Coronavirus Rescue Plan in Limbo
We may be in a national crisis but it's still politics as usual in Washington.
There is near-universal agreement that a massive stimulus and relief package is essential to save the economy and ensure people who can’t work during the COVID-19 shutdown can meet basic expenses. Alas, Democrats and Republicans have very different ideas as to what it should look like.
Democrats are taking the brunt of the blame.
NYT (“Emergency Economic Rescue Plan in Limbo as Democrats Block Action“):
Senate Democrats on Sunday blocked action on an emerging deal to prop up an economy devastated by the coronavirus pandemic, paralyzing the progress of a nearly $2 trillion government rescue package they said failed to adequately protect workers or impose strict enough restrictions on bailed-out businesses.
The party-line vote was a stunning setback after three days of fast-paced negotiations between senators and administration officials to reach a bipartisan compromise on legislation that is expected to be the largest economic stimulus package in American history — now expected to cost $1.8 trillion or more. In a 47-to-47 vote, the Senate fell short of the 60 votes that would have been needed to advance the measure, even as talks continued behind the scenes between Democrats and the White House to salvage a compromise.
The failure to move forward shook financial markets and threatened an ambitious timeline set by the Trump administration and leading Republicans to move the rescue package through the Senate on Monday and enact it within days.
In voting to block action, Democrats risked a political backlash if they are seen as obstructing progress on a measure that is widely regarded as crucial to aid desperate Americans and prop up a flagging economy. But they argued the vote on Sunday was premature given their remaining reservations about the measure, while Republicans heaped criticism on them for creating uncertainty for both the public and the markets.
WaPo (“Senate falls far short of votes needed to advance coronavirus bill as clash between Republicans and Democrats intensifies“):
Senate Democrats blocked a massive coronavirus stimulus bill from moving forward Sunday as partisan disputes raged over the legislation that’s aimed at arresting the economy’s precipitous decline.
Lawmakers had hoped to pass the enormous $1.8 trillion bill by Monday but Sunday night they were scrambling to revive talks, with the stock market poised for another sharp drop and households and businesses fretting about an uncertain future.
Negotiations continued even as the initial procedural vote fell short, with 47 senators voting in favor and 47 opposed. The tally was well short of the 60 votes that were needed to move forward. The number of “aye” votes was especially low because five Republicans are quarantined over coronavirus fears.
Although senators of both parties and Trump administration officials vowed to continue negotiating — around the clock if necessary — the failed vote was the latest negative signal about Congress’ ability to come together around the legislation, which aims to inject close to $1.8 trillion into businesses and households. Policymakers are scrambling to address a spike in layoffs and businesses gasping for assistance as millions of Americans stay home to avoid contagion.
Ever since Majority Leader Mitch McConnell (R-Ky.) introduced the legislation Thursday night, senators have missed one self-imposed deadline after another to reach a deal. The vote Sunday evening was delayed three hours so talks could continue after it became clear it would fail, but no resolution was reached and it failed anyway. McConnell set another procedural vote for 9:45 Monday morning and dared Democrats to block it, noting repeatedly that the vote would come shortly after the opening of the stock market.
WSJ (“Republican Coronavirus Rescue Package Fails Procedural Hurdle in Senate“):
Senate Democrats blocked a rescue package designed to blunt the economic impact of the coronavirus pandemic, after a dispute with Republicans over corporate bailout provisions and aid to dislocated workers.
POLITICO (“Coronavirus rescue package in limbo“):
IF YOU WERE COUNTING ON WASHINGTON to come together quickly and without drama to combat the coronavirus, you haven’t been reading Playbook, and you’ve probably been ignoring reality.
THE SENATE failed to clear a key procedural hurdle tonight on the massive $1.6-trillion coronavirus package, a major blow to the government’s efforts to immediately inject money into the economy during this global health crisis.
SENATE MINORITY LEADER CHUCK SCHUMER (N.Y.) held the entire Democratic caucus against the measure after two days of marathon negotiations. The motion failed, 47-47.REPUBLICANS are calling the Democrats’ efforts irresponsible — they blamed Speaker NANCY PELOSI. Democrats say Senate Majority Leader MITCH MCCONNELL (R-Ky.) didn’t accede to their demands.
THE MAIN ISSUE , according to Democrats, is a $500-billion “slush fund” that is aimed at helping companies that have suffered due to the economic slowdown . Democrats say it has little oversight and does not help workers. They also say Treasury Secretary STEVE MNUCHIN would have too much influence over the disbursement of the money with insufficient oversight.
THE TWO SIDES are still in negotiations over the bill, and McConnell and Schumer say they could yet reach a deal tonight. [They didn’t. -ed.]
DEMOCRATS – SCHUMER and PELOSI – believe they now have tremendous leverage to change the package. Negotiations will continue, of course. But if they don’t make discernable progress before the U.S. stock exchange opens tomorrow, they could be in for a very tumultuous day. Treasury Secretary STEVEN MNUCHIN was the first person to throw out Monday as the deadline for this package’s passage.
The process here is truly bizarre, even for our hyper-partisan, hyper-polarized atmosphere.
It simply makes no sense for McConnell, who leads the far-harder-to-manage half of our bicameral legislature, to be going alone on this. He needs 60 votes (more on that shortly) to get anything through, which means he needs some Democrats on board. Why not work with Schumer at the outset to get a bill out with the provisions that have broad support?
For that matter, since any bill is going to have to pass through the Democratic-majority House, why not get Pelosi and other House leaders in on the negotiations at the outset?
This shouldn’t be normal order, politics-as-usual. Congress needs to act now, so we don’t have weeks to waste with the normal back-and-forth nonsense.
And why on earth are we still pretending that a 60-vote supermajority is required to pass bills through the Senate? That’s the threshold for invoking cloture during a filibuster. Nobody, to my knowledge, is filibustering this bill.
As to the merits, I tend to agree with Schumer that “unemployment insurance on steroids” should be the main focus. Given how much power the Fed has to loan massive amounts of money to failing corporations, the need for a “slush fund” controlled by the Treasury is unclear.
Oh, it’s clear all right.
McConnell: Continuing to extract every advantage for the standard GOP agenda even if it kills us.
The headlines belie it, but this problem was caused by Moscow Mitch.
While it seems that Tiny’s binary brain believes the cure is worse than the disease.
We’re all Italians now.
Kevin Drum has done the “remarkably difficult” job of digging out the main pieces of the bill to produce a table of the main provisions, which shows priorities almost exactly reversed from what we should be doing.
So Republicans are aiming the money hose at their friends and have to have their arms twisted to provide relief to the medical system and the unemployed. And the supposedly liberal MSM are lazily reporting that there’s a relief bill, and Democrats are blocking the relief bill.
Remember, all of one caucus plus one Senator from the majority caucus is on the record saying that Trump is an extortioneer, grifter and conman. From this strong prior, it is very reasonable for them to all want extremely strong safeguards on any funds that have implementation discretion.
James, it’s clear that a bunch of cranky old men in their 60’s and 70’s, who’ve succeeded by rampant and gross corruption can’t change their ways even when the hurricane is visible and audible.
This is a good time to point out that the Senate poorly represents the population. And, indeed, the current majority party does not represent the majority of the country in terms of actual people.
That kind of situation will skew the outcomes
(And this is also a good example of how this structure does not create any kind of special “small state” representation, insofar as corporate bailouts are not the best way to help rural or small state citizens).
There”s a difference between loan, and give.
Everything you need to know about why McConnell is doing what he’s doing in one sentence.
@Michael Cain: Given that James said “loan” I’m failing to see your point, which I assume is something about the 500 billion in large business loans being recoverable, at least in theory.
However it is a good opening to mention that other countries are offering bridge loans, forgivable if used to retain employees. Seems a much better plan.
@Scott F.: Also everything you need to know about the (multiple expletives deleted) supposedly liberal MSM.
The messaging on this writes itself: The Trump administration, under guise of a relief bill, is instead proposing to spend trillions of taxpayer dollars to line the pockets of their donors and cronies without actually addressing the financial hardships the pandemic is causing. Democrats are holding out for a relief bill that actually relieves, rather than rubber-stamping corruption just to appear to be doing something.
Don’t hold your breath.
Also, the Treasury Secretary can keep the details of who is getting the bailouts secret for six months, so he can sit on it a few weeks and then give it away in ways that won’t be known to the public until after the election.
The Republicans made lot’s of promises for their Tax Cut to the rich and corporations, and none of them came to fruition. They spent all the money on stock buybacks. None on employees, or expanding. The idea that we should now give them more money, unrestricted, is laughable. The idea that we should let Trump, who has been forbidden from running a charity because of his corruption, administrate the money is hilarious.
The other thing to remember is that worst hit areas are in Blue States. Moscow Mitch doesn’t give a fuq.
@Daryl and his brother Darryl: Which is really stupid because per capita, the Blue States contain the bulk of the business engines for the economy.
Trump is petty enough to be willing to watch NYC fall because he wasn’t accepted into the upper crust, unfortunately. What’s surprising me that the rest of the Republicans are still going along with him–how do they think that THEY will survive if the largest cities of the U.S. go to pot?!
@Steven L. Taylor:
Love that you get a downvote for explaining something that has an unassailable factual basis.
Some people just don’t want to accept reality if it looks bad for their party or ideology. Or, more likely, if it challenges whether they deserve what they have in life.
@grumpy realist:
Right, that’s the irony of the current political situation–rural voters bitch and moan about “their” tax dollars going to other people despite their lifestyle being subsidized by others.
@grumpy realist: How will they survive? They haven’t thought beyond getting reelected. And they’re sticking to their stock plan, do enough favors for donors and lobbyists to get enough donations to buy reelection. Their only hope now is the perception of enough of disease and economic recovery third quarter to allow them to declare victory. They should be backing all measures to support the health care establishment and to direct purchasing power to people who need it and will spend it quickly. But they seem locked in habit and ideology.
@Kurtz: The awesomeness of the Senate is an article of religious faith with many.
Kevin Drum says there is no way the bill will pass with the slush fund in it and I agree. Pelosi picked the right hill to die on as she digs in and says no to handing President Trump a blank check to get revenge against his enemies (aka CA and NY) and build his wall, as it would be beyond dumb to hand over such a check to this President’s hands.
If she did that all the Democrats in the House and Senate should just resign and let the Republicans take over the country because if this is not a hill to die on I don’t know what is.
Republicans have spent so much energy and effort trashing Pelosi over the past few years (heck, over the past decade or more) that this moment in time is when it will come to bite them in the tuckus. She has been insulted by the President and so many folks with an R before their name too many times to count so what are a few more insults, bricks and barbs thrown her way today.
The Republican Party has cried wolf one too many times about Pelosi being the meanie who never lets the saintly Republican Party do the work that America elected them for. McConnell is trying to say to people look, no look over there, she is hurting America when most folks are saying to themselves dude, you ALWAYS think she is plotting to bring down America so what is so different today?
The R’s could clear this up right quick and pass the bill today/early tomorrow if they simply agreed to erect some oversight committees regarding the 500 Billion that is not currently earmarked for anything specific but that they are not even willing to consider this really is a damning indictment of the modern Republican Party. They should want there to be lots, and I mean lots…like tons of oversight to keep track of where and how such an immense amount of money is being spent.
Far be it from Republicans to not use this crisis to reward their friends, relatives, and political donors…for them to do otherwise would be incompetent and gross malpractice…
I walk into the grocery store and many shelves are still empty: bread, cereal, peanut butter, milk, eggs, towels, soap, and most meats. There is food if you want to eat Easter candies, Doritos. ice cream, Fritos, and Kit-Kat bars. Well, they did have plenty of protein shakes and bars.
How can someone possible use ten gallons of milk?
Panic buying! There needs to be some rules about that.
Farmers are going out of business. Is that also causing these shortages?
The good news is that once we’ve gotten the Senate version fixed, we can take on the House version, which is just as bad.
The course here has been clear for a while: write checks to everyone, sort it out in next year’s tax returns. And these dopes can even do that.
@Hal_10000: What is your issue with the House version?
I just want to add one more thing, remember Solyndra? That was a 500 million (with an M, not a B) earmark that went belly-up and the way Republicans complained about it you would have thought the world was ending because the Obama admin made an investment that did not work.
They made so much hay out of Solyndra and now they want to give their guy the freedom to screw CA and NY, build his wall, and shore up all his businesses with no oversight at all, wow….we need to invent another word because chutzpah does not do justice to how quickly Republicans are willing to dole out Billions to folks they care about and not care if the tax payers get a good ROI out of bailing out their pet companies.
@An Interested Party:
It’s 1400 pages and loaded with various unrelated provisions. Provisions on global warming, collective bargaining, student loan forgiveness, its on $150 billion slush fund, corporate board diversity, minimum age. These might be fine issues, but they have no business in this bill.
@An Interested Party: if I recall correctly the Senate version had some abstinence only requirements in there.
@Hal_10000:
Fair enough, here is a compromise our side (I lean Democratic/Liberal) takes out the 150 Billion slush fund and the Republicans take out their 500 Billion(!) slush fund…cool?
@Teve: Abstinence doesn’t work with teens and it sure as hell isn’t going to work with corporations…
It’s interesting who the two sides want to help…Republicans want to help corporations, fat cats, and others who are supposedly suffering and Democrats want to help workers, hospitals, people with student loans, and people who make the minimum wage…quite the contrast…
@Tyrell:
At least at the Kroger chain grocery near me this morning, you could go to the produce section and never know there was a problem. All the fruits and vegetables stocked to overflowing. Well, except for bananas, but that can be attributed to all the school kids stuck at home, I suppose.
Milk stores in the freezer. Look it up. And remember two things: 1) these people are engaging in panic buying and 2) they don’t care about what you don’t have; they only care about what they do have. (It’s what makes America great, you know.)
ETA: I was just at the store today (8:30 am), and did fine. I bought bananas, cauliflower, romaine, some cheese, a package of brown and serve sausage, oranges, and some cereal. I guess we don’t panic as much or as long here.
ETA: Oh, and a gallon of 1% milk. I had to settle for skim last week 🙁
@An Interested Party:
I would absolutely support that. The best pill they could pass right now:
1) Send $1000 (or thereabouts) to every American regardless of income
2) Commit to doing so for the next two months or however long it takes us to get on top of this, whichever is shorter.
3) Claw it back from high earners in their next tax return (or let them donate it, 100% tax free, to charity).
I’d then maybe have a separate bill extending interest-free lines of credit to distressed businesses (not cruise lines).
Something along those lines could have been done a week ago.
There’s a case for bailing out companies that employ a lot of people and that provide a valuable service or product. But there’s also a big distaste right now to bail out the rich owners and top executives as well.
Consider the airlines, that’s an industry I read about most. In 2017, American’s CEO said American would never again lose money. Granted I didn’t see a pandemic coming, but my first though was “Oh? He’s going to close down the airline?” Because that’s the only sure way for a company to never lose money.
Airlines are hard to like. On the one hand, fares are the lowest they’ve ever been, but fees are high and there are a lot more of them than they used to be. And that’s what people see, like nag fees and seat fees. Others pass mostly unnoticed, like fuel surcharges.
So who wants to spend billions of tax payer money to keep American, United, Jet Blue, or even Southwest in the black? Airlines typically keep operating during bankruptcy. Why not bail them out when they go broke and they’re still flying? Or how to bail the companies out without rewarding the owners and executives for poor planning?
@Kathy: Bail the companies out. Wipe out the share equity and all debt/equity not owed to employees. Then go public again.
@Just nutha ignint cracker: I have frozen and then thawed whole milk but it changed the texture to an unpleasant graininess. I’ve heard that people fix that by throwing it in a blender, but I haven’t tried that yet.
@Teve: I’ve heard that about whole milk, too, but I don’t drink whole milk, so I don’t know. People who are panicking won’t care.
Besides, they can throw it out after their panic is over. It’s about having, not needing. The waste is immaterial.
This seems like a much better way to bail out companies…well, if the point is to take care of their employees, that is, rather than having a slush fund to help rich Republicans…
@Hal_10000: Oh look it’s the standard Republican talking point about pages OMG THERE’S SO MANY PAGES IT HAS TO BE BAD!!!
I cannot find provisions on global warming in the bill. Could you point me towards them?
Student loans don’t care that the economy cratered and you don’t have a job. You gotta pay up regardless and the forgiveness as you call it is there to stop that. You have to meet specific requirements for short term forgiveness.
Where is this $150 billion slush fund?
Corporate board diversity what the hell? Where’s that in the bill?
Minimum age what???
HEre I’ll help you out and provide a direct link.
https://apps.npr.org/documents/document.html?id=6817883-FINAL-HOUSE-BILL
Meanwhile here’s the bill the senate has been voting on.
https://www.congress.gov/bill/116th-congress/house-bill/748