- The bipartisan group of senators unveiled a $ 908 billion incentive plan that includes federal unemployment benefits but leaves out an additional $ 1,200 in direct payments to taxpayers.
- The plan also includes support for strapped states and local governments.
- The compromise package is a concerted effort to break the deadlock on Capitol Hill over another coronavirus eradication plan, but it is unclear whether it will be able to adhere.
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The bipartisan group of senators unveiled a $ 908 billion stimulus plan on Tuesday aimed at breaking the deadlock on Capitol Hill for months. It is a concerted effort that occurs when Congress faces increasing pressure to act before the end of the year, keeping people struggling with the imminent end of many programs.
The plan was introduced by a legislative group that includes the Democratic Senate of Joe Manchin, West Virginia; Susan Collins, Maine Republican Senator; and Democratic Senator Mark Warner of Virginia. “Our emergency assistance is needed now more than ever,” Manchin said at a news conference.
The provisions of the plan include:
- The $ 300 a week in federal unemployment benefits will run for 18 weeks with retroactive effect from December 1st.
- $ 240 billion in new Paycheck Protection Program support for small businesses.
- $ 160 billion in state and local government funding.
- $ 51 billion in new health and vaccination-related funds.
- Temporary liability protection for businesses against corona virus lawsuits.
But the compromise plan missed another $ 1,200 incentive check, presumably in an attempt to keep the plan’s price tag below $ 1 trillion. Previous efforts by Republicans have sought to get such an stimulus package in July because many GOP senators were reluctant to support a costly plan, pointing to rising public debt.
Both Democrats and President Donald Trump support a second wave of direct payments from taxpayers.
Lawmakers have not passed another coronavirus eradication bill since the spring, when Congress pumped more than $ 3 trillion to support individuals and businesses as the economy collapsed under the weight of the coronavirus epidemic. Negotiations between the White House and congressional Democrats eventually went nowhere during the summer and before the election.
Instead, Senate Majority Leader Mitch McConnell has been announcing a $ 500 billion aid plan for months to provide funding for schools, public health systems and small businesses. But Democrats have blocked it twice, arguing that this is not enough to tackle the dual economic and health crisis. At least $ 2.2 trillion in additional spending was sought.
The Trump administration largely withdrew from the aid talks and blamed McConnell. On Tuesday, McConnell said he was in talks with the White House to develop a plan that could call for President Donald Trump’s support. Since his election from President-elect Joe Bident, he has been largely silent on the matter.
Read more: Lawmakers have now unveiled a $ 908 billion coronavirus incentive agreement that would increase unemployment payments and help small businesses. Here’s what’s in the package.
The economy needs more government support, experts say
Most experts say the economy needs more government support as it enters a dangerous phase of the pandemic. Cases of coronavirus are on the rise across the country, encouraging states to renew restrictions in order to prevent the virus from spreading.
Nearly 12 million people are also at risk of losing their unemployment benefits the day after Christmas if Congress does not enter. Other protections will expire next month, such as an eviction moratorium and deferral of student loan payments.
Ernie Tedeschi, policy economist at Evercore ISI, says the plan will help support people and businesses early next year when elected president Joe Biden takes office. But he was concerned that programs to help the unemployed would have to set another expiry date, similar to the March approach of the CARES law.
“Setting a package end date is a risk because we don’t know how the virus will develop,” Tedeschi said in an interview. “The United States is entering difficult winter months and will likely be March 31 at the very beginning of vaccine distribution.”
Some conservatives argue that the U.S. economy is recovering on its own, citing an unemployment rate that has fallen from 14.7% in April to the current 6.9%.
“There’s no need for another trillion-dollar spending bill, the economy is growing much faster than everyone thought,” Steve Moore, President Donald Trump’s external economic adviser, told Business Investor. “The stock market is booming, and the only thing holding back the economy is these blue states that are closing their businesses.”
Senate minority leader Chuck Schumer on Tuesday called for a compromise.
“We need to come together and come to an agreement that doesn’t fully satisfy any of us, but does the job,” Democrats in New York said on the Senate floor on Tuesday.