Democrats are vowing to forge ahead with providing $2,000 stimulus payments after their party won control of the Senate this week with victories in two Georgia runoffs where the checks played a key role.
At a rally before Election Day, President-elect Joe Biden said that electing the two Democratic candidates would flip the majority, end a GOP blockade on bigger checks and allow for more coronavirus relief in the form of direct payments.
Now, Democrats say they plan to deliver on that pledge.
Senate Democratic Leader Charles Schumer (N.Y.), who is poised to become majority leader when Biden is inaugurated on Jan. 20, said Wednesday that “one of the first things that I want to do when our new senators are seated is deliver the $2,000 checks to the American families.”
Other Democratic lawmakers have emphasized the $2,000 payments following the projected victories for Jon Ossoff and the Rev. Raphael Warnock in Georgia’s elections.
“As Senators-elect Warnock and Ossoff have rightly pointed out, a Democratic Senate means that families across the nation will receive $2000 survival checks,” Congressional Progressive Caucus Chairwoman Pramila Jayapal (D-Wash.) said in a statement.
Biden on Wednesday reiterated his desire to pass additional coronavirus relief legislation.
“We need urgent action on what comes next, because the COVID-19 crisis hits red states and blue states alike,” he said in a statement.
In addition to Biden and Schumer, Speaker Nancy Pelosi (D-Calif.) has backed the bigger payments, which would come on the heels of $600 payments from the most recent COVID-19 relief bill.
The commitment on direct payments from the three top Democrats signals near-term action on legislation is likely to be a priority, said Todd Metcalf, a principal in the tax policy services group at PwC who previously served as chief tax counsel for Democrats on the Senate Finance Committee.
“That trifecta, they’re certainly going to do something to make good on that promise, and early on in the Biden term,” Metcalf said.
Both Warnock and Ossoff advocated for more direct payments to Americans in the weeks leading up to the runoffs. Those calls escalated after President Trump last month voice support for increasing the direct payments in the recently passed coronavirus relief package from $600 to $2,000.
Trump’s calls also prompted the two GOP candidates in the races to come out in support of bigger payments, breaking with many of their Republican colleagues on Capitol Hill.
Much of that GOP opposition was on display after the House passed a bill in late December to increase the payments to $2,000 in a bipartisan vote. When the measure arrived in the Senate, efforts by Democrats to pass the legislation were blocked on more than one occasion by Republican leadership.
Some GOP critics are opposed to the increased payments because of concerns about adding to the federal deficit, while others have argued the payments would not be targeted since some checks would go to people who haven’t lost their job or income during the pandemic.
But Democrats argue that the more-direct assistance to Americans is needed at a time when many are struggling to cover basic expenses.
According to an analysis released Thursday by the left-leaning Institute on Taxation and Economic Policy, people in the bottom 60 percent of income would on average see their income rise by 11 percent with the $2,000 payments floated in the House bill, compared to a 3 percent increase with only a payment of $600.
Trump on Wednesday criticized GOP leaders for opposing increasing the payments to $2,000.
“How does that play politically?” Trump said at a rally that preceded riots at the Capitol. Trump added that he thinks the resistance to $2,000 checks was “one of the primary reasons” why the Republicans lost in Georgia.
The exact timing of Democratic legislation to boost the check amounts is unclear, but passage is highly unlikely before Inauguration Day.
At this early stage, there are other questions about the legislation.
One big one is whether Democrats would propose increasing the recent $600 payments to $2,000 or create a new round of $2,000 payments.
The House-passed bill from late last month, which would need to be passed again in the current Congress for it to move forward, would have increased the $600 payments to $2,000 and would have made adult dependents eligible for the payments. The IRS has already issued most of the $600 payments, and progressives are likely to push for as much assistance to Americans as possible.
Another key question is whether Democrats will seek a vote on stand-alone legislation for direct payments or if the checks would be wrapped into a broader coronavirus relief package. Schumer this week declined to say what route Democrats would take.
Once they have control of Congress, Democrats will have the ability to pass legislation using the budget reconciliation process that would allow them to pass certain measures with a simple majority. Lawmakers tend to reserve reconciliation for larger packages of legislation.
Outside of reconciliation, legislation needs 60 votes to clear the Senate, and Democrats will have 50 seats once Warnock and Ossoff are sworn into office. While several GOP senators have come out in support of boosting the direct payments, it’s unclear whether a stand-alone bill would clear the 60-vote threshold.
Democrats will also have to decide whether they want to make any changes to the eligibility requirements for the payments.
Russ Sullivan, a former staff director for Democrats on the Senate Finance Committee who now chairs the national tax policy group at Brownstein Hyatt Farber Schreck, said some Democratic lawmakers may not want too much of the cost of a broad coronavirus relief package to be taken up by the checks. The House-passed bill from December was estimated to cost about $464 billion.
“There will be Democrats who don’t want the supplemental checks to squeeze out other COVID recovery provisions,” said Sullivan. “The most logical way to reduce the cost would be to reduce the eligible income phase-out points.”