WASHINGTON (AP) — Senate Majority Leader Mitch McConnell on Thursday unveiled a sweeping economic rescue package to pump out $1,200 in direct taxpayer checks, $300 billion for small businesses to keep workers idle on the payroll and $208 billion in loans to airlines and other industries.
It’s the first Republican bid on the biggest legislative package yet to respond to the coronavirus. epidemic.
GOP leader’s effort builds on President Donald Trump’s call for Congress to ‘do it big’ as lawmakers rush to hammer out $1 trillion in economic aid and stimulus package amid crisis pandemic and the nationwide shutdown that are pushing the country into a likely recession.
“We need to take bold and quick action as soon as possible,” McConnell said, announcing his plan in the Senate.
The 247-page McConnell CARES Act puts the leader’s stamp on opening talks with Democrats in Congress as lawmakers prepare to fast-track perhaps the most urgent legislative undertaking since the 2008 financial crisis. negotiations begin Friday.
Despite the enormous pressure on Washington to act, the upcoming talks will certainly face challenges. Democrats have said the plan does not go far enough and some Republicans oppose its provisions. The negotiations could push until the weekend.
“On first reading, this is not pro-worker at all and instead puts business far ahead of workers,” House Speaker Nancy Pelosi and Senate Democratic Leader Chuck Schumer said in a joint statement.
The GOP leader’s plan aims to bolster households, businesses and the health care sector, which are preparing for an expected onslaught of patients falling ill with the virus that causes COVID-19.
The one-time $1,200 allowances would be sent to individuals — $2,400 for couples — phased out at income thresholds of $75,000 for individuals and $150,000 per couple. In addition, there would be payments of $500 for each child.
Individuals and families could also make penalty-free withdrawals of up to $100,000 from their tax-deferred 401(k) retirement funds. The plan would also ease tax rules on charitable donations.
Additionally, the McConnell bill would provide $300 billion to small businesses, with loans that would eventually be forgiven for employers who use them to cover payroll expenses.
To shore up the industry, McConnell’s plan would provide $208 billion in loans and loan guarantees to struggling sectors, including $50 billion for commercial airlines, $8 billion for air cargo carriers and $150 billion. billions of dollars for other eligible businesses, but those loans would have to be repaid. .
Companies would also be allowed to defer payment of the 6.2% payroll tax and benefit from more generous rules for business deductions of losses and interest expenses, under the GOP leader’s plan.
The proposal also includes a specific provision allowing the Secretary of the Treasury to “participate in the gains,” through stock options or other financial instruments, of companies that receive federal assistance.
At the same time, caring for the expected influx of sick Americans is a priority for Congress.
The McConnell proposal contains a series of health care provisions – including permanent liability protection for manufacturers of ventilators and other desperately needed medical equipment to deal with the pandemic.
At the consumer level, McConnell’s bill would enshrine in federal law insurers’ commitment that coronavirus testing will be free to policyholders. Additionally, the bill requires coverage of coronavirus vaccines as a preventative service, at no cost to patients.
For the health care industry, the bill would establish a new Medicare payment for treating COVID-19 patients. It would suspend until the end of this year a 2% reduction in Medicare payments to providers under previously defined budget restrictions.
Trump administration officials, including Treasury Secretary Steven Mnuchin and economic adviser Larry Kudlow, are expected to return to Capitol Hill on Friday to kick off bipartisan talks with Senate Democrats.
Pelosi and Schumer said they look forward to working with Republicans “in a bipartisan way to deliver to the American people as soon as possible.”
Democratic leaders, however, said their top priority is to “ensure that all workers are protected from losing a paycheck or no family falling into financial ruin because of this pandemic.”
Democrats criticized the GOP plan as not doing enough for hospitals and health care providers. Groups representing hospitals, doctors and nurses are asking Congress for $100 billion.
Democratic leaders have called on Trump to ramp up production of medical supplies and quickly erect temporary field hospitals under new authorities he invoked in the Defense Production Act.
“America needs a Marshall Plan for our health care system,” Schumer said, citing the post-World War II program in which the United States funded reconstruction in Europe.
Maintain paychecks for inactive workers as unemployment claims soar is a top priority for Republican and Democratic plans coming out of Congress.
But how best to send direct payments to Americans — in the form of one-time benefits, ongoing wage support or unemployment checks — is a crucial debate.
Democrats have other ideas for helping Americans by pumping more money into the existing unemployment insurance system. Schumer called it “employment insurance” – which he referred to as “unemployment insurance on steroids”.
Some GOP senators have rejected the idea of one-time direct checks, preferring instead to use federal dollars to keep workers who are asked to stay home on company payrolls.
“What I want is an income, not a check,” said Sen. Lindsey Graham, R.S.C., summarizing the views of some emerging from a lengthy private meeting of GOP senators on Capitol Hill .
McConnell’s proposal aligns with the Trump administration’s initial idea of economic aid. Mnuchin suggested Thursday that Treasury Direct could send direct payments of $1,000 per adult and $500 per child so that a family with two parents and two children would receive $3,000. He said the first checks would be sent on April 6, with a second wave in mid-May.
Meanwhile, industries of all kinds are lining up for help. The total price will certainly exceed $1 trillion, lawmakers said.
Pelosi, on a lengthy conference call with more than 220 House Democrats, urged them to “think big,” according to people on the call who were granted anonymity to discuss it. She reminded them that interest rates are low and the expense should be seen as an investment.
As Congress rushes to compile the bailout, it is also considering its own way of doing business. Two lawmakers have now tested positive for the COVID-19 virus, others are self-isolating and the usually tradition-bound Congress has been called on to relax the rules and allow remote voting. Pelosi assigned a senior committee chairman to study potential changes in House procedures.
The Senate plans to remain in session this weekend. The House, which is on vacation, will not be recalled before the time of the vote.
House Republicans, on their own private conference call, expressed concern about boarding planes back to Washington, according to Matt Sparks, spokesman for Minority Leader Kevin McCarthy.
Trump has already signed into law a more than $100 billion bill to boost coronavirus testing and guarantee paid sick leave for millions of affected workers. Earlier, Trump signed an initial $8.3 billion package from Congress.
For most people, the new coronavirus only causes mild or moderate symptoms, such as fever and cough. For some, especially the elderly and people with existing health conditions, it can cause more serious illnesses, including pneumonia.
The vast majority of people are recovering from the new virus. According to the World Health Organization, people with mild illness recover in about two weeks, while those with more severe illness can take three to six weeks to recover.
Associated Press writers Darlene Superville, Matthew Daly, Mary Clare Jalonick, Ricardo Alonso-Zaldivar and Padmananda Rama in Washington contributed to this report.
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