Treasury Secretary Steven Mnuchin said Thursday that there is a “strong likelihood” that Congress will need to pass another coronavirus relief bill, though he said the additional stimulus won’t be needed right away.
“We’re going to carefully review the next few weeks,” Mnuchin said via video at an event hosted by The Hill. “I think there is a strong likelihood we will need another bill, but we just have $3 trillion we’re pumping into the economy and we’re going to step back for a few weeks and think very clearly how we need to spend more money and if we need to do that.”
Mnuchin’s comments come after a number of Senate Republicans, particularly those facing difficult reelection bids, indicated support this week for passing another coronavirus relief bill as soon as next month.
“Publicly and privately, Republicans are signaling that they believe the Senate will have to move beginning in June on another recovery package, calls that many believe will intensify next month after senators hear concerns about the deteriorating economy in their states during next week's Memorial Day recess,” CNN’s Manu Raju and Lauren Fox report. “And some are quietly urging President Donald Trump to get more involved.”
The president earlier this month said he was in “no rush” to negotiate another rescue package, and Senate Majority Leader Mitch McConnell has also argued that there’s no urgency to pass another bill, saying lawmakers need to take time to see how the nearly $3 trillion already provided is working. But Federal Reserve Chairman Jerome Powell warned lawmakers in recent days that the economy may need more support and that the pain from the pandemic could drag on for years, and McConnell may be sensitive to the entreaties of senators looking to hold onto their seats — and the GOP’s Senate majority.
What Some Senate Republicans Are Saying
- "I think June doesn't need to come and go without a phase four," Sen. Roger Wicker of Mississippi said. According to The Hill, Wicker said that “almost everybody” in the GOP conference “in their heart” wants to move ahead on another relief package next month, even if they aren’t publicly pressing for action.
- “Congress has a tremendous responsibility to help mitigate the impact of this crisis on our states and our local communities and on the families they serve,” Sen. Susan Collins of Maine said Wednesday. “We must not wait. We should act now.” Collins urged the Senate to start negotiating with the House and warned that “massive layoffs and huge reductions in services” could follow if states, cities and counties don’t get more aid.
- Sen. Cory Gardner of Colorado urged the Senate to stay in town instead of taking its Memorial Day recess. “It’s unfathomable that the Senate is set to go on recess without considering any additional #COVID19 assistance for the American people. Anyone who thinks now is the time to go on recess hasn’t been listening,” he tweeted. Gardner later told Politico he feels good about the progress made by senators working on changes that would give businesses more time to spend Paycheck Protection Program funds.
- “Optimistically, we might move before the Fourth of July,” said Sen. Roy Blunt of Missouri, “but I don’t know that we move that quick. I do think that we move on a phase four before the August break.” The break is scheduled to start August 8.
- Sen. Lindsey Graham is pushing Trump to pursue another infrastructure package, despite resistance from Senate Majority Leader Mitch McConnell. "I want to do infrastructure," Graham told CNN. "I told Trump, this is the time. We got it teed up. This is the time to go big. ... It really is a once-in-a-lifetime opportunity to give a facelift to the country." Blunt and Wicker reportedly also want an infrastructure package. “Personally, I’d like to see infrastructure,” Blunt said, according to The Hill. “If we’re going to have to spend money to reignite the economy, I’d prefer to spend it on something that has long-term benefit.”
GOP may have a hard time reaching consensus: Republicans face some significant internal divisions that may make it difficult to agree on the size and scope of any additional aid. Some want to hold off and warn that there may not be a need to spend more. Others reportedly want narrow tweaks to existing programs. Still others aim to provide a larger, more ambitious package.
“Republicans have been debating ideas, including giving unemployed workers a bonus for returning to companies that reopen, giving small business owners more flexibility on how they handle forgivable loans under the Paycheck Protection Program, providing states and cities more leeway in how they spend $150 billion that's been already approved or whether to give those governments and other distressed industries another massive bailout from Washington,” CNN’s Raju and Fox report.
Pelosi says “it’s just a matter of time”: House Democrats last week passed a $3 trillion relief bill, but Senate Republicans said that legislation was dead on arrival, dismissing it as a “liberal wish list.” House Speaker Nancy Pelosi told Bloomberg TV Thursday that “it’s just a matter of time” before the Senate takes up another package. “I’m optimistic,” she said, “because the American people fully support what we are doing and oppose the Senate obstructing it.”
The bottom line: Another relief package is likely. Michael Pearce, senior U.S. economist at Capital Economics, suggests in a new note to clients that a compromise is likely “because Republicans won’t want to undermine the recovery in an election year and because they need Democrat support to pass a bill limiting legal liability for coronavirus-related claims” against hospitals and businesses. “Overall, it seems likely that the next fiscal package will measure in the billions rather than trillions,” Pearce writes, suggesting that wouldn’t make a huge difference to the economy. “We doubt a substantially larger package would be agreed unless there was a damaging second wave of the virus later this year, in which case the deficit could rise by an additional 10-20 percentage points.”