No More $1,200 Stimulus Checks?

By Yuval Rosenberg

Nearly 70% of Coronavirus Relief Funds Have Been Spent or
Committed

Congress has provided roughly $1.6 trillion in direct
payments to assist individuals, businesses, hospitals, states and
municipalities struggling during the coronavirus pandemic, and
about 70% of the funds have already been distributed or committed,
according to an
analysis by The Wall Street Journal.

The money includes $1.2 trillion allocated in March by the CARES
Act, which has provided enhanced benefits for unemployed workers,
forgivable loans for small businesses and direct cash payments for
households, hospitals, cities and states. In April, Congress added
another $400 billion in aid for small businesses and hospitals.

“This fiscal stimulus has spent out very quickly relative to
reasonable expectations, certainly relative to historical
expectations, which is to the credit of the administration,” Ernie
Tedeschi, an economist with Evercore ISI who served in the Obama
Treasury Department, told the Journal. “In terms of the core
assistance to households and businesses, we’re already past the
peak.”

Here’s the Journal’s tally of major coronavirus relief
programs:

  • Paycheck Protection Program: The program providing
    forgivable loans to small business has disbursed or committed $511
    billion out of $670 billion as of May 30.
  • Economic Impact Payments: The Internal Revenue
    Service has sent $258 billion in direct payments to households, or
    about 89% of the expected 2020 total. About $35 billion in payments
    remain.
  • Coronavirus Relief Fund: As of May 20, the
    Treasury had disbursed $144.3 billion out of $150 billion provided
    for states, territories and tribal governments

Hospitals still waiting for help: One pot of money that
notably hasn’t been spent down is the $175 billion provided to help
hospitals and health care providers. The Journal reports that only
$46 billion has been disbursed. A report by
Politico notes that the Department of Health and
Human Services says it has allocated about $77 billion of the
total, leaving nearly $100 billion held up by uncertainty over how
best to distribute the funds. “The delay has prompted complaints by
both Democrats and Republicans on Capitol Hill, and left the
nation’s safety net hospitals and clinics with relatively little
federal support during a pandemic that’s simultaneously thrust them
onto the front lines and decimated their finances,” Politico’s Adam
Cancryn writes.

Individual payments stand out: Economists generally agree
that the stimulus payments for individuals and enhanced
unemployment benefits have had a powerful effect on the economy,
since they helped keep households afloat in recent weeks. The
question now is just how much more Congress should provide to keep
those households going – and the answer depends on a range of
issues, including the pace of the economic recovery, the spread of
the disease over the next few months, the prospects for vaccines
and treatments, and lawmakers’ willingness to keep running up the
deficit.

More money in other pipelines:
Congress has provided roughly $3.3 trillion in economic aid
overall, and much of the business-focused assistance has yet to be
spent. Treasury has $500 billion to spend backing up emergency
loans through the Federal Reserve, a program that hasn’t yet begun.
And Health and Human Services has been granted $330 billion for
disease research, which it can spend over the next year and a
half.

No More $1,200 Relief Checks, Say Republicans

Democrats in the House are pushing for another massive
relief bill with more than $3 trillion in additional spending, but
Republicans have called for a pause to give lawmakers a chance to
evaluate the strength of the economy and the effectiveness of the
money provided so far. And GOP leaders are increasingly expressing
doubts about the need to provide another round of $1,200 stimulus
payments.

Sen. James Lankford (R-OK) said Tuesday that the CARES Act
was necessary and effective, but the situation has changed. “Most
folks are very grateful for the help,” he said. “But I don’t think
we should set up a situation where we’re doing a check month after
month after month.”

Sen. Mitt Romney (R-UT) said that another round of direct
stimulus checks is “unlikely,” not least due to growing concerns
about their cost. “I think it’s important for us to consider how
we’re going to pay for all this and specifically how we’re going to
deal with the structural deficit we have that adds a trillion to
the debt every year. I hope that’s part of the next package,” he
said.

Some Democrats in the Senate have also expressed doubts
about sending out more stimulus checks, preferring instead to focus
on employment and institutions.

“My concern is that it’s not focused in a way that is
designed to help create or help sustain jobs, to deal with rental
housing or education,” said Sen. Christopher Coons (D-DE). “My top
priority is a robust round of assistance to state and local
governments.”

What’s next: Legislation is unlikely to pass before
July. White House advisers are scheduled to
meet this week to discuss their plans for the next
coronavirus package, which is expected to focus on promoting a
national return to work and normal life as quickly as
possible.

Ideas that have been discussed include a continuation of
enhanced unemployment benefits but at a lower level; federal
support for worker’s salaries; tax breaks for Americans who take
vacations domestically; a payroll-tax holiday; and a capital-gains
tax cut for investors.

Divided Senate Confirms Trump-Appointed Coronavirus Relief
Watchdog

The Senate voted along largely partisan Tuesday lines to
confirm a White House lawyer nominated by President Trump to
oversee the Treasury Department’s use of $500 billion in
coronavirus recovery funds.

Senators voted
51-40 to confirm Brian Miller, a White House
lawyer since 2018 who previously worked as a federal prosecutor and
inspector general for the General Services Administration, as
special inspector general for the pandemic recovery
fund.

The position, created as part of the $2.2 trillion CARES Act
passed in March, is certain to be highly scrutinized.

Democrats have criticized Miller’s work at the White House and
questioned his ability to serve as an
independent watchdog. "As an IG nominee with
personal ties to the White House Counsel's Office and an
administration outwardly hostile to anyone who tries to hold the
president accountable, Mr. Miller failed in committee to explain,
or in the letters afterwards, how he will establish his
independence from his current boss," Democratic Senator Sherrod
Brown
said of Miller.

Senator Doug Jones of Alabama was the only Democrat to vote for
Miller.

During his confirmation hearing last month, Miller pledged he

would not seek Trump’s approval before
communicating with Congress and would resist any pressure from the
administration to undercut his independence. "If confirmed, I will
conduct every audit and investigation with fairness and
impartiality," Miller said at his hearing. "I will be vigilant to
protect the integrity and independence of the Office of Special
Inspector General."

The president, chafing at oversight, has
fired several inspectors general in recent months,
triggering criticism that the moves were political retaliation.

Miller's office will reportedly have a budget of $25
million.

Quote of the Day: Our Inefficient Infrastructure

“The bulk of our nation’s infrastructure — our roads,
bridges, public transit and rail systems, the things that hundreds
of millions of American families and businesses rely on every
single day — is not only badly outdated, in many places it’s
downright dangerous and holding our economy back. Yet for decades,
Congress has repeatedly ignored the calls for an overhaul and
instead simply poured money into short-term patches. The result?
We’re still running our economy on an inefficient, 1950s-era system
that costs Americans increasingly more time and money while making
the transportation sector the nation’s biggest source of carbon
pollution.”

– Rep. Peter DeFazio (D-OR), on the
release of a five-year, $494 billion
transportation bill Wednesday.

Number of the Day: Telehealth Could Grow to $250 Billion

“With the acceleration of consumer and provider
adoption of telehealth and extension of telehealth beyond virtual
urgent care, up to $250 billion of current US healthcare spend
could potentially be virtualized,” says a
report by consulting firm McKinsey &
Company.

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