WASHINGTON ― Senate Republicans on Thursday outlined a massive emergency stimulus package totaling at least $1 trillion to prop up an economy paralyzed by the growing coronavirus outbreak and give a one-time check of financial relief to millions of Americans.
The bill would be the third and largest of the government’s response to the crisis. On Wednesday, lawmakers passed and President Donald Trump signed into law Democratic legislation that makes coronavirus testing free, expands unemployment insurance benefits and provides paid leave to some displaced workers.
What the new legislation ultimately will look like hinges on high-stakes negotiations between Senate Majority Leader Mitch McConnell (R-Ky.) and Senate Minority Leader Chuck Schumer (D-N.Y.) ― whose track record on cooperation is hardly stellar. Democrats have leverage over the final shape of the bill because it will require 60 votes for passage and Republicans number 53 in the 100-seat Senate.
“We need to take bold and swift action as soon as possible. The Senate is not going anywhere until we take action,” McConnell said Thursday, indicating that talks with Democrats over the funding package will soon begin.
The GOP proposal includes hundreds of billions in loans for small businesses, many of which were forced to close in recent weeks to fight the spread of the highly contagious disease.
The measure also would provide a direct payment to the majority of Americans, many of whom are struggling to make ends meet as a wide span of business and services have been forced to cease. Taxpayers who earn less than $75,000 in gross adjusted income would receive a maximum of $1,200 from the government (couples earning less than $150,000 would get $2,400). Those amounts increase $500 for every child. The “recovery checks,” as the proposal calls them, would scale down for taxpayers earning above $75,000 to a maximum of $99,000 in gross adjusted income, with those above that figure deemed ineligible for the government checks.
Notably, McConnell’s proposal would provide much less ― only $600 ― to millions of low-income Americans who pay little or no taxes, but who still had $2,500 in qualifying income.
The bill also does not build on and expand the paid leave provisions in the second coronavirus emergency bill that Trump signed on Wednesday, despite assurances that it would. Millions of workers at large companies still are not eligible for sick leave or family leave under the Senate’s proposed bill.
“Despite the president saying earlier this week that he wanted to expand the sick leave provision to workers in larger companies, there’s nothing here that would do that,” said Vicki Shabo, a senior fellow at the Washington-based New America think tank who specializes in paid leave policy.
The idea of sending Americans money to soften the blow of the economic downturn gained traction among both political parties over the last week and has been endorsed by Trump. But some issues still must be resolved ― such as how soon the money can get into the pockets of Americans and whether the payments will give people enough of a financial cushion.
The Republican plan also includes $50 billion in loans for the badly struggling airline industry, as well as $150 billion in lending to other “severely distressed sectors” of the economy. The fund would be controlled by the Treasury Department and could include bailouts to hotels, casinos, cruise lines, and the oil and gas industry.
“We will be helping the airline industry. We will be helping … the cruise ship industry,” Trump told reporters at the White House on Thursday. “You don’t want to lose industries like this.”
Democrats are demanding that any taxpayer bailout to major industries include restrictions on corporate bonuses and stock buybacks. Some are urging the administration to go even further by setting specific conditions ― like a $15 minimum wage ― to benefit workers that will apply beyond the coronavirus crisis.
“Funds must come with strings attached to ensure that the money goes to maintain payroll, not to enrich shareholders or pay executive bonuses,” Sen. Elizabeth Warren (D-Mass.) wrote in an op-ed this week.
Democrats on Tuesday unveiled their own opening bid for the fiscal package, calling for at least $750 billion to boost hospital capacity, unemployment insurance, small business assistance, child care, remote learning and food delivery, and to offer forbearance of all federal loans.
On Wednesday, they released a plan to cancel student loan payments for the duration of the coronavirus emergency and provide a minimum $10,000 payoff for all federal student loan borrowers.
The burden imposed by student debt “has been going on for a long time. It’s exacerbated by the crisis,” Schumer said in a floor speech Thursday. ” We’ve got to help the students and those with big loans on their backs.”
The GOP’s embrace of trillion-dollar spending and government bailouts has struck many as a wonder to behold, given their years-long opposition to such measures as former President Barack Obama took office in early 2009 facing similar economic fallout and millions of job losses because of the Great Recession. Many GOP lawmakers who came to Washington on the back of the 2010 anti-spending Tea Party wave are now fully in support of direct stimulus.
“We occasionally have these great crises and when they occur we are able to rise above our normal partisanship and, in many times, our normal positions because there are not normal times,” McConnell said this week when asked about the Republican reversal on spending.
Emily Peck contributed reporting.
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