U.S. economy rebounding strongly; fresh aid coming to unemployed

The U.S. economy is rebounding “very, very strongly,” and fresh federal aid will reach unemployed Americans in the next week or two, White House economic adviser Larry Kudlow said on Wednesday, shaking off concerns about a second wave of COVID-19 infections.

Kudlow, speaking to reporters at the White House, defended a reduction in the unemployment supplement to $300 from $600, saying stimulus measures should be reduced slowly as the economy strengthens.

“I think the economy is on a self-sustaining recovery and it’s a V-shaped recovery,” he said. “We’re seeing terrific numbers.”

Asked about concerns that a second wave of coronavirus infections this autumn and winter could derail the recovery, Kudlow said: “The hope is that the decline in cases and fatalities will continue. That’s the great hope.”

He said the number of infections should continue to decline since more Americans were now using face masks, maintaining social distancing and regularly washing their hands.

The U.S. Centers for Disease Control and Prevention (CDC) on Wednesday reported 5,460,429 cases of the novel coronavirus in the country, an increase of 39,318 from its previous count, and said the number of deaths had risen by 1,172 to 171,012.

Kudlow said the White House was looking at different ways to ensure that the payroll tax cut called for by President Donald Trump would be forgiven.

“As far as the payback is concerned, … you could stretch that out over a long period of time,” Kudlow told reporters. “So the payback won’t be immediate and no one will be hurt.”

He said the payback could occur over five to eight years since the budget window was 10 years. The amount in question was roughly $1,100 per worker for four months, he said.

U.S. House of Representatives Democrats on Wednesday unveiled legislation that would require same-day processing for mail-in ballots and give the cash-strapped Postal Service a $25 billion infusion while erasing changes pursued by the agency’s new leader, an ally of Republican President Donald Trump.

The Democratic-led House is scheduled to vote on the legislation on Saturday, though there is little chance for passage in the Republican-led Senate. The bill would prevent the Postal Service from implementing policies to alter service levels that were in effect at the beginning of this year.

Democrats and Republicans engaged in a war of words over the legislation and the management of the Postal Service.

Democrats and other critics have accused Trump of trying to impair the Postal Service to suppress mail-in voting as he trails Democratic challenger Joe Biden in opinion polls ahead of the Nov. 3 election.

Ninety House Democrats urged the removal of Postmaster General Louis DeJoy, saying in a letter to the U.S. Postal Service Board of Governors that he had used his stewardship to “sabotage” the agency.

“DeJoy has implemented policies that have slowed delivery times to unacceptable levels and resulted in undelivered mail,” the Democrats wrote.

Meanwhile, House Republican leaders urged their rank-and-file to vote against a bill they have dubbed the “USPS Conspiracy Theory Act.”

Republican Representative James Comer said DeJoy was “taking prudent steps to improve an unsustainable (USPS) business model.”

White House Press Secretary Kayleigh McEnany said the Postal Service has enough cash on hand, including a $10 billion line of credit approved by Congress earlier this year. McEnany also said the White House is open to supporting $25 billion in funding for the U.S. Postal Service but wants aid for Americans unemployed because of the coronavirus pandemic included.

Congressional Democrats, Republican lawmakers and the White House have been at an impasse in talks over the latest pandemic relief legislation.

Under intense criticism, DeJoy announced on Tuesday that he would put on hold until after the election cost-cutting moves at the Postal Service that Democratic lawmakers and state attorneys general argued could imperil mail-in voting. DeJoy said he suspended all “operational initiatives” through Election Day to “avoid even the appearance of any impact on election mail.”

DeJoy, who has been a major political donor to Trump, assumed the job in June.

House Speaker Nancy Pelosi said in a statement released after she spoke with DeJoy that the suspension “is wholly insufficient and does not reverse damage already wreaked.”

Pelosi said DeJoy “admitted that he had no intention of replacing the sorting machines, blue mailboxes and other key mail infrastructure that have been removed and that plans for adequate overtime, which is critical for the timely delivery of mail, are not in the works.”

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