WASHINGTON – House Democrats on Friday passed a $3 trillion tax cut and spending bill aimed at addressing the devastating economic fallout from the coronavirus outbreak by directing huge sums of money into all corners of the economy.
But the White House and Senate Republicans have decried the measure’s design and said they will cast it aside, leaving uncertain what steps policymakers might take as the economy continues to face severe strains.
The sweeping legislation, dubbed the “Heroes Act, passed 208-199. Fourteen Democrats defected and opposed the bill, reflecting concerns voiced both by moderates and liberals in the House Democratic caucus about the bill’s content and the leadership-driven process that brought it to the floor. The bill won support from just one Republican: Rep. Pete King of New York.
House Speaker Nancy Pelosi, D-Calif., pushed forward despite the divisions in her caucus and GOP opposition, arguing that the legislation will put down a marker for Democrats’ priorities and set the stage for negotiations on the next bipartisan relief bill.
Americans “are suffering so much, in so many ways. We want to lessen their pain,” Pelosi said during House floor debate Friday. “Not to act now is not only irresponsible in a humanitarian way, it is irresponsible because it’s only going to cost more, more in terms of lives, livelihood, cost to the budget, cost to our democracy.”
The 1,800-page legislation contains a large number of provisions: nearly $1 trillion for state, local and tribal governments; another round of direct payments to individuals, up to $6,000 per family, including to unauthorized immigrants; $200 billion for hazard pay for essential workers; $75 billion for coronavirus testing and tracing; increased spending on food stamps; $175 billion in housing support; student loan forgiveness; and a new employee retention tax credit and extension of unemployment benefits.
It also includes measures less directly related to the economic impact of the coronavirus crisis. It would require all voters to be able to vote by mail beginning this November and temporarily repeal a provision from the 2017 GOP tax law that limited a federal deduction for state and local taxes, something that would largely help higher-income areas. The legislation would provide $25 billion for the U.S. Postal Service, spending President Donald Trump has vociferously opposed as he has pressured the agency to charge higher rates to Amazon and others.
“The bill is simply a Democratic agenda masquerading as a response to the coronavirus pandemic,” said Rep. Tom Cole, R-Okla. “The bill will go nowhere and go there fast. . . . Why we’re going through this exercise rather than negotiating in a bipartisan manner is beyond my understanding.”
The White House issued a formal veto threat against the legislation earlier this week.
As Washington scrambled to deal with the growing impact of the coronavirus pandemic earlier this year, the White House, state governments, local officials and businesses took steps to send many Americans home as a way to try to contain the contagion. This led to a mass wave of layoffs that began more than two months ago and has continued every week since, particularly as Americans have sharply pulled back spending.
Congress has passed four bipartisan coronavirus relief bills that have already cost around $3 trillion to try to blunt the economic fallout. While Republicans and Trump administration officials agree that more action will be necessary at some point, many say it’s time to pause and see how the programs already funded are working before devoting even more federal funds to the crisis as deficits balloon.
“The president has said he would talk about state and local aid, but it cannot become a pretext for bailing out blue states that have gotten themselves into financial trouble, so while he’s open to discussing it he has no immediate plans to move forward,” White House press secretary Kayleigh McEnany said Friday, adding, “The Pelosi bill has been entirely unacceptable.”
In a reflection of clashing priorities that might make it difficult to come to agreement on additional relief legislation, White House National Economic Council Director Larry Kudlow on Friday floated slashing the 21 percent corporate tax rate in half for companies that return operations to the United States from overseas, a dramatic change that drew immediate opposition from Democrats.
The White House has also called for a payroll tax cut and new legal liability protections for businesses in any future legislation, policies that have already been rejected by Democrats and – in the case of the payroll tax cut – some Republicans as well.
Trump himself is pushing for the economy to reopen as quickly as possible and said recently that he’s in “no rush” to sign off on additional spending.
That argument angers Democrats who say Republicans are turning a blind eye to the tens of millions of Americans who have lost their jobs. They also point to comments from Federal Reserve Chair Jerome Powell, who warned this week of a prolonged economic downturn and said additional spending would be “costly but worth it.”
Friday’s floor debate proceeded in what has become the new normal for the House: The chamber was largely empty except for members who were speaking or presiding and some staff. Most lawmakers of both parties were wearing masks, although a handful of Republicans were not, and about two dozen lawmakers were absent. When it came time to vote, lawmakers cycled in and out of the chamber in small groups assembled alphabetically, so that a vote that would normally take 15 minutes to stretched to well over an hour. The chamber was repeatedly being cleaned and wiped down.
As the pandemic unfolds with no end in sight, the House also voted Friday to approve a rules change allowing for remote voting by proxy, so future votes can happen without all members present. Republicans opposed the rules change, calling it unconstitutional, while Democrats said it was necessary so the House could continue to conduct business safely.
Pelosi navigated competing demands in her own caucus as she assembled Friday’s coronavirus bill. Lawmakers including members of the Congressional Progressive Caucus had pushed for a “Paycheck Guarantee” program that would offer more generous assistance to individuals than the new round of one-time payments included in the bill. Progressive Caucus co-chair Rep. Pramila Jayapal, D-Wash., was among those opposing the legislation Friday, saying it “ultimately fails to match the scale of this crisis.”
Some moderate lawmakers, including freshmen who flipped GOP-held seats and face challenges in November, expressed unease about forcing through what they viewed as a partisan messaging bill. And lawmakers in both camps complained about a process that presented them with a mammoth bill written largely at the leadership level and little time to review it.
“Unfortunately, many members of Congress – including some in my own party – have decided to use this package as an opportunity to make political statements and propose a bill that goes far beyond pandemic relief and has no chance at becoming law, further delaying the help so many need,” Rep. Abigail Spanberger, D-Va., said in a statement Friday announcing her opposition to the bill.
But as they head toward the November elections, the large majority of Democrats came together behind the bill, endorsing an activist role for the federal government in helping the nation climb out of the economic crater caused by the pandemic.
“This is the legislation the American people expect from their representatives during this crisis,” said Majority Leader Steny Hoyer, D-Md. “It is a bold response to an unprecedented challenge.”
Just ahead of final passage of the bill, Democratic leaders wrangled the votes to defeat a last-minute obstacle: An attempt by Republicans to attach an amendment that would have struck language in the bill extending an earlier round of stimulus checks to unauthorized immigrants. Had it been adopted, the amendment would have imperiled passage of the underlying bill because of opposition from liberal and Hispanic lawmakers.
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The Washington Post’s Mike DeBonis contributed to this report.