Stimulus Checks Unlikely In Upcoming Pandemic Relief

Tuesday was a busy day for stimulus negotiations on Capitol Hill. 

Shortly after the White House proposed a $916 billion stimulus package this week, Democrat leaders turned down the offer hours following a new proposal from Senate Majority Leader Mitch McConnell Tuesday afternoon. 

Both parties’ moves serve to exasperate a fragile situation further and offer no peace of mind for struggling Americans during the pandemic. 

“The President’s proposal starts by cutting the unemployment insurance proposal being discussed by bipartisan Members of the House and Senate from $180 billion to $40 billion,” House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer (D-NY) claimed in a joint statement. “That is unacceptable.”

The White House’s deal has a marginally larger price tag compared to the $908 billion bipartisan offer introduced last week, which Democratic leaders support as the framework for a future relief bill. 

But despite the $916 billion price tag, The White House measure would allocate just $40 billion for extended and enhanced federal unemployment benefits — coming far below the $180 billion suggested in the bipartisan plan. 

While on the Senate floor Wednesday morning, McConnell referred to Pelosi and Schumer’s statement as “schizophrenic. “Secretary Mnuchin tried another new tact and sent over an offer,” the Senate Majority Leader said. “And in a bizarre and schizophrenic press release, the speaker and the leader said the administration was obstructing negotiations by negotiating.”

The White House proposal also contained obstacles for Democrats and the GOP, such as virus-related liability protections for businesses, schools, and organizations that reopen during the pandemic, which several Democrats referred to as a “poison pill.”

Additionally, the Trump administration’s latest version rejects funding for state and local governments, which the president, McConnell, and other Republicans consider a “blue state bailout.”

In an interview with Yahoo Money, American Enterprise Institute scholar Norman Ornstein said, “The White House involvement is significant here. Republicans are loyal to him [the president] if you’ve got a proposal that got the White House approval, that may include money that even Mitch McConnell doesn’t particularly want, they might still support it.”

Treasury Secretary Mnuchin, who introduced the White House bid to House leaders on Tuesday, said that McConnell and House Minority Leader Kevin McCarthy also assessed the offer, despite McConnell repeatedly pushing for a stimulus package under $500 billion.

“While it is progress that Leader McConnell has signed off on a $916 billion offer that is based off of the bipartisan framework,” Pelosi and Schumer continued in their statement. “The President’s proposal must not be allowed to obstruct the bipartisan Congressional talks that are underway.”

Prior to the White House’s latest strategy, the Senate Majority Leader recommended leaving out liability protections and funding for state and local governments so lawmakers could approve another bill before the end of the year.

On Tuesday, McConnell told reporters, “What I recommend is we set aside liability and set aside state and local and pass those things that we can agree on. We’ll be back at this after the first of the year.”

In response, Pelosi chalked McConnell’s remarks up as “efforts to undermine good-faith, bipartisan negotiations,” describing them as “appalling.”

Meanwhile, Progressive Democrats are pushing for another round of direct payments to Americans, which the White House offer does not contain and will likely be excluded in the next measure.

“COVID relief needs to directly help everyday people,” New York Senator Alexandria Ocasio-Cortez tweeted Friday. “People need stimulus checks and UI [unemployment insurance].”

Other notable Progressive leaders, including Vermont Senator Bernie Sanders, Minnesota Representative Ilhan Omar, Michigan Representative Rashida Tlaib, and Massachusetts Representative Ayanna Pressley, backed Ocasio-Cortez’s call for more stimulus checks in the next relief bill.

Last Friday, Sanders issued a statement denouncing the bipartisan deal as “unacceptable” as it “does not even do what the CARES Act did and provide, at the very least, a $1,200 direct payment to working class Americans and $500 for their kids.” 

“Tens of millions of Americans living in desperation today would receive absolutely no financial help from this proposal,” Sanders continued. “That is not acceptable.”

Omar reiterated her fellow lawmakers’ beliefs on Twitter last Friday. At the same time, Tlaib and Pressley called for recurrent checks, with Tlaib suggesting in a tweet last Thursday that they should be distributed “monthly.”

An estimated 12 million unemployed workers are expected to lose critical lifelines at the end of the month when the Pandemic Unemployment Assistance (PUA), Pandemic Emergency Unemployment Compensation (PEUC), and Extended Benefits (EB) expire. In addition, Americans will also lose protections under a federal eviction ban, paid sick leave, and relief for state and local governments.

As Congress hashes out a bill to stop a partial federal shutdown in two weeks, Pelosi and McConnell have agreed that more pandemic relief will come with the federal funding bill. 

“They can pass something within the next two weeks,” Ornstein told Yahoo Money. “The impetus for this is the red states, the rural states that are really hurting now, as much as the others. There’s pressure on Republicans to get something done as well.”

 

Sources
  • Tsekova, Denitsa. “Stimulus Talks in Disarray: White House Proposal Rejected, McConnell Describes Democratic Statement as ‘Schizophrenic’.” Yahoo!, Yahoo!, 9 Dec. 2020, money.yahoo.com/stimulus-talks-democrats-white-house-mcconnell-144019982.html.
  • Tsekova, Denitsa. “Second Round of Coronavirus Stimulus Checks a Key Issue for Outspoken Progressive Democratic Wing.” Yahoo!, Yahoo!, 4 Dec. 2020, money.yahoo.com/second-round-of-coronavirus-stimulus-checks-a-key-issue-for-outspoken-progressive-democratic-wing-222148330.html.
Ian Schindler