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Illustration: Eniola Odetunde/Axios

Conservative allies of the president are weighing in on the next tranche of coronavirus relief funding, warning that Trump's reelection could hinge on the economic impact of the new bill — and urging him not to extend unemployment benefits from the CARES Act.

Details: Publishing magnate Steve Forbes and economist Stephen Moore have been warning Treasury Secretary Steven Mnuchin, the administration's lead negotiator on stimulus talks, and members of the White House economic council that the stakes for the new package "couldn't be higher."

  • Moore tells me, "We're very worried about Trump doing a deal with [House Speaker Nancy] Pelosi that would have very negative effects on the economy."
  • Moore predicted that if unemployment benefits from the CARES Act are extended, "You're not gonna have a jobs recovery in the fall. Not only is that bad for millions of Americans, but Trump can't win an election if we don't have a good economy."
  • Instead, they suggested Trump move ahead with a payroll tax cut (something Trump said is a must-have, but other Republicans aren't as keen on).

What's next: Moore and Forbes plan to send President Trump a letter outlining these concerns.

  • The letter will also state that that cutting a bad deal could be "reminiscent" of the Omnibus Budget Reconciliation Act of 1990 under President George H.W. Bush that raised taxes and "cost him the election."
  • They'll also be releasing an ad this week through the Committee to Unleash Prosperity, which was founded by Forbes, Moore and economist Art Laffer, detailing why an extension of the $600 weekly unemployment benefits would be "disastrous" for the president.

Go deeper

Pelosi says Trump is "delusional" for thinking GOP will win the House

House Speaker Nancy Pelosi (D-Calif.) called President Trump "delusional" on CNN's "State of the Union" Sunday for predicting Republicans will win the majority in the House of Representatives.

Why it matters: It's not clear who is telling Trump the GOP has a shot at winning back the House, but most congressional Republicans privately acknowledge that remaining in the minority is a foregone conclusion, Axios' Alayna Treene reports. The real question is how many seats they lose.

Felix Salmon, author of Capital
Updated 3 mins ago - Economy & Business

How central banks can save the world

Illustration: Aïda Amer/Axios

The trillion-dollar gap between actual GDP and potential GDP is a gap made up of misery, unemployment, and unfulfilled promise. It's also a gap that can be eradicated — if central banks embrace unconventional monetary policy.

  • That's the message from Eric Lonergan and Megan Greene, two economists who reject the idea that central banks have hit a "lower bound" on interest rates. In fact, they reject the idea that "interest rates" are a singular thing at all, and they fullthroatedly reject the idea — most recently put forward by New York Fed president Bill Dudley — that the Fed is "out of firepower."

Why it matters: If Lonergan and Greene are right, then central banks have effectively unlimited ammunition in their fight to increase inflation and employment. They are limited only by political will.

Updated 22 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Large coronavirus outbreaks leading to high death rates — Coronavirus cases are at an all-time high ahead of Election Day — Fauci says U.S. may not return to normal until 2022
  2. Politics: Top HHS spokesperson pitched coronavirus ad campaign as "helping the president" — Space Force's No. 2 general tests positive for coronavirus
  3. World: Taiwan reaches a record 200 days with no local coronavirus cases — Europe faces "stronger and deadlier" wave France imposes lockdown Germany to close bars and restaurants for a month.
  4. Sports: Boston Marathon delayed MLB to investigate Dodgers player who joined celebration after positive COVID test.

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