“Love was (not) changing the minds of pretenders?” Treasury Secretary Steven Mnuchin called Speaker Pelosi to talk, but the two have not yet ended the stalemate between the White House and Democrats. Both sides blame each other. The next jobs report will not come out until September, and the Republican and Democratic conventions will take up most of the rest of August, leaving little reason to reach a deal before then.
“While chasing the clouds away.” Bloomberg News reports that the likely Democratic ticket of Joe Biden and Kamala Harris is getting economic briefings from former Fed Chair Janet Yellen, former Biden vice-presidential aide Jared Bernstein, Harvard’s Raj Chetty, Michigan State’s Lisa Cook, and former Hillary Clinton advisers Heather Boushey and Jake Sullivan. Bernstein and Boushey have long been identified with the campaign, along with economic advisers Ben Harris and Austan Goolsbee.
“Our hearts were ringing in the key that our souls were singing…” The Wall Street Journal reports (paywall) on the continued confusion of employers about President Trump’s executive action to defer collection of the payroll tax. The US Chamber of Commerce has urged Treasury Secretary Mnuchin to address significant questions about implementing the deferral.
“As we danced in the night…” The American Institute of CPAs has asked Treasury to allow individual workers to opt-out of President Trump’s payroll tax deferral plan. Trump has issued an executive action that allows firms to defer collecting and remitting the Social Security tax from Sept. 1 through the end of the year. The AICPA wants workers to have the choice to have their tax withheld even if their employers adopt deferral. One payroll tax lawyer said such a system would be “a mess.”
“Remember how the stars stole the night away?” TPC’s Elaine Maag recalls that before the pandemic, Senator Kamala Harris introduced the LIFT (Livable Incomes for Families Today) the Middle Class Act. The measure from Biden’s newly-named Vice Presidential choice, is a greatly enhanced form of earned income tax credit. It may be the most generous tax credit aimed at supporting work and families among several proposed recently. Elaine concludes that while it’s unclear whether it will become “part of Biden’s own tax plan … it does demonstrate Harris’s longstanding commitment to increasing the incomes of low- and middle-income workers.”
Members of each chamber of Congress will be in their home districts until Congress and the White House reach a deal on coronavirus relief. Barring such a deal, the Daily Deduction will post Mondays only until… September.
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