WASHINGTON – A group of about a half-dozen centrist lawmakers on Tuesday unveiled an approximately $908 billion plan that has since gained the support of top congressional Democrats and several senior Senate Republicans, breathing new life into long-stalled talks over critical economic relief.
Lawmakers have not yet released legislative text behind the plan, but a one-page summary provided by the group – titled the “COVID Emergency Relief Framework” – combines many of the central priorities of congressional leaders of each party, as well as those of President-elect Joe Biden.
The framework would meet congressional Democrats’ top demands to provide hundreds of billions in aid to jobless Americans and hundreds of billions of dollars to hard-hit states and cities.
It would also meet Republican’s chief demands to approve new small business funding and, at least temporarily, protect businesses and other entities from coronavirus-related lawsuits. The measure includes other priorities to help the nation through the coronavirus pandemic, such as funding for health officials to help with the distribution of the coronavirus vaccine, as well as aid for hospitals, the hungry, and the U.S. Postal Service.
The effort has been spearheaded by Democratic Sens. Joe Manchin of West Virginia and Mark Warner of Virginia, working alongside Republican Sens. Lisa Murkowski of Alaska, Mitt Romney of Utah, Bill Cassidy of Louisiana and Susan Collins of Maine. Sens. Angus King, I-Maine, Rob Portman, R-Ohio, Marco Rubio, R-Fla., and Maggie Hassan, D-N.H., have also been supportive of the effort. Congressional aides have for weeks been skeptical the group’s work amounted to much more than a publicity stunt, but the push appeared Thursday to have newfound momentum, with numerous Senate Republicans indicating their support for the idea.
“We’ve got to do something,” King said in an interview. “It would be grossly irresponsible to go home from here and see people lined up at food banks … This is an important step to get us through the next few months.”
Here’s a summary of what we know about what is in the proposal so far.
– Business aid
The spike in coronavirus cases and looming winter months have fueled fears about possible devastation for certain segments of the American economy. In particular, restaurants, hotels, airlines, and bus companies, among other industries hit hard by the pandemic, have warned of mass layoffs and dire consequences in the coming months without federal assistance.
As a result, the most expensive item in the Senators’ bipartisan plan is $288 billion in assistance for American businesses, with lawmakers insisting this pot of funding be primarily geared toward assisting small firms. As with most of the bipartisan “framework,” the specifics of how that funding would be apportioned remains largely unclear at the moment.
The centerpiece of the business aid program is expected to be another round of funding for the Paycheck Protection Program, which has already doled out hundreds of billions in forgivable small business loans – often with significant controversy – to millions of American firms. This new funding would allow businesses that have already exhausted their PPP funding to apply for another round of payments. This time, firms applying for PPP funding will almost certainly be required to demonstrate substantial declines in revenue to qualify for assistance.
Part of the $288 billion would also likely be used for targeted help specifically for restaurants, which are expected to be slammed by the closure of outdoor dining in the coming winter months. It would also include another round of Economic Injury Disaster Loans, which offers smaller loan amounts than PPP.
Once the top-line numbers are agreed to, the bipartisan group is expected to leave the details to the leaders of the Senate’s small business committee. Those senators – Rubio and Ben Cardin, D-Md. – would then be expected to negotiate specifically how the $288 billion is apportioned in economic relief for firms. Talks between Rubio and Cardin over another round of PPP funding collapsed in recent days, suggesting it may be hard for them to reach a quick agreement.
– Aid for jobless Americans
The second most expensive funding item in the bipartisan framework consists of $180 billion for unemployment benefits to jobless Americans.
Under the bipartisan plan, Americans on unemployment would receive $300 per week from the federal government on top of their existing state unemployment benefits, assuming those have not been exhausted. In March, Congress approved a federal unemployment benefit of $600 per week that expired at the end of July as negotiations between lawmakers collapsed. President Donald Trump unilaterally approved a $300 per week unemployment bonus in August, although most of that money in turn expired by October.
About 20.2 million Americans are currently receiving jobless aid, according to data released Thursday by the federal government, and may face long odds securing employment during the winter. Many economists say providing federal unemployment benefits is necessary to allow these families to continue to meet their basic needs and pay their bills, which in turn will help stave off a broader economic contraction.
Senate Majority Leader Mitch McConnell, R-Ky., as recently as September released legislation calling for the U.S. to provide $300 per week to jobless Americans. Earlier this week, however, McConnell circulated a proposal that would provide $0 in additional benefits to the unemployed, as conservatives have for months complained that unemployment benefits discourages jobless Americans from finding work. McConnell’s office declined to answer questions about the change in position, and it was unclear how or if the differences could be reconciled in a final agreement.
One significant outstanding question facing lawmakers is whether the unemployment benefits will be made retroactive to cover prior months when jobless benefits were not being paid. The unemployment benefit in the bipartisan plan would cover at least January through March, but lawmakers have not decided whether it would compensate for lost benefits from the fall. Manchin has pushed for it to do so but faces resistance from Republicans in the group, according to multiple aides with knowledge of internal deliberations.
Sens. Charles Grassley, R-Iowa, and Ron Wyden, D-Ore., the two leading members of the Senate Finance Committee, are expected to iron out many of the specifics of the unemployment section of the legislation should a bill move toward passage.
– State and local funding
A key drag on the American economy has proven the shedding of state and local jobs, with 1.2 million being lost so far. Another 300,000 are at risk with no federal help, said Lucy Dadayan, senior research associate at the Urban-Brookings Tax Policy Institute.
“State and local governments play a crucial role in providing services, which we need at the time of a public health crisis,” Dadayan said.
The bipartisan plan proposes funneling $160 billion to state and local governments to help them through the next several months without further cuts to personnel or services. That provision has already sparked substantial controversy among congressional Republicans, who for months have denounced aid for these governments as “bailouts” for profligate Democratic lawmakers. Other Republican lawmakers are seeking to approve new guardrails on state and local money as a condition for their support of the broader package.
“I’m very disappointed that a proposal from some of my colleagues today apparently includes provisions that spends hundreds of billions of dollars in taxpayer money to bail out wasteful states,” Sen. Rick Scott, R-Fla., one of the conservatives, said in a statement about the bipartisan proposal.
Dadayan said the $160 billion would be woefully inadequate, citing her projection of a $200 billion shortfall in tax revenue alone for this and next fiscal years. “It’s nothing,” she said.
Temporary liability shield. If Republicans are expected to struggle the most accepting legislation with state and local funding, Democrats are expected to struggle the most accepting the “liability shield” sought by the GOP.
The business lobby and Senate Republicans have for months sought to give firms and other entities immunity from coronavirus-related lawsuits, which they claim represents a frivolous drag on the economy. These demands have incensed Democrats, who were already furious at what they see as an overly permissive approach from Trump’s Department of Labor in policing employer handling of covid dangers for their workers.
The one-page summary released by the bipartisan working group includes only one unclear line about the liability shield: “Provide short term federal protection from coronavirus related lawsuits with the purpose of giving states time to develop their own response.”
Lawmakers have discussed a four-month reprieve from covid-related lawsuits, but senior Democrats have balked at that measure despite embracing the broader bill. A number of Republicans have made clear that no stimulus package will pass without including the measure.
Some experts in the issue have denounced the plan and say McConnell should not make it a precondition for providing more economic relief.
“The current framework in the bipartisan proposal is incredibly vague and I do not believe both sides can reach a compromise on this issue,” said Remington Gregg, counsel for civil justice and consumer rights at Public Citizen, a left-leaning group. “No ‘compromise’ on a liability shield is necessary because we shouldn’t give companies a way to escape liability if their actions sicken other.”
– Range of funding for smaller measures
The bill also includes more than a half-dozen other pots of funding aimed at meeting other critical areas of need. These include:
– $82 billion for schools and education funding;
– $45 billion for hard-hit transit agencies, including airlines, airports, buses, and Amtrak;
– $26 billion for agriculture and nutrition assistance, which would aim to head off the enormous hunger crisis emerging nationwide;
– $25 billion in housing and rental assistance to stave off a feared wave of evictions;
– $16 billion to help the government distribute the vaccine, likely a massive undertaking;
– $10 billion for the U.S. Postal Service;
– $10 billion for child care.
– What’s not in the bill
A number of top priorities for both parties are for now still absent the bipartisan agreement. The agreement is also silent on multiple critical deadlines facing Congress over emergency programs that are set to expire.
For instance, the plan does not renew the federal moratorium on evictions that is set to expire at the end of the year. Experts fear the expiration of the moratorium could put 30 million renters at risk of eviction. The plan does not also mention the expiring protections for student debtors; the paid family leave program that helps Americans get paid if they have to stay home while sick; or the unemployment program for gig workers and independent contractors. All three are also set to expire by the end of the year if Congress does not act.
A second round of $1,200 stimulus checks – although supported by congressional Democrats and the president – is also not included in the bipartisan framework. Congressional Republicans are widely seen as resistant to spending more than $1 trillion on another stimulus package. Once state and local funding, small business relief, and aid to the unemployed is added up, lawmakers do not have enough money leftover to both include checks and keep the overall price tag below $1 trillion.
The plan also leaves out a suite of tax cuts that Republicans had sought as part of their earlier stimulus proposals, including Trump’s demand for a payroll tax cut for firms. Democrats’ push for hazard pay, giving bonuses to essential workers and health care professionals who have endangered their lives during the pandemic, was also excluded.