Alan Rappeport, Jeanna Smialek, Ana Swanson and Jim Tankersley
11/10/2020 3:42 PM
Clarín.com
The New York Times International Weekly
Updated 11/10/2020 3:42 PM
WASHINGTON - President-elect Joe Biden will take office in January with
an economy burdened and burdened
by the coronavirus resurgence, millions of Americans still unemployed, and troubled businesses closing as winter approaches.
Meeting that economic challenge and keeping his campaign promises on taxes and spending could be tricky if Republicans keep control of the Senate.
However, as President Donald Trump demonstrated time and again, Biden has the power to operate some levers unilaterally, without congressional approval, and
could influence the economic policymaking
of the federal government through a series of executive actions, regulations and personnel changes.
"
You can do a lot without Congress,
" said Felicia Wong, an adviser to Biden's transition council, but who spoke as director of the Roosevelt Institute, a progressive research center.
From finding ways to stimulate the economy to changing business rules to modifying corporate taxes, here are some of the ways the Biden presidency could unilaterally influence economic policy.
Stimulus
In the run-up to the election, Trump saw the lengths of the White House's ability to jump-start the economy without Congress.
He reallocated some federal funds
to temporarily extend expanded unemployment insurance and allowed companies to defer collecting payroll taxes from workers, but he couldn't do much more.
Economists and political advisers say
Biden has a chance to pursue other creative strategies
if a Republican Senate blocks the kind of significant spending package that Democrats have been pushing.
That includes student debt relief, which Wong says would work as a kind of stimulus by removing the burden of those payments.
Biden could order the Secretary of Education to forgive student loans up to a certain amount;
Wong would forgive $ 50,000 to $ 75,000 to low- and moderate-income households.
That measure, he said, would greatly benefit racial and ethnic minority workers.
The government could also use executive authority to raise the
minimum wage for federal contractors to $ 15 an hour
, he said, which would mean a pay raise for thousands of workers.
Biden will be able to exercise some additional oversight over the
$ 2.2 trillion stimulus package
that was approved in March.
For example, small businesses that applied for loans from the Paycheck Protection Program were required to keep workers on their payroll.
You could ask your Treasury Department to take a closer look at the loans to make sure the money actually went to pay salaries and overhead.
Biden could also follow Trump's lead and try to reallocate the unspent funds from that stimulus legislation, including the hundreds of billions of dollars that went to the Paycheck Protection Program but were never allocated before. a deadline imposed by Congress would end the program.
It
could
also
rely on the Treasury
to make the loan facilities established by the Federal Reserve more generous and attractive to users, if they have not expired by the time Biden takes office.
Taxes
Biden proposed in his campaign trillion-dollar tax increases for top earners and companies.
Much of that agenda would require the cooperation of Congress, but in a few areas, the Biden administration could act on its own to increase taxes, primarily by changing the regulations governing the application of the tax law that Trump enacted in 2017 and that
became his hallmark.
Several of these regulations are applicable to income earned abroad by multinational companies operating in the United States.
Biden's Treasury Department could act to reverse a series of decisions that Trump's team made after the 2017 law was passed that
reduced the liability of multinationals
under a pair of new taxes created by the law, known as Base Erosion and Anti-Abuse Tax (known as “BEAT”) and Global Low Intangible Tax Income (GILTI).
Biden campaigned on the promise of increasing US tax obligations on the global revenues of multinationals, which he could try to do through regulations by changing the way the liability is calculated.
Your Treasury Department could also try to
reduce the so-called high tax exemption
, which allowed some businesses to reduce their taxes in the United States.
Biden's Treasury Department could also change the regulations regarding “opportunity zones,” another creation of the 2017 law that aims to attract investment in high-poverty areas by granting tax breaks.
Those changes may make it difficult for investors to
qualify for the
tax benefits of the zones, and the Treasury Department could
impose stricter reporting requirements
on projects that qualify for exemptions.
Commerce
As Trump has shown,
the executive branch has a lot of latitude
when it comes to trade policy.
Biden will face several short-term business decisions, including whether
or not to continue Trump's ban on TikTok and WeChat
, the popular social media apps, as well as whether or not to maintain U.S. tariffs on Chinese goods and foreign metals.
Biden would not need congressional approval to deal with these and other pending trade issues, including how to resolve a dispute with the European Union over subsidies to Boeing and Airbus, how to resolve global negotiations on digital services taxes, and whether whether or not to go ahead with
Trump's plans to impose new tariffs on Vietnam
.
Congressional approval would be needed if Biden wanted to pass any free trade agreements.
However, their advisers have said they are unlikely to seek new deals in the short term as they will choose to focus on national priorities.
Some of Biden's other trade priorities cross partisan lines and could win support among Republicans in Congress.
These include things like tightening the rules for buying American-made products to put more dollars into American products, or investing in domestic technologies like semiconductors to
ensure that China does not gain a competitive advantage.
.
Financial regulation
Some of the biggest Trump-era changes in banking regulation were made through regulators and not through Congress.
Examples include the weakening of the Volcker Rule, which prevents banks from betting on their own profit, and the revision of the Community Reinvestment Act (CRA), which
obliges banks to invest in poor communities.
A new team of regulatory officials will have leeway to either reverse those adjustments or impose new ones, which will likely result in increased vigilance.
Like the gradual deregulation during the Trump administration, any changes stemming from the Federal Reserve and its affiliated regulatory agencies are likely to be small and constant.
"
Democrats will have to work hard on the legislative front,
" said Ian Katz, director and financial policy analyst at Capital Alpha Partners.
"The actions will fall mainly with the regulators."
However,
the changes may not come as quickly
, even if Biden summons more pro-regulation officials to the various agencies.
Randal Quarles, who was appointed by Trump and will remain in office until 2021, serves as the Federal Reserve vice chair for oversight.
Consumer protection
The Biden administration could wield enormous influence over consumer protections, including those related to debt collection, payday loans, and
abuse of foreclosures
.
In June, the Supreme Court ruled that the White House has the power to fire the director of the Consumer Financial Protection Office for no reason and rejected a federal law that sought to impose limits on presidential oversight of independent agencies.
That means Biden will be free to replace Kathleen Kraninger, the current head of the office, with someone who will oversee the businesses and
enforce the law more strictly
.
Katz pointed out that the payday loan regulation and the debt collection rule at the Consumer Financial Protection Bureau are things that could be discussed immediately.
Richard Cordray, the former director of the office, mentioned in an official document earlier this year that the agency should take steps to help people
avoid foreclosure and eviction during the pandemic
, as well as to closely monitor the practices of debt collectors.
© 2020 The New York Times
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