WASHINGTON – Just as Republicans were rediscovering their fixation with the national debt in the wake of President-elect Joe Biden’s victory, President Donald Trump scrambled the political calculus by calling on the government to write $2,000 checks to more than 150 million Americans.
The result has been a rapidly shifting realignment in Republican ideology. GOP officials just last week grudgingly signed off on $600 stimulus checks, tailored to meet their demand to keep the cost of a massive pandemic relief package under $1 trillion. Now, many have rushed to support the larger checks, which would add hundreds of billions of dollars to the nation’s credit card.
At the center of the shift is Trump, who has spent four years ignoring the national debt as it ballooned by nearly 50%, growing to $21.4 trillion on his watch. Trump’s desire to leverage additional government largesse for political benefit is now competing with the desire of GOP leaders to start reining in federal spending and reestablishing their party’s small-government orthodoxy before Democrats return to the White House.
That tension played out on the Senate floor this week, as a growing number of Republicans signed on to Trump’s effort to back the $2,000 checks. But on Wednesday, Senate Majority Leader Mitch McConnell, R-Ky., pushed back, arguing against a fresh “fire hose of borrowed money” and asserting that legislation to quickly approve the payments was unlikely to pass the Senate.
“We just approved almost $1 trillion in aid a few days ago,” he said. “It struck a balance between broad support for all kinds of households and a lot more targeted relief for those who need help the most.”
Trump has cast the $2,000 checks – which could bear his name and reach Americans’ bank accounts shortly before he leaves office – as the smart thing to do politically and prudent public policy, given the shaky economy. He has made no mention of the national debt he once promised to eliminate in eight years.
On Wednesday, Trump, who has not publicly endorsed McConnell’s gambit, appeared to be growing impatient. “$2,000 ASAP!” he tweeted – following up on a Tuesday tweet in which he declared: “$600 IS NOT ENOUGH!”
Some Republican lawmakers – including those who may be eyeing higher office – have expressed support for the $2,000 checks. Sen. Marco Rubio (R-Fla.) sought to explain his newfound support in a way that also acknowledged his party’s previous antipathy toward deficits.
“I share many of my colleagues’ concern about the long-term effects of additional spending, but we cannot ignore the fact that millions of working class families across the nation are still in dire need of relief,” Rubio said in a statement Monday. “Congress should quickly pass legislation to increase direct payments to Americans to $2,000.”
Sen. Lindsey Graham, R-S.C., who earlier this year objected to a $600-a-week unemployment benefit, also came out strongly in favor of the $2,000 checks after Trump called for the larger amount. Graham, who is slated to be the top Republican on the Senate Budget Committee next year, had joined his colleagues in talking more openly since Biden’s win about the need to get government spending under control.
With interest rates low and economic devastation settling in throughout much of the country, economists say this is an especially bad time to focus on the worrying growth of the national debt. Instead, policymakers should focus on boosting the economy with more government spending, said Mark Zandi, chief economist with Moody’s Analytics.
“It ensures that the economy will navigate to the other side of the pandemic without going backward,” Zandi said. Zandi said increasing the relief checks to $2,000 is “the right economic policy,”though some economists support the view that relief targeted to families who have lost work or suffered some other economic harm would be more cost-effective.
Zandi added that the politics of spending and deficits are morphing in a way that could make large federal payments to individual Americans look like a good political move.
Sens. Kelly Loeffler and David Perdue, two Republicans facing a critical runoff election in Georgia next week, have voiced enthusiastic support for the larger checks despite their history of touting small government. After months of branding their Democratic opponents as “socialists,” Loeffler and Perdue now find themselves in agreement with challengers Raphael Warnock and Jon Ossoff in supporting new massive government spending.
Democrats have seized on the fissure emerging between Trump and many Republican lawmakers, gleefully pushing for votes that highlight the GOP disunity. Some have called out Republicans for increasing the deficit early in Trump’s presidency by passing tax cuts.
After the House passed a bill late Monday approving the $2,000 checks with the support of 44 Republican lawmakers, Senate Minority Leader Charles Schumer, D-N.Y., demanded that McConnell bring the measure to a vote on the Senate floor.
“I don’t want to hear that we can’t afford it. I don’t want to hear that it would add too much to the deficit,” Schumer said. “Senate Republicans added nearly $2 trillion to the deficit to give corporations a massive tax cut.”
For his part, Trump has tried to publicly pressure Republicans and privately win them over in a final attempt to sign significant legislation before leaving office. After holding up the larger, bipartisan pandemic relief package for days – in part because it authorized checks to individual Americans of only $600 – Trump won a vague promise that the Senate would vote on the $2,000 checks.
During a round of golf with Graham in Florida on Christmas Day, Trump made clear that he was serious about the need for bigger checks – and that he was willing to torpedo the pandemic relief package and an attached budget bill, shutting down the government if Congress refused to oblige. Soon after, Graham began expressing support for the higher payout, calling Trump’s demand “reasonable.”
In addition to Graham, Rubio, Loeffler and Perdue, Sen. Deb Fischer, R-Neb., has indicated she would vote for the $2,000 payments. Sen. Josh Hawley, R-Mo., has long been a champion of checks for individual Americans of up to $2,000.
But many Republicans remain unconvinced, and Trump’s political power is ebbing as his Jan. 20 departure from the White House nears. Republicans including Sen. John Cornyn of Texas, who is close to McConnell, and Rep. Kevin Brady of Texas, the senior Republican on the House Ways and Means Committee, have specifically cited the deficit in opposing the additional spending.
On Tuesday, McConnell openly defied the president by blocking consideration of the House-passed bill to authorize the $2,000 checks. And on Wednesday, he announced that he would permit the Senate to vote on a measure that combines the $2,000 checks with two other Trump demands: repeal of liability protections for technology companies and creation of a new commission to study election fraud.
Many Democrats oppose those provisions. So Senate Republicans could vote for the $2,000 checks knowing the package could not pass the Democrat-controlled House – which, in any case, has left town for the year.
Increasing the checks from $600 to $2,000 would add about $464 billion to the $900 billion stimulus package Congress passed last week. For Republicans looking ahead to a Biden administration in which expanding the size and role of government is likely to be a top priority, the additional spending is a bridge too far, said Doug Heye, a GOP strategist and former spokesman for the Republican National Committee.
Some Republicans are looking ahead not only to Biden’s presidency, but to their own future runs for the White House, Heye said. Separating from Trump on the issue may help carve out some political space to reclaim the mantle of fiscal conservatism.
“It allows candidates who are running to find a way to differentiate themselves from each other,” he said, “and potentially show where they have – while not being critical of Trump personally – demonstrated their . . . independence from everything that Trump did.”
Just a few years ago, the national debt was an obsession for the Republican Party, which repeatedly shut down the government and pushed the nation to the brink of default in a campaign to force President Barack Obama to rein in federal spending. During Obama’s 2012 reelection campaign, the Republican National Convention featured a running clock that tracked the debt’s rapid ascent.
When Obama left office, publicly held debt stood at $14.4 trillion. Since then, Trump has cut taxes, increased federal spending and presided over a pandemic-induced economic collapse that together have added an additional $7 trillion to the tide of red ink. In October, the national debt was larger than the entire U.S. economy for the first time since the aftermath of World War II.
The president has long pushed to spend more money, often seeking to personalize the government’s outlays to Americans. He has signed letters to be included in food boxes for the poor, pushed to send pre-election drug discount cards worth $200 to senior citizens and affixed his name to the first round of $1,200 stimulus checks sent out earlier this year.
With Republican leaders standing in the way of his latest bid for more spending, Trump has gone on the attack. “WE NEED NEW & ENERGETIC REPUBLICAN LEADERSHIP,” he wrote on Twitter, where he also claimed that he was responsible for Republicans’ electoral successes in the House and Senate this year.
Whatever happens with the $2,000 checks, Zandi predictsthat Republicans will continue to refashion themselves as deficit hawks when Biden takes office.
“As soon as the pandemic is over and Biden is president and the election process is in the history books, then deficits and debt will come to the fore again as an issue,” Zandi said. “And it will become a real binding constraint on the ability of the [Biden] administration to get economic policy done legislatively” – just as it was for Obama.