Republican and Democratic Perspectives on the Coronavirus Stimulus Package Delay

Late last week, Senate Republicans unveiled a $1 trillion economic stimulus package designed to combat the growing impact of the coronavirus on the American economy. Senate Majority Leader Mitch McConnell pledged that his chamber would not adjourn until a deal had been reached, and it appeared as though the Senate would pass legislation to send immediate aid to Americans in need. However, Republicans were shocked when Democrats voted against the package, despite provisions being included which they argued alleviated concerns held by Democrats. Any stimulus package needs 60 votes to pass the Senate, and it only received 47. Senate Republicans led by Mitch McConnell blamed House Speaker Nancy Pelosi for tanking the negotiations when she returned to Washington from San Francisco earlier this week to join the deliberations. Republican leaders suspected Pelosi pushed her colleagues in the Senate to vote against the bill in order to rewrite the legislation to include long-held policy desires unrelated to coronavirus relief.

The initial bill proposed by Republicans focused on immediate relief to businesses and workers. Majority Leader McConnell said the plan had four main pillars: payments to small businesses, direct cash payments to individuals, loans to industries disproportionately affected by the virus, and a spike in funding to the health care industry. $300 billion would immediately be made available for loans to small businesses and private companies. The loans would be structured so that the banks that sanctioned them would be guaranteed by the Small Business Administration. The caveat for these loans was that they must be used to pay for salaries, mortgage payments, debt obligations, and paid sick, medical, and family leave. The stimulus proposal also included a provision for “recovery rebates” in the form of direct $1,200 checks to adults, which was included despite opposition from some Republican Senators. President Trump has championed the idea of direct cash payments, whereas Republican Senators are more inclined to increase funding for loans and grants to small businesses to keep people employed. These proposed loans would cost an estimated $500 billion, and the Treasury Department would be in charge of determining who received the assistance.

In its original form, the stimulus package was drafted almost entirely by Republicans, with Democrats only consulted after the framework of the bill had been agreed upon. Leader McConnell was adamant that holding the majority gave his caucus the right to draft the bill unilaterally, and said that Democratic input would be welcomed during the markup sessions. The revised stimulus package to be voted on Tuesday was drafted differently, with direct input from Minority Leader Chuck Schumer and Speaker Pelosi.

Treasury Secretary Steven Mnuchin and Democratic Leader Chuck Schumer announced on Monday night that they were close to reaching an agreement on a revised stimulus package to be voted on Tuesday afternoon. Mnuchin consulted with President Trump and Senator McConnell to ensure that the terms were still acceptable to Republicans. President Trump had previously said he was willing to “work with anybody” to pass a stimulus package, indicating his support for a bipartisan negotiation. Despite this, he took to Twitter to hammer Democratic leaders for playing partisan politics during negotiations, and said Republicans shouldn’t budge from their position. The president has stressed the need to get a package passed immediately to give the struggling economy a jolt. In total, the revised package is estimated to be worth around $2 trillion, and the markets responded to news of the negotiations reaching a conclusion by spiking upward. The Dow Jones Industrial Average jumped by 8%, just a day after a brutal sell off put it on track for its worst month since 1931. Included in the stimulus package negotiated by Mnuchin are provisions for $350 billion to small businesses, $250 billion for health care relief, $11 billion for vaccine development, and $4.5 billion for the CDC. The direct cash payments of $1,200 per adult were also rolled over from the initial Republican proposal, which would total $250 billion in direct aid to individuals.

The core contention for Democrats regarding the originally proposed coronavirus stimulus package is a dissatisfaction with the extent of worker protections in the bill. Overall, they fear that it is not friendly enough for workers and instead focuses too closely on protections for large corporations. Democrats are particularly opposed to the potential conditions imposed on the American public in the bill, which among other things, would allow ailing corporations to receive aid from a pool of $500 billion in taxpayer money.

Senator Sherrod Brown, one of the Senate Democrats opposed to the stimulus package in its original form, stated that “The American people don’t want another corporate bailout. They don’t want a bailout for Wall Street. They don’t want a bailout for the airlines. They want money. If we’re going to do a relief package, the money needs to go in the pockets of workers.” Brown and many of his Democratic colleagues in the Senate have echoed the concern that the Congressional response to the economic crisis brought about by the coronavirus outbreak should not mirror the bailout back in 2008, when the aid that saved the financial system was not made available to average Americans without massive rules and regulations.

Senate Democrats have also criticized GOP lawmakers for refusing to add strong worker protections in the bill by using vague language which only requires companies to keep employees “to the extent possible.” This would allow corporations to keep bailout money, while still being able to fire workers. Democrats are additionally concerned that the bill fails to provide enough support to state and local governments, and that the level of unemployment insurance it offers American workers is not sufficient.

Lastly, Democrats have pushed back on the process being used by their Republican colleagues to advance the legislation. They have taken issue with Senate Majority Leader Mitch McConnell holding arbitrary votes, while negotiators are still attempting to reach bipartisan agreement on the bill. Democrats in the upper chamber have argued that these procedural votes are meaningless because negotiations are still ongoing between the two sides.

During the course of the deliberations, Speaker Nancy Pelosi offered an alternative stimulus plan, one that she personally developed and which gained little support. Pelosi’s plan would cost $2.5 trillion, and while it rolls over some aspects of the Senate’s proposal such as direct cash to Americans, it also makes provisions for policies that are unrelated to the impact of the coronavirus. These policies include $35 million for operations and maintenance on the Kennedy Center for Performing Arts, $11 billion to absolve the Postal Service of its debt, $90 million to the federal program to combat HIV/AIDS, and emission restrictions on airlines, among others. Republicans widely criticized Speaker Pelosi’s plan, and argued that she was playing partisan politics during a time of crisis.

Despite frustrating deadlock between Republicans and Democrats, which included a particularly contentious day on Monday, progress has been made on deliberations regarding the proposed stimulus package and lawmakers are confident that a deal is imminent. New provisions were incorporated into the original plan to appease many of the concerns expressed by House and Senate Democrats. The current iteration of the stimulus package includes: an oversight of funds distributed to large corporations, more support to state and local governments, and a major expansion of the unemployment insurance program. While Senator McConnell said the negotiations were at the “five-yard line,” Minority Leader Schumer was more optimistic, saying they were at the “two-yard line.” Secretary Mnuchin has been in close dialogue with President Trump and his White House legislative staff throughout the entire process, and the president has given his negotiating team the green light to complete the bill. Ultimately, it is in the best interest of everyone – from lawmakers to the president to the American people at large – for a stimulus package to be passed to jumpstart the economy. If the bill passes as expected, it is designed to give immediate relief to the economy. Secretary Mnuchin warned Senators last week that unemployment could soar as high as 20%, and the stimulus proposals are the culmination of efforts to prevent that number from being reached and to provide much-needed relief to the American people during the ongoing coronavirus crisis.

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