Happy Thursday and welcome back to On The Money, where we’re Ushering in a new federal holiday. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.
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THE BIG DEAL—Sanders: Democrats considering $6 trillion spending package: Senate Budget Committee Chairman Bernie Sanders (I-Vt.) confirmed to reporters Thursday that Senate Democrats are discussing a $6 trillion budget reconciliation proposal that would also expand Medicare and lower the cost of prescription drugs.
Sanders on Thursday said the proposal builds on President Biden’s American Jobs Plan and American Families Plan.
“Yeah, absolutely,” Sanders said when asked whether Democrats are discussing going it alone on a proposal as big as $6 trillion.
- “The president has given us a framework, I think it’s a comprehensive and serious framework. It is the function of the Congress now to take that framework and go with it,” Sanders told reporters.
- Sanders said the goal of the reconciliation package would also address what he called the “housing crisis”—a sharp increase in homelessness and shortage of affordable housing exacerbated by COVID-19.
The Hill’s Alexander Bolton has more here.
Moderates balk: It should not surprise you to find out that an ambitious multi-trillion spending package spearheaded by Bernie Sanders isn’t getting many moderates excited.
Asked whether he could support a $6 trillion reconciliation proposal of which half would be paid for, according to reports by Politico and Bloomberg, Sen. Jon Tester (D-Mont.) said flatly, “No.”
“The way you just described it? Nothing personal but no,” he said to a reporter. “The key is, this is is like the defense budget, it’s not how much, it’s how it’s utilized that’s important,” he said.
Republicans push for more defense spending: Speaking of the defense budget, Senate Republicans negotiating spending levels for 2021 have accepted President Biden’s $1.5 trillion price tag for discretionary spending, and are now focused on allocating more of those funds toward the Pentagon.
“My goal is to get more money for defense. We live in a tough world,” Sen. Richard Shelby (Ala.), the top Republican on the Senate Appropriations Committee, told The Hill.
“The allocations will shift around, but at the end of the day, there’s going to be a struggle for national security.”
Asked if the negotiation was limited to the allocation, rather than attempting to bring down the $1.5 trillion overall spending figure, Shelby replied, “I think that’s fair.”
The Hill’s Niv Elis tells us more about the road ahead.
LEADING THE DAY
Yellen on the Hill, Part II: Treasury Secretary Janet Yellen testified before Congress on Thursday about President Biden’s budget for the second day in a row, facing questions from lawmakers on the House Ways and Means Committee on a host of topics, including unemployment benefits, inflation and Biden’s tax proposals. Here’s a breakdown from The Hill’s Naomi Jagoda:
- Yellen said that there are “no plans” to extend the $300 per week boost to unemployment benefits that expires in September, after some congressional Democrats have also signaled that they’re willing to let the enhancement end. Yellen said that prior to the September expiration date, “states should have the flexibility to do what’s appropriate for their circumstances.” She noted that some states have high unemployment rates and may want to continue providing the enhanced benefits until they expire.
- Yellen said she’s “very optimistic“ that there will be a broad consensus on a global minimum tax, after the countries in the Group of Seven recently endorsed a minimum tax of at least 15 percent.
- The Treasury secretary said that the recent increase in inflation follows a period during the pandemic in which prices collapsed in certain areas, such as the hospitality sector. “Part of the high inflation we’ve seen in recent months reflects some of the same places,” she said.
- Yellen touted Biden’s American Jobs Plan and American Families Plan, which would make investments in areas such as transportation and child care that the president proposes to pay for through tax increases on the wealthy and corporations. She said that the White House hasn’t supported a wealth tax but has proposed a “different approach” that would lead to wealthy individuals paying more in taxes on capital gains.
Weekly jobless claims rise for first time since April: New weekly applications for unemployment insurance rose last week for the first time since April, according to data released Thursday by the Labor Department.
- In the week ending June 12, seasonally adjusted initial jobless claims totaled 412,000, rising by 37,000 from the previous week’s revised level of 375,000.
- Claims had fallen in every consecutive week since the week ending May 1 before last, setting a series of new post-lockdown record lows.
- The number of new applications for Pandemic Unemployment Assistance also jumped by 46,722 to a total of 118,025 last week. The program, which is set to expire in September, extended jobless aid to gig workers, contractors and others who don’t qualify for traditional unemployment insurance.
What it means: Honestly, maybe not much at all. The uptick in jobless claims was a surprise after weeks of steady declines and a growing number of job openings available for unemployed workers. Even so, labor market experts said Thursday that the increase is no cause for concern.
Why? Analysts and government watchdogs have warned throughout the pandemic that backlogs and inconsistent reporting timelines among state unemployment offices have distorted the actual number of jobless claims.
GOOD TO KNOW
- The CEO of Bank of America on Thursday said the company’s “vision” is to have all vaccinated workers back in the office after Labor Day.
- The National Republican Congressional Committee (NRCC) will begin soliciting cryptocurrency donations, it announced on Thursday, making it the first national party committee to do so.
- Microsoft is facing new pressure from investors over its development and sale of surveillance technologies to law enforcement and its efforts to shape the policies regulating their deployment.
ODDS AND ENDS
- Senate Majority Leader Charles Schumer (D-N.Y.) vowed he “will not pass” an infrastructure package that removes the climate provisions of President Biden’s American Jobs Act.
- Coronavirus patients enduring long-term symptoms are joining a campaign to lobby Congress on passing legislation that would provide paid family leave for all workers.