A $2 trillion aid package to ease the economic damage wrought by COVID-19 is nearing the finish line in Washington, D.C.
The White House reached a deal with Senate leaders of both parties early Wednesday morning on the legislation, which provides financial assistance to workers businesses and the healthcare system. As of press time late Wednesday afternoon, the Senate was expected to approve the bill at some point in the day.
In the House, Rep. Neal Dunn, a Panama City-based Republican whose constituency includes a majority of Columbia County’s population, expects to take up the massive, unprecedented emergency measure either today or Friday.
“This is one of those things where speed actually counts,” Dunn said. “The quicker you get it out to folks, the better off they are.”
The pandemic response package would be the largest economic rescue legislation in the country’s history. A prominent piece of the measure gives a direct one-time payment of $1,200 per adult and $500 per child directly to the public.
“Everyone wants to talk about the free money,” Dunn said. “That’s a strictly Democrat provision.”
A majority of Americans would receive the payment under the terms of the bipartisan bill, forged through five days of heated negotiations on Capitol Hill. Dunn opposed giving cash directly to individuals.
“But that’s part of the compromise,” he said.
The measure would expand unemployment benefits and provide a $367 billion program for small businesses to keep making payroll while workers are forced to stay home.
“This is a really generous bill for small businesses,” Dunn said.
Republicans won inclusion of an “employee retention” tax credit that’s estimated to provide $50 billion to companies who retain employees on payroll and cover 50% of workers’ paychecks.
“If you dump employees, you’re not eligible for these programs,” Dunn said. “In many ways, this is a great way to get the economy jump-started again.”
Companies would also be able to defer payment of the 6.2% Social Security payroll tax.
“That is a virtuous way to do this,” Dunn said. “It’s their own tax dollars.”
Most of the “big-ticket” programs are loans rather than grants, Dunn said.
“We didn’t want to have a bailout of everybody and their brother,” he said.
One of the last issues during negotiations between the Senate and White House concerned $500 billion for guaranteed, subsidized loans to larger industries, including a fight over how generous to be with the airlines. Hospitals would get significant help as well.
“After days of intense discussions, the Senate has reached a bipartisan agreement on a historic relief package for this pandemic,” said Majority Leader Mitch McConnell, R-Ky., a key negotiator. “It will rush new resources onto the front lines of our nation’s health care fight. And it will inject trillions of dollars of cash into the economy as fast as possible to help Americans workers, families, small businesses and industries make it through this disruption and emerge on the other side ready to soar.”
Large businesses seeking assistance will have to meet certain conditions, Dunn said.
“Big companies can get help, but they’re going to need to come to the table and they have to keep their employees,” he said.
During negotiations, Democrats secured gains for hospitals, additional oversight of the huge industry stabilization fund, and money for cash-strapped states. A companion appropriations package ballooned as well, growing from a $46 billion White House proposal to more than $300 billion, which dwarfs earlier disasters — including Hurricane Katrina and Superstorm Sandy combined.
To provide transparency, the package is expected to create a new inspector general and oversight board for the corporate dollars, much as was done during the 2008 Troubled Asset Relief Program bank rescue, officials said.
A huge cash infusion for hospitals expecting a flood of COVID-19 patients grew during the talks at the insistence of Sen. Chuck Schumer, the Democratic leader, while Republicans pressed for tens of billions of dollars for additional relief to be delivered through the Federal Emergency Management Agency, the lead federal disaster agency.
Democrats said the package would help replace the salary 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.
“It ensures that all workers are protected whether they work for businesses small, medium or large, along with self-employed and workers in the gig economy,” Schumer said.
The rescue package would be larger than the 2008 bank bailout and 2009 recovery act combined.
The $2 trillion price tag sounds staggering. But with a large portion of the economy shut down, Dunn said the “carefully crafted” measure is necessary to prevent a recession or worse.
“It’s going to take a shock to the system to do that,” he said.