Stephen Moore claims July jobs report gives Trump leverage to order payroll tax holiday
President can argue 'Phase 4' stimulus bill not needed, economist says
The July jobs report gives President Trump the leverage to move forward with an executive order instituting a payroll tax holiday, FreedomWorks economist Stephen Moore told Fox Business Network's "Mornings With Maria" Friday.
"This report sets up very well for Donald Trump in these negotiations with [House Speaker] Nancy Pelosi," Moore told host Maria Bartiromo. "He can move forward with the payroll tax cut, which helps every working American."
MNUCHIN REJECTS $2T CORONAVIRUS STIMULUS OFFER FROM DEMOCRATS
The White House and congressional Democrats have been at a week-long impasse over the terms of a so-called "Phase 4" coronavirus bill. Democrats, led by Pelosi and Senate Minority Leader Charles Schumer, D-N.Y., have balked at Republicans' offer of a 'clean' one-week extension of the expanded $600 federal unemployment benefit, which expired July 31.
Democrats have also opposed GOP calls to reduce the unemployment amount in the next batch of legislation, arguing the $600/week payments to lower that amount slightly to offset the disincentive to work it creates in the hospitality and manufacturing sectors.
Moore and fellow economist Phil Kerpen explained in The Wall Street Journal last week that Treasury Secretary Steve Mnuchin has the power, enunciated in Section 7508A of the U.S. Tax Code, to postpone the IRS' "performing [of] certain acts ... for a taxpayer determined by [Mnuchin] to be affected by a federally declared disaster."
MOORE, KERPEN EXPLAIN HOW TRUMP CAN ENACT PAYROLL TAX CUT WITHOUT CONGRESS
An example of this, they noted, was the IRS' decision to delay this year's Tax Day to July 15 from the usual date of April 15.
Moore told Bartiromo that if Trump orders the IRS to stop collecting the payroll tax, workers would receive an instant 7.5 percent pay raise.
"I do think that Trump is going to say to Pelosi 'We don't need this massive stimulus bill, the economy's coming back pretty well on its own'," he said.
Moore added that the jobs report figures throw some cold water on the contention by governors that their states need hundreds of billions of dollars from the federal government to offset budget gaps created by pandemic-induced shutdowns.
He cited Bartiromo's report that 300,000 new government jobs were created in July, arguing that since government is the fastest-growing sector of the economy, it doesn't need the requested bailout.
