Monday, negotiators from the White House and the House of Representatives continued weeks of meetings to come to an agreement on COVID relief for families, workers, and businesses ahead of rapidly approaching deadlines from the initial CARES Act, passed in March, including expiration of eviction protections and unemployment benefits.
Representatives of the Trump Administration, led by Secretary of the Treasury Steven Mnuchin, met with those of the House Democrats, led by Speaker Nancy Pelosi. Both sides have proposed bills to handle the raging COVID pandemic as it ravages the United States, but striking a compromise has been nearly impossible as the recess of Congress approaches, set for this Friday, August 7.
On May 15, the House of Representatives passed legislation proposed by Rep. Nina Lowery (D-NY) entitled the HEROES Act. The bill, if adopted by the Senate and President Trump, would be the largest economic stimulus in American history, surpassing the CARES Act’s $2.2 trillion with a staggering $3 trillion in new spending. The HEROES Act proposes an additional $1,200 in direct payments to Americans and the maintenance of $600 additional unemployment benefits and includes many provisions that extend beyond those in the CARES Act, passed in March. These include increasing the direct payment for additional dependents to $1,200 (was $500), expanding eligibility for the Paycheck Protection Program, extending a moratorium on evictions to nearly all properties for 12 months, providing $100 billion in rental assistance to families, and providing $100 billion for schools. Labeled dead on arrival by the Senate and President Trump, the HEROES Act has not been considered by the Senate, where Republicans see it as too much spending, despite rising case numbers in the United States.
Last week, on July 27, Senate Republicans finally unveiled their counter-proposal, the $1 trillion HEALS Act. The bill, while providing a second round of $1,200 stimulus checks, has many distinctions from both the CARES Act and HEROES Act, including providing $500 in stimulus payments for dependents, allocating only $200 additional unemployment benefits (this may be replaced by an amount not exceeding $500 in September), permitting bonuses of up to $450 for employees who chose to return to work after being laid-off or fired, shielding businesses, schools, and hospitals from lawsuits related to COVID for five years, appropriating $70 billion for K-12 schools (given classes are taught in-person) and allowing businesses to make second withdrawals from the Paycheck Protection Program, which many large corporations drew from earlier this year, despite the PPP being intended for small businesses.
In short, the Senate proposal prioritizes slashing spending while encouraging returns to work and schooling. These prerequisites are widely seen as nonstarters for House Democrats, and the slimmed-down $1 trillion in spending is still seen as too much by some prominent Republicans (Sens. Paul, Johnson, Cruz), and so the HEALS Act is unlikely to become law. Therefore, House Democrats and the White House have engaged in talks to produce a bill capable of passing Congress and being signed by President Trump, but they do not have much time.
Congress is set to enter recess this Friday. A potential 6.7 million face evictions as federal protections expire August 24 (CNBC). Fifty-one million Americans newly unemployed since the beginning of the pandemic face deep hardship as the $600 unemployment benefits increase expired July 31 (Forbes). Small businesses across America are potentially doomed as PPP expires on August 8. Furthermore, a record-shattering GDP loss of 33% from April to June 2020 reflects the worst economic conditions in nearly a century (Bureau of Economic Analysis). Lastly, Johns Hopkins University reports that, as of 12:30 PM EDT August 3, 2020, 4.7 million Americans have contracted COVID, with 155,000 deaths, and 1.9 million cases in the last month alone. So what’s the holdup?
FOX News reports that Sec. Mnuchin is defending the multi-month Republican delay in a COVID relief package, saying on ABC’s This Week, “there’s obviously a need to support workers, support the economy… on the other hand, we have to be careful about not piling on enormous amounts of debt.” Mnuchin paints the battle for a compromise COVID relief bill as a struggle between helping people as soon as possible and protecting Americans from an inflated debt.
Even before the HEALS Act was proposed, the national debt sat at roughly $25 trillion, as it has been increasing steadily since the early 2000s. Thus far in FY 2020, there has been a federal budget deficit of $2.7 trillion, outpacing the $2.0 trillion from the same period of time in FY 2019, during which time COVID was not a visible threat (Congressional Budget Office).
As businesses and schools across the country reopen, cases in many states are still going in the wrong direction, with fears of economic depression, social unease, and viral morbidity continuing well into 2021 permeating into American life and paralyzing every family in the United States with deep fears. As federal protections against unpreventable evictions and unemployment are set to soon cease, and as more Americans have died of COVID than were killed in action fighting for the United States in the Civil War, the federal government maintains a responsibility to its constituents to protect them from harm. House Democrats have adopted a proposal which progressives see as too little and which conservatives see as too much, while Senate Republicans have suggested slashing benefits for laid-off workers in an attempt to reopen the economy and schools as cases soar. Time is of the essence, and time is against any COVID relief package becoming law prior to this Friday, meaning a delay through a congressional recess that lasts until September 8. Only time will tell what Congress and the Trump Administration will do to combat the COVID pandemic, but one thing is certain- many Americans will be without income or shelter before relief arrives, whenever that may be.
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