By golly, who could have predicted this? I hate to say I told you so, but … naah, I love to say I told you so. With the election over, and the likelihood increasing by the hour of Congress becoming an even bigger quagmire next session than it is now, it’s now time to play Let’s Make a Deal on a range of issues, including Phase 4 relief on COVID-19 and the omnibus FY2021 budget bill.

The only question now is who gets to play Monty Hall, and for how long. Mitch McConnell is making the opening pitch — and he’s starting off with a major concession:

Senate Majority Leader Mitch McConnell said Wednesday that an economic stimulus bill should be completed before the end of the year and will be the focus when the Senate resumes work next week.

McConnell (R-Ky.) also said that state and local aid — a longtime Democratic demand — could be part of the legislation. …

“We need another rescue package. The Senate goes back into session next Monday. Hopefully the partisan passions that prevented us from doing another rescue package will subside with the election. And I think we need to do it and I think we need to do it before the end of the year,” McConnell said.

“It’s a possibility we will do more for state and local governments,” McConnell said.

McConnell’s stuck now with the possibility that his leverage could end on January 5th. As things stand now, McConnell only has fifty in his caucus guaranteed of seats past then. He needs both David Perdue and Kelly Loeffler to win their runoffs in Georgia on that date, or at least one of them to do so, in order to guarantee that Republicans can help drive negotiations in a Biden administration where Kamala Harris will otherwise determine control of the Senate. Small wonder that he wants a deal now.

That applies to Nancy Pelosi, too. As Allahpundit wrote, there is a non-zero chance that Republicans could take over the House when all the votes get counted in this election. As it is, Pelosi’s lost a lot of her leverage with the losses she’s already sustained in what was supposed to be a blue anti-Trump wave. Even if she gets a narrow Democratic majority, Pelosi needs to demonstrate more flexibility, especially on economic issues, if she expects to win another election as speaker. And if she’s about to hand the gavel back to Kevin McCarthy, Pelosi will want to get what she can now.

Ironically, the sticking point might end up being Donald Trump. If he ends up losing the election, will he want to sign off on another big-spending relief/stimulus bill pushed by the establishmentarians who he perceives as the swamp creatures who frustrated his agenda? Or will he go out in a Jesse Ventura-esque huff that would force Congress to override a veto?

Anyway, it’s getting more and more clear that more stimulus will be necessary. COVID-19 cases are rising sharply to six figures a day, even if deaths are remaining relatively stable for now. Governors will get more pressure to start applying new restrictions on in-person commerce. Today’s report on weekly initial jobless claims doesn’t show much improvement in the job market, although the number of people on paid benefits continues to shrink considerably:

In the week ending October 31, the advance figure for seasonally adjusted initial claims was 751,000, a decrease of 7,000 from the previous week’s revised level. The previous week’s level was revised up by 7,000 from 751,000 to 758,000. The 4-week moving average was 787,000, a decrease of 4,000 from the previous week’s revised average. The previous week’s average was revised up by 3,250 from 787,750 to 791,000.

The advance seasonally adjusted insured unemployment rate was 5.0 percent for the week ending October 24, a decrease of 0.3 percentage point from the previous week’s unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending October 24 was 7,285,000, a decrease of 538,000 from the previous week’s revised level. The previous week’s level was revised up 67,000 from 7,756,000 to 7,823,000. The 4-week moving average was 8,244,500, a decrease of 827,250 from the previous week’s revised average. The previous week’s average was revised up by 18,500 from 9,053,250 to 9,071,750.

That’s a plateau at a high level of churn for a recovery, even considering the originating point. We already have evidence that consumers have run low on disposable income and savings from the last GDP report, and today the Washington Post reports that retailers are seeing a drop in activity. Is it the election, or are they running out of cash — and confidence in their continuing income?

The country’s post-election state of political limbo is causing many Americans to hit the pause button on just about every type of purchase during what retailers had hoped would be an early holiday shopping season.

That uncertainty, retail analysts say, deals yet another setback to an industry that has already dealt with its share of challenges this year. Consumer spending, which typically drives about two-thirds of the economy, suffered a huge blow early in the pandemic, though it has been ticking up in recent months. But with inconclusive results casting new doubts about the country’s political and economic future, some worry that those gains could soon be wiped away.

“Covid-19 is running rampant, there was no vaccine by Election Day and unemployment is still at grotesque recessionary levels,” said Mark Cohen, director of retail studies for Columbia Business School. “Roll that up in a ball, add in the vagaries of the election, and it all speaks to a pretty grim holiday retail season. This is not going to be a banner year for sweaters and handbags.”

Americans spent $2 billion online on Election Day — a 27 percent increase from a year earlier, but still about 11 percent less than in the preceding two days, according to Adobe Analytics, which analyzed more than 1 trillion visits to U.S. retail sites. The group said it expects online sales to dip by as much as $300 million on Wednesday while the country awaited election results.

Election results? Perhaps, but this from the GDP report seems more likely a cause:

The end of stimulus programs had a sharply negative impact on personal income (-$540.6B), disposable income (-$636.7B), and personal savings (-$1.93 trillion) in Q3. Real disposable personal income is down 16.3% in Q3, which means that this V-shaped recovery is at risk of running out of gas soon, unless people get back to work ASAP or more stimulus money gets to employers and consumers in the next few weeks.

That matters in a consumer-driven economy. The rise in Q3 is directly attributable to a 40.7% increase in PCEs, as well as an 83% increase in private domestic investment. Bear in mind that the latter is likely in significant part investments in social-distancing infrastructure and not necessarily business expansion. The increase in equipment costs (70%) accounts for much of this overall rise. This is the cost of doing business in the COVID-19 world, not an indication of explosive future growth. And it was likely funded mainly through stimulus funds.

That was a red alert on the economic prospects for Q4. With the pandemic’s transmission rates escalating by the day, it’s time for more intervention as governments at all levels look for ways to get it back under control. Whoever plays Monty Hall needs to get the show started ASAP.