San Diego Union-Tribune (Sunday)
DIVIDED SENATE PASSES AID PLAN
50-49 vote sends revised $1.9 trillion stimulus package back to House for approval, expected this week
President Joe Biden’s sweeping $1.9 trillion stimulus bill passed a deeply divided Senate on Saturday over unanimous Republican opposition, as Democrats pushed through a pandemic aid plan that includes an extraordinary increase in safety net spending that amounts to the largest anti-poverty effort in a generation.
The package, which still must pass the House before it heads to Biden’s desk to be signed into law, is the first major legislative initiative of his presidency. The measure seeks at once to curtail the coronavirus pandemic, bolster the sluggish economy and protect the neediest people within it. Republicans assailed it as unnecessary and unaffordable.
It would inject vast amounts of federal resources into the economy, including one-time direct payments of up to $1,400 for hundreds of millions of Americans, jobless aid of $300 a week to last through the summer, money for distributing coronavirus vaccines and relief for states, cities, schools and small businesses struggling during the pandemic.
Beyond the immediate aid, the bill, titled the American Rescue Plan, is estimated to cut poverty by one-third this year and would plant the seeds for what Democrats hope will become an income guarantee for children. It would potentially cut child poverty in half, through a generous expansion of tax credits for Americans with children, which Democrats hope to make permanent; increases in subsidies for child care; a broadening of eligibility under the Affordable Care Act and an expansion of food stamps and rental assistance.
As leading Democrats raced to avoid a lapse in unemployment
benefits set to begin on March 14, a groggy and bleary-eyed Senate approved the package 50-49, with one Republican absent. Final passage came after a grueling 27-hour session in which Democrats beat back dozens of Republican efforts to change the bill, and scaled back the jobless aid to placate moderates in their own ranks who were concerned that an overly generous federal payment would keep Americans from returning to work, stifling the recovery.
The marathon session featured the longest vote in modern Senate history, as Democratic leaders stalled for time during last-ditch negotiations with Sen. Joe Manchin, D-W.VA., a moderate holdout, to trim the unemployment benefits so the measure could proceed.
The resulting package was a narrower version of Biden’s original plan, with major progressive priorities either dropped or curtailed to accommodate Manchin and other moderate Democrats. Unlike the president’s proposal and a version passed by the House last weekend, it omits an increase in the federal minimum wage to $15. It also narrows eligibility for stimulus checks and reduces weekly unemployment payments, which Biden and Democrats had hoped to increase to $400.
Still, the pandemic aid bill was one of the most farreaching federal relief efforts ever to pass Congress, and represented a bid by Biden to use the power of the government to tackle the pandemic and invigorate the economic recovery by pouring immense amounts of money into initiatives to help low-income Americans and the middle class.
“The most important thing is what we delivered for people,” Sen. Chuck Schumer of New York, the majority leader, said in an interview. “The danger of undershooting is far greater than the danger of overshooting, and this may have been our last chance.”
The legislation would send another round of $1,400 direct payments to American taxpayers making $75,000 or less — or $112,500 for single parents and $150,000 for couples — and extend $300 weekly unemployment benefits through Labor Day, making a large portion of jobless aid from last year taxfree. It would provide $350 billion for state, local and tribal governments, $130 billion to primary and secondary schools, $14 billion for the distribution of a vaccine, $12 billion to nutrition assistance and money for reopening businesses around the country.
It would also provide a benefit of $300 per child for those age 5 and younger — and $250 per child ages 6 to
Highlights of the legislation
AID TO THE UNEMPLOYED
Expanded unemployment benefits from the federal government would be extended through Sept. 6 at $300 a week. That’s on top of what beneficiaries are getting through their state unemployment insurance program. The first $10,200 of jobless benefits would be non-taxable for households with incomes under $150,000. Additionally, the measures provides a 100 percent subsidy of COBRA health insurance premiums to ensure that the laid-off workers can remain on their employer health plans at no cost through the end of September.
MORE CHECKS
The legislation provides a direct payment of $1,400 for a single taxpayer, or $2,800 for a married couple that files jointly, plus $1,400 per dependent. Individuals earning up to $75,000 would get the full amount, as would married couples with incomes up to $150,000. The size of the check would shrink for those making slightly more, with a hard cut-off at $80,000 for individuals and $160,000 for married couples.
MONEY FOR STATE AND LOCAL GOVERNMENTS
The legislation would send $350 billion to state and local governments and tribal governments for costs incurred up until the end of 2024. The bill also requires that small states get at least the amount they received under virus legislation that Congress passed last March.
AID TO SCHOOLS
The bill calls for about $130 billion in additional help to schools for students in kindergarten through 12th grade. The money would be used to reduce class sizes and modify classrooms to enhance social distancing, install ventilation systems and purchase personal protective equipment. The money could also be used to increase the hiring of nurses and counselors and to provide summer school.
Spending for colleges and universities would be boosted by about $40 billion, with the money used to defray an institution’s pandemic-related expenses and to provide emergency aid to students to cover expenses such as food and housing and computer equipment.
AID TO BUSINESSES
A new program for restaurants and bars hurt by the pandemic would receive $25 billion. The grants provide up to $10 million per company with a limit of $5 million per physical location. The grants can be used to cover payroll, rent, utilities and other operational expenses.
The bill also provides $7.25 billion for the Paycheck Protection Program, a tiny fraction of what was allocated in previous legislation. The bill also allows more non-profits to apply for loans that are designed to help borrowers meet their payroll and operating costs and can potentially be forgiven.
TESTING AND VACCINES
The bill provides $46 billion to expand federal, state and local testing for COVID-19 and to enhance contract tracing capabilities with new investments to expand laboratory capacity and set up mobile testing units. It also contains about $14 billion to speed up the distribution and administration of COVID-19 vaccines across the country.
BIGGER TAX BREAKS
Under current law, most taxpayers can reduce their federal income tax bill by up to $2,000 per child. In a significant change, the bill would increase the tax break to $3,000 for every child age 6 to 17 and $3,600 for every child under the age of 6. The legislation also calls for the payments to be delivered monthly instead of in a lump sum. If the secretary of the Treasury determines that isn’t feasible, then the payments are to be made as frequently as possible.
Families would get the full credit regardless of how little they make in a year, leading to criticism that the changes would serve as a disincentive to work.
RENTAL AND HOMEOWNER ASSISTANCE
The bill provides about $30 billion to help low-income households and the unemployed afford rent and utilities, and to assist the homeless with vouchers and other support. States and tribes would receive an additional $10 billion for homeowners who are struggling with mortgage payments because of the pandemic. ASSOCIATED PRESS 17, increasing the value of the so-called child tax credit in an effort to significantly reduce child poverty. The bill also includes $45 billion in rental, utility and mortgage assistance, $30 billion for transit agencies, and billions more for small businesses and live venues.
The measure also would provide federal subsidies for people to keep the health insurance they had from work if they lost their jobs.
Researchers at Columbia University project the overall package will lift more than 13 million people from poverty this year, including nearly 6 million children, and estimate that a permanent program of children’s payments would decrease child poverty nearly in half.
“Not since Social Security have we made that kind of commitment to cut poverty,” said Christopher Wimer, a co-director of the university’s Center on Poverty and Social Policy.
The legislation remains broadly popular across the country, with state and local officials in both parties joining the chorus of industry groups, advocacy groups and voters calling for the federal government to provide additional relief. But congressional Republicans rallied against the plan, arguing that it was far more than what was needed and could overheat the economy. They cited a steady increase in vaccinations and more than $4 trillion allocated over the last year.
“The Senate has never spent $2 trillion in a more haphazard way or through a less rigorous process,” Sen. Mitch Mcconnell, R-KY., the minority leader, said Saturday morning as he urged his colleagues to vote against the bill.
They charged that in passing the pandemic relief package without their support or input, Biden had already failed to adhere to the promises of unity that carried him through the 2020 election and served as a cornerstone of his inaugural address. But Democrats scoffed at the complaints, noting that Republicans had not shown a willingness to negotiate a compromise that met the challenges the country faced.
Newly empowered with a razor-thin majority in the Senate, Democrats instead chose to bypass Republican opposition and the risk of a filibuster — which takes 60 votes to break — and pass the legislation using a fasttrack process known as reconciliation, which only requires a majority. But the strict budgetary rules governing the process forced Democrats to curtail their ambitions for the legislation, as did the competing factions of moderate and liberal lawmakers unafraid to wield their influence given the slim margins of control.
Even with changes, the bill remained more than than double the size of the roughly $800 billion stimulus package that Congress approved in 2009, when Biden was vice president, to counter the toll of the Great Recession. Top Democrats, many of whom voted to pass that bill and recalled winnowing down the package to appease Republicans, who still opposed it almost unanimously, said they were determined not to make the same mistake again.
Because the Senate package differs from the House version, it now returns to the House for a final vote, expected Tuesday. Frustrated progressives could revolt and try to block it, but given the wide array of liberal priorities it addresses, leading progressives in the Senate signaled they were satisfied.
The effort highlighted the divisions among Democrats about how aggressive to be in tackling liberal priorities. The minimum wage increase fell out of the measure after a top Senate official determined that it did not comply with the strict budgetary rules that apply to reconciliation bills. But when Sen. Bernie Sanders, IVT., chairman of the Budget Committee, sought to restore it to the measure, it fell well short of majority support, with far fewer than the 60 votes that would have been required. Seven Democrats and one independent who normally votes with them opposed the move.
Hoping to win over Manchin and other moderates, Democrats scaled back their hopes for raising the federal weekly unemployment payment to $400 and instead proposed keeping it at $300 but lengthening the duration of the program, until early October — about a month longer than Biden’s original plan. But even that solution proved unsatisfactory to Manchin, who insisted that the payments lapse sooner.
After hours of haggling, Democrats bowed to his wishes and agreed to forgo both the increase in payments and most of the additional extension. The resulting deal sets the expiration date for jobless aid at Sept. 6, just a week after the date Democrats had initially wanted.
But Democrats agreed to include a tax sweetener that would make the first $10,200 of unemployment payments from 2020 tax-free, in a bid to ensure that unemployed workers were not hit with an unexpected tax bill. After negotiations with Manchin, they limited it to those earning less than $150,000.
The legislation also would allocate $50 billion to the Federal Emergency Management Agency to bolster vaccine distribution and help support struggling families across the country, and send $49 billion for testing and tracing.