With Democrats and Republicans unable to agree on a second round of stimulus, Senate Republicans introduced the Delivering Immediate Relief to America’s Families, Schools and Small Businesses Act. As expected, the targeted stimulus package offers about $500 billion in Covid-19 relief. A vote on the bill is set for this Thursday.
At about $500 billion, the bill offers half the financial aid of the HEALS Act Senate Republicans introduced at the end of July. It’s also substantially less than the $1.3 trillion Republicans offered during negotiations with the Democrats over another round of stimulus. All of this raises the question as to why Senate Republicans appear to be backtracking from previous proposals.
We’ll get to that question, but first, let’s look at what’s in the new stimulus bill.
What’s in the New Stimulus Bill
The scaled back Covid-19 relief bill includes $300 a week in extra unemployment benefits through the end of the year. It includes $105 billion for schools, $10 billion for the Postal Service, and $258 billion for the Paycheck Protection Program. The bill also includes limited liability for employers related to Covid-19 lawsuits and $47 billion for vaccines and testing.
Significantly, the new bill does not include a second stimulus check.
Why Have Senate Republicans Introduced this Stimulus Package Now
There are several issues at play here. House Democrats passed the $3.4 trillion Heroes Act back in May. Although Senate Republicans introduced the $1 trillion HEALS Act in July, it hasn’t been put to a vote. There is a practical reason for this. The Senate cloture rule (think filibuster) generally requires 60 votes to end debate on a bill and send it to the floor for a vote. Without bipartisan support, which the HEALS Act doesn’t have, a vote is impossible.
The new stimulus bill doesn’t have bipartisan support either. As such, 60 votes on Thursday is out of the question. Senate Republicans, however, are hoping for at least 51 Republican votes. While that won’t bring the bill up for a vote, it will give vulnerable Senate Republicans up for reelection this November some ammunition against their opponents. It also may put more pressure on the Democrats to come back to the negotiating table (more about this in a moment).
At the same time, Republicans have been willing to pass another round of stimulus on those issues that do have bipartisan support. Senator Majority Leader Mitch McConnell (R-KY) said on the Senate floor that they “want to agree where bipartisan agreement is possible — get more help out the door and then keep arguing over the rest later.” So far, however, Democrats have been unwilling to take this approach.
Is the Stimulus Bill ‘Fraudulent’
House Speaker Nancy Pelosi (D-CA) and Senate Minority Leader Chuck Schumer (D-CA) immediately attacked the bill. Speaker Pelosi called it “fraudulent.” In a joint statement Pelosi and Schumer said, “This emaciated bill is only intended to help vulnerable Republican Senators by giving them a ‘check-the-box’ vote to maintain the appearance that they’re not held hostage by their extreme right-wing that doesn’t want to spend a nickel to help people.”
It’s certainly true that the new stimulus bill is unlikely to become law. Of course, the same can be said of the Heroes Act and Postal Service bills passed by House Democrats.
Are Republicans Backtracking From Stimulus Negotiations
The bigger question is why Republicans have introduced a $500 billion stimulus bill when they had offered Democrats a $1.3 trillion deal. Some Senate Republicans, concerned with the growing national debt, are unwilling to support a $1.3 trillion stimulus package. In fact, some may be unwilling to support a package of any size given that nearly $2.5 trillion in relief has already been authorized in the CARES Act and other legislation.
The goal of the new stimulus package is to get as many Republican votes as possible. As noted earlier, this may put pressure on Democrats and can give Republicans something to show their constituents. This package, however, is unlikely to change stimulus negotiations.
If Democrats and Republicans resume negotiations and reach a deal, it can pass both the House and the Senate on a bipartisan basis. It may not get the support of a number of Senate Republicans, but it won’t need their support to pass.
Two Approaches on the Next Stimulus
What the new stimulus bill really does is shine a light on how each party is approaching negotiations. The Democrats are taking a “go big or go home approach.” While they have come down from their $3.4 trillion Heroes Act, they are still at $2.2 trillion. While both sides agree on a number of relief provisions, such as stimulus checks, unemployment benefits, and education aid, Democrats are refusing to move forward on these provisions until Republicans agree to their other priorities.
It’s a big gamble. While Democrats hold out for a $2.2 trillion package, many Americans and small businesses are suffering. The tactic is all the more risky given that Democrats want $915 billion for state and local governments, an amount that far exceeds the actual budget shortfalls. They also are demanding $600 in unemployment benefits, even though this amount would pay individuals more to stay home than they made working.
For Republicans, they want to pass a bill on those issues where agreement can be reached. Mr. McConnell expressed this viewpoint in a statement released earlier today: “Today, the Senate Republican majority is introducing a new targeted proposal, focused on some of the very most urgent healthcare, education, and economic issues. It does not contain every idea our party likes. I am confident Democrats will feel the same. Yet Republicans believe the many serious differences between our two parties should not stand in the way of agreeing where we can agree and making law that helps our nation.”
This approach has its own risks. With the November election fast approaching, a stalemate in Washington could hurt the chances of vulnerable Senate Republicans and possibly the President. Indeed, it may be this very fact that explains, in part, why Speaker Pelosi and Sen. Schumer are unwilling to move forward on those elements of a stimulus bill where both sides agree.
At this point the question is what might bring the two sides back to the negotiating table. An improving economy and falling unemployment rate might move Democrats to lower their demands. These very factors, along with a growing national debt, may keep Republicans from moving beyond their current position.
You can read the full text of the new stimulus bill here.
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