Republicans Roll Out $1 Trillion Coronavirus Relief Plan

Republicans Roll Out $1 Trillion Coronavirus Relief Plan

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Plus, why negotiations will be so much harder this time
Monday, July 27, 2020

Republicans Roll Out $1 Trillion Coronavirus Relief Plan

After struggling for days to coalesce around a plan, Senate Republicans on Monday released a $1 trillion coronavirus relief package, dubbed the HEALS Act, an acronym for Health, Economic Assistance, Liability Protection and Schools.

The proposal — which arrives as a host of emergency programs signed into law last spring, including enhanced unemployment insurance benefits, are expiring — will serve as a starting point for what are expected to be difficult negotiations with Democrats, who in May passed a $3 trillion relief package in the House.

The rollout comes after Treasury Secretary Steven Mnuchin and White House Chief of Staff Mark Meadows reportedly spent the weekend on Capitol Hill negotiating the text of the plan with Senate aides. At the same time, the White House, in an acknowledgment that Congress may still be weeks away from a vote on a coronavirus package, continued over the weekend to suggest the idea of a narrower bill that would include only unemployment insurance, school funding and a liability shield.

“To give a sense of the optimism on the GOP side right now, White House officials spent much of the weekend floating a less ambitious Plan B option -- before their Plan A even sees the light of day,” CNN’s Phil Mattingly says. “Republicans are, just on Monday, releasing their opening bid, which President Donald Trump's administration is already moving away from in order to pitch a scaled-back proposal Democrats have already rejected. This is, to say the least, not an ideal way to kick off long-delayed bipartisan talks.”

Some key provisions in the GOP proposal:

Unemployment benefits:
Republicans propose to cut the $600 per week federal benefit provided by the CARES Act and replace it with a system that provides 70% of wages, with a cap. States would be given two months to set up systems capable of making that calculation, which could be a serious challenge for technologically deficient employment offices. During the transition period, unemployed workers would receive a flat $200 per week in extra relief, which, when combined with state-level insurance payments, would approximate the 70% wage replacement target.

The National Association of State Workforce Agencies has expressed concerns about the GOP’s proposed unemployment system, saying it would take anywhere from eight to 20 weeks to implement. Democrats, and many economists, warn that cutting the $600 payments will hurt workers and the broader economy. Democrats have instead proposed extending the $600 payments through January or tying the level of emergency payments to state unemployment levels.

Stimulus payments:
The GOP defends its push to cut emergency unemployment benefits in part by providing for another round of $1,200 stimulus checks for American adults earning less than $75,000 per year, following the model of the first round provided by the CARES Act, though with a new allowance for adult dependents.

School aid:
The package calls for $105 billion for schools, with $70 billion designated for K-12, $30 billion for higher education, and $5 billion for governors to use as they see fit.

Coronavirus testing:
This was an area of dispute between the White House and Senate lawmakers. In the end, the package would provide another $16 billion for grants to states to cover the cost of testing, in addition to the $9 billion in uncommitted funds left over from the CARES Act, for a total of $25 billion.

Liability shields:
Businesses, schools, health care providers and nonprofits that are reopening would receive legal protection from lawsuits related to coronavirus illnesses and deaths.

Small business:
The Paycheck Protection Program would be extended with more funding and change its rules to allow hard-hit small businesses take out a second loan.

The bill would extend the moratorium on evictions established by the CARES Act.

Republicans would add $26 billion for research and distribution of coronavirus vaccines.

Tax breaks:
Republicans want to provide a higher level write-offs for business meals; an enhanced employee retention tax credit; and deductions for employer purchases of coronavirus-related supplies such as personal protective equipment.

FBI headquarters:
The bill includes nearly $1.8 billion for a new FBI headquarters building in Washington, D.C., across from the street from the Trump International Hotel. Sen. Richard Shelby (R-AL) said the Trump administration requested this provision. Asked what it had to do with coronavirus relief, Shelby said, “That's a good question.”

Why Negotiations Will Be Much, Much Harder This Time

House Speaker Nancy Pelosi (D-CA) and Senate Minority Leader Chuck Schumer (D-NY) are set to meet with Mnuchin and Meadows this evening to begin formal talks.

The two sides are trillions of dollars apart, and miles apart ideologically on some key issues. CQ Roll Call’s Shawn Zeller notes that the politics of a deal will be harder now, with the election drawing near, than they had been in March, when the CARES Act passed with bipartisan support.

As dissatisfaction with Trump’s handling of the pandemic continues to run high, Zeller reports that the publication’s Capitol Insiders Survey of 126 congressional aides this month “found that nearly two-thirds of Democratic staffers thought the virus would benefit their side, politically, in November. Only 6 percent of the GOP respondents thought it would help theirs.” Zeller adds that Democratic aides surveyed earlier this month said by a 51-36 margin that they preferred to find areas of compromise than try to look for an edge in the elections.

Still, the reality — and public perception — of the pandemic may stiffen Democrats’ resolve in rejecting the Republican proposal, which they say falls far short of what’s needed. “Democrats don’t sound like a party willing to accept the GOP proposal,” Zeller writes. “But are they willing to take nothing, then, if Republicans refuse to move their way, and if it means millions of constituents will suffer?”

Republicans are in a pickle, though, as some members push for more aid and others object to another round of deficit spending on top of the trillions already provided for coronavirus relief. “There is significant resistance to yet another trillion dollars," said Sen. Ted Cruz (R-TX). “The answer to these challenges will not simply be shoveling cash out of Washington, the answer to these challenges will be getting people back to work. And as it stands now, I think it’s likely that you’ll see a number of Republicans in opposition to this bill and expressing serious concerns.”

Sen. Lindsey Graham said this weekend that Republican opposition to another round of aid runs deep. “Half the Republicans are going to vote no to any phase four package. That’s just a fact,” he said.

Republicans face serious risks, though, if they’re seen to be taking away the lifeline keeping millions of Americans afloat. “McConnell and Trump know it’s likely that voters will blame Trump if the economic hole deepens,” Zeller writes, “and that a Democratic takeover of the White House, and the Senate, may result.”

Explaining Trump’s Approach to the Coronavirus Pandemic

The Washington Post’s Ashley Parker and Philip Rucker write that one question hangs over President Trump as the country grapples with the pandemic and the president looks to bolster his re-election prospects: “Why not try harder to solve the coronavirus crisis?” They report that both Trump allies and opponents “agree he has failed at the one task that could help him achieve all of his goals — confronting the pandemic with a clear strategy and consistent leadership.”

The answer to the question, they report, hinges on a combination of Trump’s personality and the information he receives:

“People close to Trump, many speaking anonymously to share candid discussions and impressions, say the president’s inability to wholly address the [coronavirus] crisis is due to his almost pathological unwillingness to admit error; a positive feedback loop of overly rosy assessments and data from advisers and Fox News; and a penchant for magical thinking that prevented him from fully engaging with the pandemic.”

Read more at The Washington Post.

Drugmakers Pull Out of White House Meeting: Report

Politico’s Sarah Owermohle reports that President Trump’s planned meeting with top pharmaceutical company executives Tuesday has been canceled after industry lobbying groups refused to send any members:

“Drugmakers and Trump were slated to discuss an executive order, signed Friday but not yet released, that would order health officials to release a plan linking Medicare payments for certain medicines to lower costs paid abroad. The provision, known as a most-favored-nations rule, has been lambasted by the drug industry and some patient groups that say it would curb innovation and reduce drug access. … The drug lobbies PhRMA and BIO were reluctant to send representatives from their member companies — many of them multibillion-dollar manufacturers of the world’s best-selling medicines and vaccines — after conflicting reports last week about whether the White House would include the rule and little information to date about what the new rule would look like, three people familiar with the discussions said.”

Quote of the Day

“I think politically, the main objective will be to have something he can call a plan, but it will be smaller than a plan. Just something that he can talk about. But it’s almost inconceivable that anything can be delivered legislatively before the election.”

Drew Altman, president and CEO of the Kaiser Family Foundation focused on health policy, in a Politico piece that reports that President Trump “is suddenly talking about health care again,” with White House aides touting an upcoming speech in which the president will lay out his health care vision.

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