A bipartisan group of Senators and House members on Tuesday unveiled a new $ 908 billion plan for Covid-19 emergency relief funding to expand unemployment benefits and small business loans.
The proposal comes after months of deadlock over stimulus talks and at a critical time in the Covid-19 crisis. About 14 million Americans receiving unemployment benefits will see those programs expire at the end of the month unless Congress acts, and cities and states across the country are also facing massive budget deficits.
The plan, led by Senators Joe Manchin (D-WV) and Susan Collins (R-ME) and also supported by the bipartisan House Problem Solvers Caucus, is designed to be a short-term extension of federal aid to the A winter is approaching when Covid-19 cases are on the rise again and unemployment claims are on the rise. The funding would extend benefits until April 1, when many public health experts expect large-scale vaccine distribution to be underway.
“This will get us through the most difficult times,” Manchin said at a press conference on Tuesday announcing the framework.
The question in the future is whether the plan can garner support from Senate Majority Leader Mitch McConnell and House Speaker Nancy Pelosi. Several Senate votes for a “skinny” $ 500 billion stimulus bill backed by McConnell and the Republicans failed, without Democratic backing. House Democrats, meanwhile, recently passed a revised $ 2.2 trillion. version of their HEROES law in October.
“We haven’t had any assurance from them on that for a vote, but I think the American people will put [on] the pressure, ”Manchin told reporters. “We are determined not to go home until we do something, so it’s up to them to work with us. We want to work with them. “
No new coronavirus aid program will pass through the Senate without bipartisan support, so the new plan is a signal that Republicans and Democrats are indeed talking. Lawmakers backing the plan stressed on Tuesday that while each side won’t get exactly what they want, their framework contains key points of agreement.
McConnell is circulate his own proposal among Republicans in the Senate, after he and Minority House Leader Kevin McCarthy met with White House officials on Tuesday to determine what President Donald Trump wanted out of a coronavirus relief deal. McConnell’s version of an emergency package is more limited, only providing for a one-month extension of unemployment benefits, rather than the three-month extension in the bipartisan proposal. Pelosi and Senate Minority Leader Chuck Schumer also sent McConnell a separate proposal on Monday evening.
“Further relief from COVID is long overdue and must be embraced in this lame duck session,” Pelosi said in a statement Tuesday.
With November’s election in the rearview mirror and cases of the coronavirus spreading across the country, there could be new momentum behind reaching a deal. But there’s still a long way to go, and Trump – who has proven the wild card for many deals with Congress – is still very much in attendance.
What does the bipartite proposal contain
This new proposal is a $ 908 billion package that reuses $ 560 billion of unused funds from the CARES Act, the $ 2.2 trillion stimulus package passed in March, which means this new proposal does not add that $ 348 billion in new spending. It is much smaller than the $ 2.2 trillion revised HEROES An act that House Democrats passed in October, but more than the $ 500 billion Senate Republicans proposed in October.
Two major sticking points in the negotiations were whether there should be another round of stimulus checks (a priority for Pelosi and Trump) and liability protections for companies that fear prosecution for exposing customers and workers to Covid-19 (a McConnell priority). Republicans have come out on top on both of these issues (at least in this initial proposal) – stimulus checks are not included in this new bipartisan proposal and the framework provided by Senator Manchin’s office notes that the proposal “will provide federal protection. short-term against Coronavirus-related lawsuits in an attempt to give states time to develop their own response. “
Pelosi and Trump have both shown support for another round of stimulus payments for American workers.
Here’s what really makes the proposition:
- $ 160 billion for state, local and tribal governments. As a reminder, American cities alone are facing a deficit of 360 billion dollars and are forced to pursue austerity measures to balance their budgets. As Emily Stewart reported for Vox, the state’s budget deficits could exceed $ 500 billion. In other words, that money could be a drop in the bucket. The woes of states and local governments were lower on McConnell’s priority list – at one point he suggested that states declare bankruptcy.
$ 180 billion in unemployment insurance (UI). The CARES Act gave unemployed Americans a weekly lifeline of $ 600 on top of state unemployment insurance, a move widely seen as averting a catastrophe for the millions of Americans who lost their jobs this year. . As Dylan Matthews reported for Vox, research has shown that “the average UI recipient is paid 134 percent of their previous salary,” and this may have temporarily reduced the poverty rate.
This program expired in August, so any help will be welcome for those who are still unemployed. Congress initially estimated the unemployment insurance program would cost $ 260 billion The Center for Fiscal Policy is seen as an underestimate, it is therefore probable that this extension does not cover the total cost of the needs of the unemployed. The Washington Post reported that this amount would cover an additional $ 300 per week for four months.
- $ 288 billion to support small businesses. Part of this support will come from the Paycheck Protection Program (PPP) and Disaster Economic Damage Loans. As Forbes has reported, an August 2020 U.S. Census survey showed that nearly 79% of small businesses reported being negatively affected by Covid-19.
- $ 25 billion in housing assistance. Notably, the new bipartisan proposal only provides for $ 25 billion in rent assistance even as economists predict tenants could owe nearly $ 70 billion in rent arrears by the end of the year. Vox reported that policy experts and advocates have been pushing for $ 100 billion to be included in stimulus talks to avert a deportation crisis that could affect up to 40 million Americans.
The framework also includes $ 45 billion for transportation, including airlines and Amtrak, $ 16 billion for vaccine development and more Covid-19 testing and tracing, $ 82 billion in federal funding for the education, $ 10 billion for the struggling US Postal Service and $ 10 billion for child care, among others.
“This is emergency relief, this is designed to get us through this next quarter,” Senator Lisa Murkowski (R-AK) told reporters. “We know we have more to do, but … we cannot abandon the American people.”
What is the continuation of this proposition
In the coming weeks, Collins, Manchin and the others will have to reach out to many senators to see if they can increase support for the bill. They’ll also have to do a lot of extra work to convince McConnell and Senate Minority Leader Chuck Schumer.
Trump is still president until Biden is sworn in on January 20, and McConnell told reporters he didn’t want to do anything Trump wouldn’t sign. That said, McConnell and Trump in the past have backed two very different numbers for stimulus relief. McConnell has repeatedly attempted to push through a $ 500 billion package, while Trump has expressed support for a package closer to $ 1.8 trillion.
McConnell’s version of an emergency package he sent to his Republican members on Tuesday contains no funding for state and local aid, no money for housing assistance and only provides for a one-month extension of benefits unemployment rather than the three-month extension of the bipartisan proposal. McConnell’s bill contains $ 332.7 billion for PPP loans, $ 100 billion for education funding and $ 47 billion for vaccine distribution, testing, and tracing.
But Democrats are also wary of what Trump – still praising his electoral defeat and refusing to give in to Biden – will do with a stimulus package if it makes it to his office.
Leaders in Congress and the White House may be speaking, but there’s a long way to go in a short time before a deal can be reached.