This is the top story from our daily newsletter published on August 7, 2020. To have this and more delivered directly to your inbox scroll down and enter your email or click here to sign up.
Stimulus Statistics and Sticking Points: Today is the self-imposed deadline the White House and Congressional Democrats set for themselves to reach a deal on a new coronavirus relief package. Normally, these negotiations change so much by the time they get finalized we don’t devote a huge amount of coverage to them until they’ve been signed, sealed, and delivered (and they’re yours!). Nevertheless, we’re going to break down where we stand and what each side is saying about the discussions as we head into the weekend. And since these negotiations involve trillions of dollars, we’re going to break the debate down in a numerical fashion today courtesy of statistics provided by the Associated Press. Let’s start with the sticking points in order of largest to smallest denominations:
$3 trillion: This is the amount House Democrats requested for the next coronavirus relief package in mid-May. It was called the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act.
$1 trillion: This is the amount that Senate Republicans requested for their version of the next coronavirus relief package in late-July. It was called the Heath, Economic Assistance, Liability Protection and Schools (HEALS) Act.
$150 billion: That’s how much the White House offered Democrats in new appropriations to help state and local governments alleviate revenue losses from the damage the coronavirus has wrought on the economy. “That matches the amount appropriated after a huge behind-the-scenes battle during negotiations on the bipartisan $2 trillion coronavirus bill that passed in March. Much of that original money is left over, and all sides want greater flexibility in using it, but Pelosi is demanding far more — almost $1 trillion — and key Republicans like Susan Collins of Maine, Cory Gardner of Colorado and Mitt Romney of Utah are pressing for more money as well.”
$100 billion: “A cornerstone to any agreement, and one of the areas in which both sides are eager to display generosity, involves over $100 billion for help to school systems. The White House and its GOP allies are pressing for more money for schools that return students to the classroom and want to help private schools as well. Very tricky talks remain, and Republicans are carping that Pelosi is being too greedy.”
$100 billion: That’s how much is left over from the Paycheck Protection Program. This “relief money for small businesses is up for grabs. Top advocates like Sen. Marco Rubio, R-Fla., are backing plans to ease some loan forgiveness rules and permit a second round of PPP payments to especially hard-hit businesses.”
$10 billion: That’s how much Democrats are requesting for Postal Service related expenses, including overtime and other costs. This is “down from a bloated $25 billion plan in the House-passed coronavirus bill. Key Republicans whose rural constituents are especially reliant on the post office support the idea.”
$600: “Pelosi is staking out a hard line on extending a $600-per-week supplemental pandemic federal jobless benefit, which lapsed last week. Republicans offered to extend the benefit into December and cut it to $400, according to aides confirming leaks reported in Politico.”
$1,200: “Pelosi and President Donald Trump agree on another $1,200 direct payment to most Americans, making the idea all but certain to be included in the final agreement, at a cost in the $300 billion range.”
15%: “Pelosi is also pressing the case for a 15% increase in food stamp benefits that are especially important to key progressive constituencies, and Democrats won’t allow $20 billion in aid to farmers without a big trade-off on food aid.”
Liability Shield: “Senate Majority Leader Mitch McConnell, R-Ky., continues to insist that the legislation include some sort of liability shield against lawsuits brought against businesses, schools and universities, and charities that operate during the pandemic. Pelosi is opposed for now, but Democrats — who see it’s a key to any final agreement — aren’t ruling the idea out.”
Non-Coronavirus Related Items: “The competing bills from House Democrats and Senate Republicans include a fair amount of money for non-coronavirus-related items. The Senate proposal contains an almost $2 billion new FBI headquarters in Washington, D.C., and $30 billion for the Pentagon, including direct help for powerful defense contractors. That’s likely to get dumped, as will as more generous federal tax deduction for state and local taxes that Democrats included in their bill.”
Now, we realize that’s a lot to digest already, and it should give you enough information to be dangerous in your COVID-compliant cocktail parties this weekend. As always, we also want to provide some of the commentary surrounding these negotiations. Today we’ll keep it somewhat shorter:
On the Right: The Wall Street Journal Editorial Board is calling this “Trump’s Trillion-Dollar Choice”: “As negotiations for another giant spending bill proceed in Washington, President Trump faces a choice. Does he do another deal giving Speaker Nancy Pelosi most of what she wants, perhaps splitting the GOP in the process? Or does he press his own economic agenda and, if the Speaker blocks it, take that to the voters in November? … “The polls show the economy is the one issue on which a majority trusts Mr. Trump more than it does Joe Biden. But if he signs another Nancy Pelosi special, voters can be forgiven if they wonder what the economic policy difference is between Republicans and Democrats.”
On the Left: POLITICO highlights the other side of the aisle in a piece titled, “Emboldened Pelosi takes hard line as relief talks drag on”: “Pelosi is where she likes it best — slugging it out with Republicans on another record-breaking coronavirus relief package. Now, even more than during her first go-round as speaker, Pelosi wields more power than anyone in the Capitol, even Senate Majority Leader Mitch McConnell (R-Ky.) … “But the California Democrat is also taking a huge risk during the coronavirus aid talks as she remains almost entirely unyielding in her demands — even as negotiations drag on and millions of out-of-work Americans lose their federal aid. Both she and Republicans risk overplaying their hands and ending up with a stalemate that leads to retribution from angry voters in November.”
Flag This: The focus now shifts to President Trump. According to senior administration officials, Trump could issue a series of executive orders to address the economic crisis facing millions of Americans if no deal can be reached with Congress as soon as today. Wall Street futures are currently negative as relief talks remain on life support as investors have largely priced in lawmakers being able to reach an agreement.