Georgia Runoffs Could Determine Next Stimulus

By Yuval Rosenberg

How Georgia Senate Races Could Determine What Congress Gets
Done in 2021

Happy new year! We hope your 2021 is off to a good start. Here’s
a look where things stand and some key dates ahead as we plow into
the first year of the Biden administration and the 117th
Congress.

Pelosi gets a fourth term as speaker: The new Congress
was sworn in on Sunday, and Nancy Pelosi (D-CA) was elected to her
fourth term as House speaker by a narrow 216-209 margin that
highlights the
challenges the White House and Democratic
lawmakers may face in driving their agenda. “As we are sworn in
today, we accept a responsibility as daunting and demanding as any
previous generation of leadership have ever faced,” Pelosi said,
noting the 350,000 American lives lost due to the Covid-19
pandemic. “Our most urgent priority will continue to be defeating
the coronavirus. And defeat it we will.”

Congress overrode Trump’s NDAA veto: In the last vote of
the 116th Congress, lawmakers delivered a rebuke to President
Trump, with the Senate on Friday voting 81-13 to override Trump’s
veto of the annual National Defense Authorization Act, which sets
spending levels and lays out policy for the Pentagon. It was the
first veto override of Trump’s term. “This vote was undoubtedly a
bipartisan rebuke of President Trump. He tried to use our troops as
political pawns and distort what this bill is about. In the end, he
lost," Sen. Jack Reed (D-RI)
said in a statement after the vote.

No $2,000 checks: The Senate adjourned without voting on
whether to increase the $600 direct payments provided under the
latest Covid relief to$2,000. Senate Majority Leader Mitch
McConnell (R-KY) derided the increased payments as "socialism for
rich people." Democrats have said they will continue to push for
the larger payments in the early days of the new Congress, but the
fate of those checks — and any additional pandemic stimulus —

may rest on Tuesday’s runoff elections for two
Georgia Senate seats.

A
poll released Friday by liberal think tank Data
for Progress found that 47% of the 1,166 people surveyed blamed
"Republicans in Congress and Senator Mitch McConnell" for the lack
of a deal to provide larger checks while 32% blamed "Democrats in
Congress and House Speaker Nancy Pelosi." Another 15% of
respondents pointed the finger at Trump.

Georgia Senate runoffs will set the stage for next two
years: The results of Tuesday’s Georgia Senate runoffs will
determine much of what happens on Capitol Hill in 2021 and 2022.
“It is impossible to overstate how critical these races are for
fiscal, tax, and regulatory policy over the next 2 years,” analyst
Chris Krueger of the Cowen Washington Research Group wrote in a
note to clients Monday.

The Washington Post’s Tory Newmyer
laid out what could be at stake in the races
between Republican Sens. David Perdue and Kelly Loeffler and
Democratic challengers Jon Ossoff and Raphael Warnock:

“A Democratic sweep would hand the party control of the
Senate, boosting the odds the Biden administration could steer more
economic relief spending through Congress. Investors see fiscal
stimulus as bullish for stocks but could also worry about what an
all-Democratic Washington means for corporate taxes and
regulation.”

A Democratic administration paired with a Democratically
controlled House and Senate would be more likely to push for a
larger stimulus as well as corporate tax hikes and more aggressive
regulation. Democratic wins could also allow Biden to round out his
administration with more liberal appointees, potentially leading to
“a more aggressive administrative agenda,” Compass Point Director
of Policy Research Isaac Boltansky noted, according to the
Post.

Given those expectations, Trump’s continued efforts to
overturn the election results in Georgia and elsewhere could
undermine Perdue and Loeffler — and, Newmyer suggests, may deliver
“a parting gift to fans of more fiscal stimulus.”

Big dates ahead: Here are some other key dates and
deadlines to keep in mind over the coming few months.

January 6: Congress
counts Electoral College votes, the last
step in reaffirming Joe Biden’s election victory.

January 20: Biden’s inauguration.

January 31: The renewed federal eviction moratorium
is set to expire.

March 14: Enhanced federal
unemployment benefits are set to expire.

1.2 Million Unemployed Still Waiting for Benefits:
Analysis

Millions of unemployed Americans will start receiving an
additional $300 per week in jobless benefits thanks to the $900
billion coronavirus relief bill
signed into law on December 28. But about 1.2
million unemployed workers will be left out in the cold, according
to an
analysis by The Washington Post, because their
applications for benefits are still hung up at their state
unemployment offices — and, in many cases, have been for
months.

According to the Post, about 703,000 applications for
unemployment aid are currently in appeals at the state level, and
another 529,000 people are simply waiting for states to make
decisions on their initial applications for benefits. Some of the
applications date back to last March, when the Covid-19 pandemic
was beginning to shut down the economy.

The holdups have various causes, including efforts to cut
down on fraud, but share a common theme of understaffed and
underequipped state unemployment offices. “We are still dealing
with twice the normal number of claims even today, nine months into
the pandemic, while simultaneously continuing to plow through the
record onslaught of claims that came in the door from March to
June,” a spokesperson at the Ohio Department of Job and Family
Services told the Post.

A system with a lot of cracks: The
benefits system for workers who lose their jobs struggles to
function properly even under the best of circumstances, and the
pandemic has pushed it to the breaking point. Few states can handle
the sheer number of applications they have received, and many state
systems are running on poorly designed or outdated
software.

On top of that, Congress created new unemployment programs
and new rules in response to the pandemic — a welcome development
for those who received benefits, but another challenge for already
overburdened unemployment offices. According to the Post, the
majority of people waiting to receive their benefits have applied
for Pandemic Unemployment Assistance, a temporary federal program
that is designed to help the self-employed, gig workers and parents
who cannot work because their children’s schools are closed. Some
state officials reported that uncertainty about eligibility for the
new program was contributing to the delays.

No additional help for states: An
early version of the Covid relief package included $1 billion for
states to use to update their unemployment systems, but those funds
didn’t make it to the final bill, leaving states to struggle with
massive caseloads and sometimes unclear regulations on their
own.

“It’s crazy our computer systems couldn’t be programmed to
do the right thing,” Glenn Hubbard, former chief economist for
George W. Bush, told the Post. “Something will happen again some
day and we shouldn’t be in this position.”

40% of Farmers’ Income Came From Federal Government in 2020:
USDA

Although total receipts dipped in 2020, American farmers
are expected to record their highest net income in seven years —
thanks in large part to payments from the federal government that
accounted for nearly 40% of farmers’ income.

David Pitt of the Associated Press
reports on the latest forecast from the Department
of Agriculture:

“Farm cash receipts are forecast to decrease nearly 1%
to $366.5 billion, the lowest in more than a decade, measured in
real dollars. Direct federal government payments saved farmers’
bottom line: Farmers overall saw a 107% increase in direct payments
from 2019, when a third of net income came directly from the
government.”

It's estimated that farmers will have received $46.5
billion from the government in 2020, the largest direct payment
total in history. That sum includes $32.4 billion in payments
related to the coronavirus pandemic, and billions more from the
Trump administration effort to make up for losses associated with
the trade war with China.

3 Key Social Security Changes for 2021

A number of
changes to Social Security took effect on January
1.

  • Beneficiaries will get a 1.3% cost-of-living increase in
    payments. The average monthly Social Security payment to retired
    workers will go up by $20 to $1,543, with married couples who both
    receive benefits will see their average payment rise $33 to
    $2,596.

    Earnings subject to the Social Security tax went up
    from $137,700 last year to $142,800.

  • The full retirement age rose to 66 years and 10 months
    for those born in 1959. The full retirement age has been increasing
    in two-month increments for those born between 1955 and 1959 until
    it reaches 67 for anyone born in 1960 or later.
  • Earnings subject to the Social Security tax went up from
    $137,700 last year to $142,800.

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