Lawmakers in Washington, DC, are rushing to a deal on more coronavirus relief efforts, including direct cash payments to millions of Americans. They will continue negotiations this weekend.
A $ 908 billion bipartisan proposal initially dropped so-called incentive checks, but instead focused on providing weekly unemployment support to unemployed workers. But a last-minute addition to the package could include another round of payments of $ 600 for individuals, according to analysts from investment bank Raymond James.
That’s half of the $ 1,200 payments made to about 160 million Americans this spring under the $ 2 trillion Coronavirus Aid, Relief and Economic Security, or CARES Act. Some senators, including Bernie Sanders of Vermont, have pushed for each new stool bill to include a new round of checks worth $ 1,200 for low- and middle-income Americans. Sanders, who is joined by Josh Hawley, a Missouri Republican senator, promised to force a vote on the proposal before lawmakers suspend for the year on December 18.
Hawley said on Wednesday that the potential for a round of checks, even at $ 600 per adult, was a “good move in the right direction.” But, he added, “I think it should be $ 1,200.”
Negotiations are “very likely” to continue through the weekend As congressional leaders rush to reach an agreement, Senate Leader Mitch McConnell said Thursday. An eleven-hour proposal by a Republican lawmaker had stalled negotiations on Friday morning. Senate Majority Whip John Thune emphasized a suggestion by Senator Pat Toomey to phase out the Federal Reserve’s emergency credit programs.
“As of Friday, talks ran into a problem with the inclusion of language that would limit the Fed’s ability to restart expiring loan programs in 2021 under a Biden administration,” Raymond James analysts wrote in the Dec. 18 research note.
Still, the stimulus talks are “now closer than ever since the CARES Act,” the analysts said.
Punting on state and local aid
The current negotiations are based on a $ 908 billion proposal from a bipartisan coalition of senators. But because that package included $ 160 billion in battle aid state and local governments, which Republicans objected to, as well as a corporate liability shield, which Democrats opposed, the group split the bill into two bills – essentially the controversial issues in a smaller, separate package that can be discussed at a different time.
Instead, the first bill would consist of a $ 748 billion measure, which is expected to include additional funding for the popular Paycheck Protection Program and unemployment insurance, among others.
Delaying $ 160 billion in funding for state and local governments could be key to finding support for another round of stimulus payments, Raymond James said.
“The cost of the CARES Direct Payments Act was about $ 300 billion; cutting the checks in half would be $ 150 billion,” the analysts wrote. “Swapping the $ 150 billion in direct payments for $ 160 billion in state and local aid would create a total bill of $ 900 billion that is reported.”
Emergency unemployment benefits can be halved
The $ 748 billion measure would help millions of unemployed workers by adding 16 weeks to the unemployment programs now ending in late December. The Pandemic Unemployment Compensation (PUC), which had provided $ 600 a week to unemployed workers until it expired in July, would be extended with a weekly benefit of $ 300. The plan would also extend a federal deportation moratorium for an additional month, until the end of January. .
“This package is far from perfect – there are major omissions, including a reduction in the PUC from $ 600 to $ 300 and no continuation of paid time off,” said Andrew Stettner, an unemployment expert at The Century Foundation, a left-wing think tank. “Nonetheless, the proposal is a hefty down payment for aid to unemployed workers and the entire economy.”
House Speaker Nancy Pelosi and Senate Leader Mitch McConnell and other congressional leaders spoke on Dec. 15 to discuss the aid package and a broader government spending bill, with Treasury Secretary Steven Mnuchin calling in, Pelosi’s spokesman said on Twitter.
“The speaker and secretary Mnuchin spoke by phone for 1 hour and 7 minutes at noon and discussed the latest news on COVID and Omni talks. The secretary will attend the Four Corners leaders meeting by phone today at 4:00 PM,” Pelosi wrote. spokesman Drew Hammill on Twitter.
Splitting the bill could increase the likelihood of unemployment benefits renewing before the end of the year, Heights Securities said in a research note. Analysts said there is an “almost categorical 80% that Congress will implement at least a moderate stimulus ($ 400-750 billion) before the week is over.”
The politically charged debate about additional stimulus funding leaves millions of households in the dark about any aid they might receive in the coming weeks. For many people, the financial picture is fading as winter approaches and coronavirus cases hit new daily highs.
In late November, more consumers said they felt a financial impact from the COVID-19 crisis, reaching nearly 6 in 10 people and representing the second consecutive monthly increase in hardship, according to a TransUnion survey. Also job growth in the US. slowed down sharply in November, raising concerns that the economic recovery is losing momentum.
“Ticking time bomb”
Some consumers, meanwhile, say they’ll need far more than a one-time $ 1,200 payment to survive until the coronavirus vaccine is more widely available next year.
“Our [COVID-19] numbers are greater than ever and the magnitude of this pandemic is almost limitless, but the help is not, ” restaurant owner Stephanie Bonin told CBS MoneyWatch. She has a Change.org petition calling on Congress to give people $ 2,000 a month. received nearly 2 million signatures.
She added, “Whether PPP, whether controlling the stimulus, they’ve dried up one by one and nothing else has taken their place.”
December 26 ‘feels like a ticking time bomb,’ added Bonin, referring to the date when unemployment benefits expire for 12 million unemployed workers. “None of it is enough – be it $ 600 or a one-time check for $ 1,200 – nothing is enough to meet the need.”
In the meantime, millions of American families are struggling to pay their bills and are being fired remain historically high. Of the consumers affected by the pandemic, about 8 in 10 are concerned about their ability to pay their bills – half of whom say they are concerned about paying their rent or mortgage, according to the TransUnion survey .
“Nearly two in five affected consumers say they really need a future stimulus check and don’t know how they will get by without it,” the credit rating agency found.