filed for bankruptcy during the pandemic, and analysts say many more could happen if they can’t sustain sales during the crucial holiday season. , especially if forced to close during the Christmas shopping season. The pandemic has cost the oil and gas industry more than 100,000 jobs, with ExxonMobil announcing an additional 1,900 job cuts in the US last week as oil prices continue to decline. Jobs this September fell more than 40% in the film, art and entertainment industries, numbers that could have been even worse without federal help in winter.
Many economists still say that the US economy as a whole will continue to recover even if there are deep scars in certain sectors during winter.
The unemployment rate has fallen to 7.9% from its peak in the spring. The federal government reported a record 7.4% increase in gross domestic product in the third quarter as the US economy recovered partly from pandemic lows, partly driven by the stimulus of federal. White House senior economic adviser Larry Kudlow has supported a stimulus deal but said the economy is on track to recover “self-sustaining” without additional federal support.
“I don’t think the biggest risks are pervasive or national. The biggest risk is the specific geographic area and specific demographic segments, ”said Ernie Tedeschi, who was an economist in the Obama administration. “But the pain for those segments can be profound.”
Last week, Trump has repeatedly said that he will pursue a massive stimulus package after the election. He says he will do so after Republicans retake the House of Representatives in Tuesday’s elections, a scenario most political strategists consider extremely unlikely. “After the election, we’ll get the best stimulus you’ll ever see,” said the president.
White House spokesman Brian R. Morgenstern said in a statement that Trump “remains committed” to a stimulating deal, but reiterated the administration’s opposition to Democrats “efforts to exploit the virus. to fund the “free wish list”, including the provision of billions of dollars to the state and local governments.
Pelosi and Senate Majority Leader Mitch McConnell (R-Ky.) May face their own political incentives to delay emergency relief. If Democrats hold the House and retake the Senate, they may want to wait for the next Congress to pass another bailout bill since then they won’t have to compromise with Republicans. And McConnell’s conference was wary of spending trillions more on the economy, with conservative senators faltering at rising national debt – pressure could escalate if Republicans aim to avoid supporting an upcoming Democratic administration.
John Lettieri, president and CEO of the Economic Innovation Group, said: “If it is difficult now, before the election, for Senate Republicans to reach a clause with the White House – the Consensus is almost impossible after the election ”is lobbying lawmakers to bail out small businesses. “The cost will be huge. It will be a self-inflicting wound on an already unstable economy.
Abha Bhattarai and Andrew Van Dam contributed to this report.