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- A bipartisan group of senators unveiled a $ 908 billion stimulus package that contains federal unemployment benefits but omits another round of direct payments of $ 1,200 to taxpayers.
- The plan also includes assistance to struggling state and local governments.
- The compromise package represents a concerted effort to break the deadlock on Capitol Hill on another coronavirus relief plan, but it’s unclear whether it will gain traction.
- Visit the Business Insider homepage for more stories.
A bipartisan group of senators on Tuesday unveiled a $ 908 billion stimulus package aimed at breaking the months-long deadlock on Capitol Hill. It’s a concerted effort that comes as Congress faces increasing pressure to act before the end of the year with several programs coming to an end that keep struggling people afloat.
The plan was put forward by a group of lawmakers that includes Democratic Senator Joe Manchin of West Virginia; Republican Senator Susan Collins of Maine; and Democratic Senator Mark Warner of Virginia. Many of its rescue programs would expire on March 31.
“Our action to provide emergency relief is more necessary than ever,” Manchin said at a press conference.
The provisions of the plan include:
- Federal weekly unemployment benefits of $ 300 retroactive from December 1 for 18 weeks.
- $ 240 billion in assistance for the new paycheck protection program for small businesses.
- 160 billion dollars in funding for states and local communities.
- $ 51 billion in new health care and vaccine funding.
- Six-month corporate liability shield against coronavirus-related lawsuits.
But the compromise plan omitted another round of $ 1,200 stimulus checks, presumably in an attempt to keep the plan’s price below $ 1 trillion. An earlier effort among Republicans to push for a stimulus package of this size failed in July because many GOP senators were reluctant to back an expensive plan, underlining the rising national debt.
Democrats and President Donald Trump are backing a second wave of direct payments for taxpayers.
Lawmakers have not passed another coronavirus relief bill since the spring, when Congress pumped out more than $ 3 trillion to support individuals and businesses as the economy crumbled under the weight of the coronavirus pandemic. Negotiations between the White House and Congressional Democrats ultimately came to naught over the summer and leading up to the election.
Instead, Senate Majority Leader Mitch McConnell for months touted a $ 500 billion rescue plan that funds schools, public health systems and small businesses. But Democrats have blocked it twice and argue it’s not enough to deal with the twin economic and health crisis. They asked for at least $ 2.2 trillion in additional spending.
The Trump administration has largely withdrawn from the relief talks and handed McConnell responsibility. On Tuesday, McConnell said he was in conversation with the White House about devising a plan that could garner support from President Donald Trump. He has remained largely silent on the issue since his electoral defeat to President-elect Joe Biden.
Economy needs more government support, experts say
Most experts say the economy needs additional government support as it enters a perilous phase of the pandemic. Coronavirus cases are increasing across the country, prompting states to renew restrictions in a bid to thwart the spread of the virus.
Nearly 12 million people are also at risk of losing all of their unemployment assistance on Boxing Day if Congress does not intervene. Other protections such as a moratorium on eviction and postponement of student loan payments also expire next month.
Ernie Tedeschi, political economist at Evercore ISI, said the plan would help people and businesses take office early next year when President-elect Joe Biden takes office. But he’s worried about setting another expiration date for federal programs similar to the CARES law that Congress approved in March.
“Setting an end date for the package is a risk because we don’t know how the virus will evolve,” Tedeschi said in an interview. “The United States is entering a difficult winter month and March 31 will likely be the very beginning of vaccine distribution.”
Some conservatives say the US economy is recovering on its own, citing the unemployment rate which rose from a high of 14.7% in April to its current level of 6.9%.
“We don’t need another trillion dollar spending bill, the economy is growing a lot faster than everyone thought,” Steve Moore, an economic adviser, told Business Insider exterior of President Donald Trump. “The stock market is booming and the only thing holding the economy back are these blue states blocking their operations.”
On Monday, Senate Minority Leader Chuck Schumer called for a compromise as congressional leaders face mounting pressure to adopt another relief package as coronavirus cases rise across the country.
“Both sides must give. We have a Democratic House, and in the Senate it is necessary for Democratic votes to pass any bill,” Schumer said in a Senate speech Tuesday. “So we need a real bipartisan bill – it’s not our bill, take it or leave it – that can bring us together and solve the desperate needs of the American people, which we all want to address.”
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