President-elect Joe Biden and other members of the Democratic party are now pushing House Speaker Nancy Pelosi toward accepting a smaller bill, according to reporting from multiple outlets, including The New York Times.
Pelosi, a champion of the updated $2.2 trillion HEROES Act, has been adamant that she will not budge on the bill’s cost, despite Senate Majority Leader Mitch McConnell’s insistence that he will only bring a “targeted,” $500,000 coronavirus relief bill to the floor of the Senate for a vote.
The impasse has left many wondering if the economy can stay afloat or rather will sink into another deep recession, as student loan deferrals, extra unemployment benefits and the eviction moratorium are all expected to expire before the beginning of 2021.
Multiple Democrats Now Support Signing a Smaller Stimulus
The HEROES Act has been on McConnell’s desk since the Democrat-controlled House passed the bill in May. During her weekly press conference, Pelosi called McConnell the main obstacle to a relief bill. McConnell then tweeted that he thought the Democrats’ bill was “unserious.”
Although both sides have agreed to more talks, it is unclear when — or even if — that will ultimately result in a package. However, as the negotiations drag on, some Democrats have begun expressing their doubts that holding out for a Biden administration will yield a better deal.
The Hill reported that Democratic Delaware Senator Chris Coons implied that he understands the Democrats are unlikely to get the $2.2 trillion they have been asking for from McConnell, and therefore said he is willing to settle for less.
“To me, it’s less about exactly what dollar amount than it is what are the areas where we’re providing some relief,” Coons said. “I think we ought to be doing a broad package that provides support to small businesses through another round of PPP, to schools, to public health agencies to prepare for vaccine distribution.”
Virginia Senator Tim Kaine said the runoff Senate races in Georgia, which could either confirm Mitch McConnell’s control of the Senate for more years or give Biden a completely Democratic Congress, are a motivating factor for getting a deal done, The Hill reported:
I think the Senate races in Georgia kind of put a premium on ‘we ought to try to get something.’ Because I think the two sitting senators kind of have to go out and … have something. And also it wouldn’t be bad for Democrats … to help the incoming Biden administration on that too. Biden wants something by the end of December, we ought to be able to find it.
Steny Hoyer, a Democratic Senator from Maryland, told Roll Call that he would be happy with getting a package done now and continuing to work on leftover items within the next year.
There Have Been Conflicting Reports About Biden’s Thoughts on a Stimulus Package
Biden, according to The New York Times, is calling on Democrats in Congress to agree to a smaller stimulus deal, citing fears that “the United States economy is headed for a ‘double-dip’ recession early next year.”
However, this is different from what Biden said during his November 16 speech, when he mentioned twice that he believes the HEROES Act should be passed, saying, “I would pass the Heroes Act. … Now, not tomorrow. Now.”
According to what a spokesperson for the Biden transition team, Andrew Bates, told The Washington Post’s Jeff Stein, Biden’s support of the HEROES Act has not changed at all. “This is incorrect. The president-elect fully supports the Speaker and Leader in their negotiations,” Stein reported.
However, The New York Times reported that a Biden transition aide, Jen Psaki, urged Pelosi and Schumer to take immediate action during a private meeting held on November 20, about which few details have been provided. “There needs to be emergency assistance and aid during the lame-duck session to help families, to help small business,” Psaki said. “There’s no more room for delay, and we need to move forward as quickly as possible.”
The Economy Remains in Dire Need
Many economic advisors are stressing that the economy cannot afford to wait until Biden is in office for coronavirus relief to be passed.
Some officials, such as Massachusetts Senator Elizabeth Warren, have called for Biden to cancel student loan debt as a way to ease Americans’ financial burdens. Others have urged Congress to compromise and act.
Members of The Aspen Institute’s Economic Strategy Group — which includes four former Treasury secretaries, former Federal Reserve Chair Ben Bernanke and multiple former White House economic advisers — wrote a letter to Congress, stating that economic catastrophe could result from failing to act before the year’s end. It read in part:
Amidst a resurgence in COVID-19 caseloads and continuing economic devastation from the pandemic, we urge Congress to enact legislation that focuses on the core measures necessary to provide additional fiscal relief as quickly as possible and no later than the end of this calendar year. …
Our nation’s leaders should act on another round of fiscal relief now. At the same time, the administration should act aggressively to deploy the unspent resources it already has to combat the virus and support businesses. Our country and economy cannot wait until 2021.
The letter also spelled out measures that it believes the next package should include, all of which are present in the HEROES Act and only some of which are included in McConnell’s $500 billion bill.
“(We endorse) extended federal government income relief to unemployed individuals, enhanced benefits to households who need help buying food, and measures to help people who are facing potential eviction and homelessness because of pandemic-related income loss,” the economic experts wrote. “Legislation should include fiscal support to state and local governments, which face budget shortfalls as a result of the pandemic while they face emergency spending needs, including much-needed funding for K-12 schools to open safely.”
Their call was echoed by local politicians, such as Pennsylvania Congressman Dwight Evans, who wrote in a letter that his Philadelphia-area constituents are facing a severe potential eviction crisis, Roll Call reported. In his letter, Evans wrote:
While undoubtedly, a substantial relief package is needed to address the impacts of the public health crisis in its entirety, I respectfully urge you to immediately pass bipartisan legislation with targeted funding that addresses the dire unemployment, housing, and small business needs of our communities at risk of further financial crisis as they attempt to safely and effectively mitigate the public health crisis.
“Please know that my constituents are now in a dire emergency — they cannot wait any longer,” he concluded.