Senate passes $2.2 trillion coronavirus aid plan, including $1,200 payments per adult
photo by: Associated Press
WASHINGTON — The Senate passed a mammoth $2.2 trillion economic rescue package steering aid to businesses, workers and health care systems engulfed by the coronavirus pandemic, an unprecedented response amid record new jobless claims and mounting evidence that the economy is in a recession.
The unanimous Senate vote late Wednesday came despite misgivings on both sides about whether it goes too far or not far enough and capped days of difficult negotiations as Washington confronted a national challenge unlike it has ever faced.
Thursday brought grim economic news as the government reported 3.3 million new weekly unemployment claims, four times the previous record, fresh evidence that the U.S. is sinking into recession as coronavirus isolation steps have led to business closures.
Federal Reserve Chairman Jerome Powell said in a televised interview that the economy “may well be in a recession.”
House Speaker Nancy Pelosi, D-Calif., swung behind the bipartisan agreement, saying it “takes us a long way down the road in meeting the needs of the American people.”
The measure is set for House passage on Friday and President Donald Trump’s immediate signature.
The 880-page measure is the largest economic relief bill in U.S. history. Majority Leader Mitch McConnell appeared somber and exhausted as he announced the vote — and he released senators from Washington until April 20, though he promised to recall them if needed.
“Pray for one another, for all of our families and for our country,” said McConnell, R-Ky.
“The legislation now before us now is historic because it is meant to match a historic crisis,” said Minority Leader Chuck Schumer, D-N.Y. “Our health care system is not prepared to care for the sick. Our workers are without work. Our businesses cannot do business. Our factories lie idle. The gears of the American economy have ground to a halt.”
The package is intended as relief for a sinking economy and a nation facing a grim toll from an infection that’s killed more than 21,000 people worldwide.
“This is a unique situation. This is not a typical downturn,” Fed chief Powell told NBC’s “Today” show. “What’s happening here is people are being asked to close their businesses, to stay home from work and to not engage in certain kinds of economic activity and so they’re pulling back. And at a certain point, we will get the spread of the virus under control and at that time confidence will return, businesses will open again, people will come back to work.”
Underscoring the effort’s sheer magnitude, the bill finances a response with a price tag that equals half the size of the entire $4 trillion-plus annual federal budget. The $2.2 trillion estimate is the White House’s best guess.
Insistently optimistic, Trump said of the greatest public health emergency in anyone’s lifetime, “I don’t think its going to end up being such a rough patch” and anticipated the economy soaring “like a rocket ship” when it’s over.
The drive by leaders to speed the bill through the Senate was Wednesday slowed as four conservative Republican senators from states whose economies are dominated by low-wage jobs demanded changes, saying the legislation as written was so generous that workers like store clerks might opt to stay on unemployment instead of return to their jobs. They settled for a failed vote to modify the provision.
Wednesday’s delays followed Democratic stalling tactics earlier in the week as Schumer held out for additional funding for states and hospitals and other provisions.
The sprawling measure is the third coronavirus response bill produced by Congress and by far the largest. It builds on efforts focused on vaccines and emergency response, sick and family medical leave for workers and food aid.
Senate passage delivered the legislation to the Democratic-controlled House, which is expected to pass it Friday. House members are scattered around the country. House Majority Leader Steny Hoyer, D-Md., said the measure would pass by voice vote without lawmakers having to return to Washington.
House Republican Leader Kevin McCarthy said Thursday his members were on board.
“We’ll have a debate, and then we’ll have a voice vote to bring it up and move it to the president’s desk,” he told Fox News Channel. He said that while Democrats inserted things in the bill that didn’t deal with coronavirus, “we will still get this package done for hospitals, workers, small businesses.”
“Every day matters, so we want to get this done quickly,” McCarthy said.
The package would give direct payments to most Americans, expand unemployment benefits and provide a $367 billion program for small businesses to keep making payroll while workers are forced to stay home.
It includes a heavily negotiated $500 billion program for guaranteed, subsidized loans to larger industries, including airlines. Hospitals would get significant help as well.
Six days of arduous talks produced the bill, creating tensions among Congress’ top leaders, who each took care to tend to party politics as they maneuvered and battled over crafting the legislation. But failure was not an option.
“This is a proud moment for the United States Senate and the country, and we’re going to win this battle,” McConnell told reporters after the vote. “We’ve pivoted from impeachment to 100-to-nothing on this rescue package … this is about as flawless as you could possibly be.” The vote actually was 96-0 because several members missed the vote out of concerns they have been exposed to the virus.
The bill would provide one-time direct payments to Americans of $1,200 per adult making up to $75,000 a year and $2,400 to a married couple making up to $150,000, with $500 payments per child.
A huge cash infusion for hospitals expecting a flood of COVID-19 patients grew during the talks to an estimated $130 billion. Another $45 billion would fund additional relief through the Federal Emergency Management Agency for local response efforts and community services.
Democrats said the package would help replace the salaries of furloughed workers for four months, rather than the three months first proposed. Furloughed workers would get whatever amount a state usually provides for unemployment, plus a $600-per-week add-on, with gig workers like Uber drivers covered for the first time.
Businesses controlled by members of Congress and top administration officials, including Trump and his immediate family members, would be ineligible for the bill’s business assistance.
Schumer boasted of negotiating wins for transit systems, hospitals and cash-hungry state governments that were cemented after Democrats blocked the measure in votes held Sunday and Monday.
But New York Gov. Andrew Cuomo said the Senate package would send less than $4 billion to New York, far short of his estimate that the crisis will cost his state up to $15 billion over the next year. More than 280 New Yorkers have died from the virus, a death toll more than double that of any other state.
Still, Pelosi said the need for more money for New York is “no reason to stop the step we are taking.”
Pelosi was a force behind $400 million in grants to states to expand voting by mail and other steps that Democrats billed as making voting safer but Republican critics called political opportunism. The package also contains $15.5 billion more for a surge in demand for food stamps as part of a massive $330 billion title for agency operations.
State and local authorities would receive up to $150 billion in grants to fight the virus, care for their residents and provide basic services.
Republicans won inclusion of an employee retention tax credit that’s estimated to provide $50 billion to companies that retain employees on payroll and cover 50% of workers’ paycheck up to $10,000. Companies would also be able to defer payment of the 6.2% Social Security payroll tax.
For most people, the new coronavirus causes mild or moderate symptoms, such as fever and cough that clear up in two to three weeks. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia, or death.
In the United States, more than 69,000 people have been sickened and more than 1,000 have died.
Highlights of the virus relief package
Partial highlights of a roughly $2.2 trillion package to rush aid to businesses, workers and a health care system slammed by the coronavirus pandemic. The package, written by Trump administration officials and Democratic and Republican Senate leaders, was released late Wednesday night and unanimously approved by the Senate.
• Loans and guarantees to businesses, state and local governments: $500 billion. Includes up to $50 billion for passenger airlines, $8 billion for cargo carriers, $17 billion for “businesses critical to maintaining national security.” Companies accepting loans may not repurchase outstanding stock; must maintain their employment levels as of March 13, 2020 “to the extent practicable”; and bar raises for two years to executives earning over $425,000 annually. Companies are not eligible for loans if top administration officials, members of Congress or their families have 20% control.
• Small businesses: Includes $350 billion in loans for companies with 500 employees or fewer, including nonprofits, self-employed people and hotel and restaurant chains with no more than 500 workers per location. Government provides eight weeks of cash assistance through loans to cover payroll, rent and other expenses, much of which would be forgiven if the company retains workers. Also $17 billion to help small businesses repay existing loans; $10 billion for grants up to $10,000 for small businesses to pay operating costs.
• Emergency unemployment insurance: $260 billion. Includes extra 13 weeks of coverage for people who have exhausted existing benefits. Also covers part-time, self-employed, gig economy workers. Weekly benefit increase of up to $600.
• Health care: $150 billion. Includes $100 billion for grants to hospitals, public and nonprofit health organizations and Medicare and Medicaid suppliers.
• Aid to state and local governments: $150 billion, with at least $1.5 billion for smallest states.
• Direct payments to people: One-time payments of $1,200 per adult, $2,400 per couple, $500 per child. Amounts begin phasing out at $75,000 for individuals, $150,000 per couple.
• Tax breaks: Temporarily waives penalties for virus-related early withdrawals and eases required minimum annual disbursements from some retirement accounts; increases deductions for charitable contributions. Employers who pay furloughed workers can get tax credits for some of those payments. Postpones business payments of payroll taxes until 2021 or 2022.
• Department of Homeland Security: $45 billion for a disaster relief fund to reimburse state and local governments for medical response, community services, other safety measures. Extends federal deadline for people getting driver’s licenses with enhanced security features, called REAL ID, from Oct. 1, 2020, to Sept. 30, 2021.
• Education: $31 billion. Includes $13.5 billion for states to distribute to local schools and programs, $14 billion to help universities and colleges.
• Coronavirus treatments: $27 billion for research and development of vaccines and treatments, stockpiling medical supplies.
• Transportation: Includes $25 billion for public transit systems; $10 billion for publicly owned commercial airports, intended to sustain 430,000 transit jobs; $1 billion for Amtrak.
• Veterans: $20 billion, including $16 billion for treating veterans at VA facilities; $3 billion for temporary and mobile facilities.
• Food and agriculture: $15.5 billion for food stamps; $14 billion for supporting farm income and crop prices; $9.5 billion for specific producers including specialty crops, dairy and livestock; $8.8 billion child nutrition. Money for food banks, farmers’ markets.
• Defense: $10.5 billion for Defense Department, including $1.5 billion to nearly triple the 4,300 beds currently in military hospitals; $1.4 billion for states to deploy up to 20,000 members of National Guard for six months; $1 billion under Defense Production Act to help private industry boost production of medical gear. Money cannot be used to build President Donald Trump’s proposed wall along Mexican border.
• Social programs: Includes $3.5 billion in grants for child care and early education programs; $1 billion in grants to help communities address local economic problems; $900 million in heating, cooling aid for low-income families; $750 million for extra staffing for Head Start programs.
• Economic aid to communities: $5 billion in Community Development Block Grants to help state and local governments expand health facilities, child care centers, food banks and senior services; $4 billion in assistance for homeless people; $3 billion for low-income renters; $1.5 billion to help communities rebuild local industries including tourism, industry supply chains, business loans; $300 million for fishing industry.
• Native American communities: $2 billion for health care, equipment schools and other needs.
• Diplomacy: $1.1 billion, including $324 million to evacuate Americans and diplomats overseas; $350 million to help refugees; $258 million in international disaster aid; $88 million for the Peace Corps to evacuate its volunteers abroad.
• Elections: $400 million to help states prepare for 2020 elections with steps including expanded vote by mail, additional polling locations.
• Arts: $150 million for federal grants to state and local arts and humanities programs; $75 million for Corporation for Public Broadcasting; $25 million for Washington, D.C., Kennedy Center for the Performing Arts.
• Congress: $93 million, including $25 million for the House and $10 million for the smaller Senate for teleworking and other costs; $25 million for cleaning the Capitol and congressional office buildings.