Senate Majority Leader Mitch McConnell (R-Ky.) is getting much of what he wants in an emerging coronavirus relief package, after months of digging in his heels against a demand by Democratic leaders to pass a multitrillion-dollar package that would shore up the ailing finances of state and local governments.
The GOP leader isn’t getting liability protection for businesses and other organizations but McConnell himself last week proposed dropping that controversial item along with another large tranche of funding for state and local government.
State and local funding was a top priority of Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Charles Schumer (D-N.Y.).
Democrats are getting $90 billion in relief for local governments but it will be distributed by the Federal Emergency Management Agency, meaning city and state leaders will have less control. Democrats say that money for housing assistance will also help ease the fiscal burdens on states.
But McConnell is getting a deal a lot closer to what Democrats dismissed as the “emaciated” plan he pushed in recent months than the $2.2 trillion HEROES Act that Pelosi and Schumer said should have been the “starting point” of the talks.
That was quickly leading to some criticism on Wednesday as it emerged the sides were closing in on an agreement, though in Congress, some Democrats taking shots at the package still said it should be approved.
“This is not any place close to what is needed,” Sen. Elizabeth Warren (D-Mass.) said of the emerging $900 billion deal.
But Warren said Democrats have little choice but to accept a much smaller relief package than they wanted in order to get a deal.
“That makes for a very difficult negotiation,” she said of McConnell’s staunch insistence on a “targeted” package below $1 trillion.
She faulted the GOP leader, saying “Mitch McConnell is willing to let American families walk away with nothing.”
Sen. Bernie Sanders (I-Vt.) similarly criticized the bill while giving his blessing to its outlines.
Sanders had pushed for a new round of stimulus checks, something that will be a part of the final package.
But the checks will not be as large as he wished, and it will not include other provisions including the aid to local governments that he’d backed.
“There is simply not enough money in the proposal to deal with the unprecedented crises that we now face,” Sanders said Wednesday.
He told CNN that “we met very stiff resistance from Mitch McConnell and the Republican leadership.”
“What we got now is not enough but it is something,” he said.
A Democratic senator who requested anonymity to assess the emerging deal said McConnell largely got what he wanted.
“He got negotiators down way away from where Nancy Pelosi was and he’s going to do a package that’s not going to be enough for the American people and he’s not doing anything on state and local [funding] and he didn’t have to compromise on the liability protections,” the senator said.
Democratic leaders called for a $3.4 trillion relief package in May and then cut their demand down to $2.2 trillion in relief programs during negotiations with the White House this summer.
The pending deal is projected to cost $900 billion but after unspent funds from the CARES Act that Congress passed in March is repurposed, the total amount of new federal funding will be considerably less.
The emerging deal is less than the $1.1 trillion HEALS Act proposal that the Trump administration and Senate Republicans unveiled in late July. That plan included a second round of $1,200 stimulus checks structured in the same way as the direct payments included in the March CARES Act.
The joint White House-Senate GOP proposal also included $200 a week in supplemental federal unemployment assistance, $190 billion for a second round of Paycheck Protection Program (PPP) small-business loans, funding for COVID-19 testing and vaccine development, $105 billion in increased education funding and $63 billion to help domestic industries.
It provides $300 a week in federal unemployment assistance. Democratic leaders wanted $600 a week in supplemental federal unemployment assistance, an item included in the two versions of the HEROES Act passed in May and September.
It will also have more than $250 billion in PPP funding as part of more than $320 billion for the Small Business Administration. It is expected to include similar amounts of aid for K-12 and higher education as well as money for beleaguered industries such as airlines, buses, Amtrak and public transit.
A senior Democratic aide argued Wednesday that McConnell lost big by failing to secure the liability protection language he has insisted for months would be included in any deal.
“An agreement could have been reached months ago had McConnell and Republicans not insisted it include corporate immunity. No amount of Republican spin will change the fact that their gambit failed and American will be better off because Mitch McConnell didn’t get his way,” the aide said.
But some House Democrats said the emerging deal is a major blow to Pelosi. Weeks before the election, White House negotiators had offered the Democrats a $1.9 trillion relief package, but Pelosi rejected it at the time, saying it fell short of the $2.2 trillion that was needed. Pelosi and Treasury Secretary Steven Mnuchin also clashed on coronavirus testing language, sources said.
Now, months later and with tens of thousands of more Americans dead from the pandemic, Pelosi is preparing to accept a COVID-19 package that is about $1 trillion less than that last White House offer.
Pelosi has argued, however, that it’s wrong to focus only on the dollar figures and that the country is now in a better position. She said next month America will have a new president who takes the coronavirus pandemic seriously, and vaccinations are underway.
Democrats also hope to move another package after President-elect Joe Biden is inaugurated.
But there’s no guarantee that will happen, and any new agreement would again have to go through McConnell. Two runoff races in Georgia will determine whether McConnell remains majority leader. Democrats need to win both to put him in the minority. Yet even then, they will likely have to work with the GOP leader given the slender majority they would hold.
Pelosi herself will have a smaller majority after Democrats lost House seats in this year’s election.
Biden pressed Democrats to reach a deal, and on Wednesday he backed the emerging package while calling it a “down payment” on additional aid that will come once he takes power.
Democratic aides, asked about the criticism that McConnell was getting much of what he wanted, noted that Pelosi and Schumer secured funding for priorities that McConnell did not support, including food security aid and more money for beleaguered transportation systems.
House Democratic Caucus Chairman Hakeem Jeffries (D-N.Y.) defended Pelosi’s negotiating strategy, saying there was no reason to believe McConnell was on board with the White House’s $1.9 trillion plan.
“I don’t believe that it was a mistake because there was no real indication that they were serious underneath that $1.9 trillion to provide the type of relief that we believe was necessary in order to aggressively confront the COVID-19 pandemic,” Jeffries told reporters.
“At the end of the day, the Trump administration can say one thing, theoretically,” Jeffries added, “but if they haven’t convinced Mitch McConnell, who was still at $500 billion, to put the bill on the Senate floor and secure the Republican votes necessary to pass, it actually was a fictional offer that had no basis in reality.”
The emerging $900 billion deal largely hews to the outline of a $748 billion proposal unveiled this week by the bipartisan House Problem Solvers Caucus and Senate moderates.
Instead of $160 billion in direct funding for state and local governments, it includes $90 billion for the Federal Emergency Management Agency to distribute to meet state and local emergencies. Democrats will also argue that the package will assist cities and states by funding health programs, education and housing assistance.
It also includes direct stimulus payments of between $600 and $700 to individuals as well as children, half the amount that the White House and Democrats were calling for in recent months.
“When it’s inked, this deal will be a huge victory for the American people and for the way Congress should work: Democrats and Republicans sitting at the table, putting country ahead of party,” said Problem Solvers Caucus Co-Chairs Josh Gottheimer (D-N.J.) and Tom Reed (R-N.Y.).