As the economy tanks, Republicans go home

Follow Us Get the newsletter Get Jonathan Bernstein's newsletter every morning in your inbox. Click here to subscribe. Majority Leader Mitch McConnell has sent the Senate home for the weekend. That means, even as dismal economic news keeps mounting, there won't be a last-minute deal to keep expanded unemployment insurance intact. It's been hard all along to figure out what the Republican plan might be, and it's getting harder. To be sure, quite a few Republicans — maybe 20 in the Senate, according to reports, and many more in the House — seem to be comfortable with no deal at all. They appear to think that additional spending will hurt, not help, the economy, whether it's aid to state and local governments (which the party is almost unified against) or additional benefits for the millions out of work. At least one Republican, Representative Roger Williams of Texas, apparently believes stimulus is irrelevant because, "with low interest, low taxes and cash in the system, the economy's pretty good." How that squares with the worst quarter since records began, along with signs that a tentative recovery has stalled, is a mystery. Others seem to understand that the virus-induced recession is real, but just don't think the government can do much about it. In particular, they're convinced that the reason for mass unemployment is expanded benefits, not the virus and a lengthening list of failed businesses.  That leaves McConnell, and the White House, in an extremely difficult bargaining position, made worse by their decision to wait until the last minute. Democrats are united behind their own proposal, which passed the House in May. McConnell can't put his bill on the Senate floor because it would be defeated — not by a Democratic filibuster, but because he doesn't even have a simple majority in favor of it.  Democrats do want a deal. But they also think that politically an impasse mainly hurts the Republicans. Of course, partisans will just blame the other party, and most others will blame "Washington" or "the government." But since Donald Trump is president, voters are likely to take such general anger out on the Republican Party. In fact, three factors are working against the party. Voters may in the abstract think the government is handling things badly. Those who are unemployed are certainly going to notice a $600 cut in the checks they've been getting, and will blame the party that is insisting those benefits should be smaller. And then there are the indirect effects, such as decreased consumer spending, that will be felt throughout the economy and that should also hurt Republicans. (See Jared Bernstein's helpful run-through of the economics involved.) The truth is that it should be relatively easy to find a compromise. If, that is, most Republicans accept mainstream economics and realize that they should pump serious money into the economy at the moment. And if they're willing to vote for a package that will invite criticism from those who claim to be True Conservatives. And if they're willing to risk being undercut by Trump after they produce the bill, just as he's done several times before.  Unfortunately — for the economy, for people in need and for Republicans in November — that might be two or three "ifs" too many.  1. Some final words from Representative John Lewis. 2. Michael McKoy at the Monkey Cage on Tom Cotton, Martin Luther King and patriotism. 3. Also at the Monkey Cage, Allison Carnegie and Austin Carson on Syrian chemical weapons. 4. Dave Hopkins misses regular campaigning. 5. Seth Masket at Mischiefs of Faction on the economy and the election. 6. Emily Badger and Nate Cohn on Trump and the suburbs. 7. Kevin Robillard on the Trump campaign's virus-free TV ads. 8. And Reid Wilson on governors starting to lose some of their pandemic-related popularity. Get Early Returns every morning in your inbox. Click here to subscribe. Also subscribe to Bloomberg All Access and get much, much more. You'll receive our unmatched global news coverage and two in-depth daily newsletters, the Bloomberg Open and the Bloomberg Close.    Before it's here, it's on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can't find anywhere else. Learn more.   You received this message because you are subscribed to Bloomberg's Early Returns newsletter. Unsubscribe | Bloomberg.com | Contact Us Bloomberg L.P. 731 Lexington, New York, NY, 10022