Relief bill stalls in Congress; who will get blamed?

$600 extra weekly benefits, evictions on the brink

The extra $600 a week of unemployment benefits and eviction moratorium that have kept millions of households afloat and in their homes while shut out of their livelihoods by Covid-19 are ending on July 31, and Congress has failed to extend them.

Everyone agrees on more relief, but Democrats and Republicans are far apart on details, and negotiations have bogged down. With elections less than 100 days away, finger-pointing has broken out.

For an update on the status of negotiations and negotiating positions of the parties, go here.

The Democratic-controlled House passed a $3 trillion wish list two months ago that would retain the $600 weekly enhanced benefits, which are on top of state unemployment benefits (which vary by state), for the rest of this year. It also includes money for state and local governments, who’ve suffered severe revenue declines; hazard pay and child care assistance for essential workers; money for testing and contact tracing; mortgage and rent assistance; money for the postal service and local elections; farmer aid, student loan relief, and other provisions; and of course an extension of the moratorium on evictions.

Senate Republicans want to hold down the package to $1.0 to $1.3 trillion, with many pushing for the lower end. Democrats probably are resigned to those limits, but will press for the higher $1.3 trillion amount. Right now it looks like the final figure, if a deal is struck, will be closer to the lower amount.

McConnell and his crew kept the GOP proposal under wraps and sprung it on the Democrats a few days before the existing relief expired. It was an ambush designed to force Democrats to swallow it without debate or negotiation. But the Democrats didn’t take the bait, and the deadline will pass without a bill being passed.

Another reason for the delay was splits within the GOP over details, both within the GOP Senate caucus, and between the GOP Senate and White House. The latter are being ironed out. But McConnell says he doesn’t have unity in his own caucus, or the votes to pass a bill. And there’s the problem of bringing together the Democratic House and the GOP Senate before any bill can be sent to Trump for the President’s signature.

Trump will be under great pressure to sign it. He wants no aid for state and local governments, but some Republicans support and Democrats insist on it, and he wanted no money for testing and contact tracing, which is politically untenable. Trump has to bend, and facing sinking polls and in fear of his political life, he will.

Republicans would go along with supplementing state unemployment benefits a while longer, but are offering only 3 more months, and want to drastically reduce these payments to push workers back into jobs. Some want to cut it from $600 to $200 a week, while another faction has floated setting it at 70% of a worker’s pre-Covid wages. Cutting these benefits is a big deal for them; they gripe that some workers get more from unemployment benefits than from working, which is making it hard for employers to get people to come back to work.

Democrats believe the number of such recipients is small, and irrelevant in any case. They’ve argued against reopening the economy too soon. They see this as forest vs. trees. In their view, what matters is getting money into the economy, not fine-tuning how much individuals get. They’re arguing for speed and simplicity. They point out that tying benefits to a percentage of wages won’t work because it’s too complicated for states to administer with their antiquated computer systems.

Republicans are adamant about protecting employers from lawsuits by workers who get sick on the job. This is also a hot button issue for Democrats, who don’t want workers forced into dangerous working conditions, or left in the lurch if they get sick on the job. It’s the biggest sticking point in the negotiations between the parties. Is a compromise possible? Maybe, given the pressure to get something done.

It’s not lost on Democrats that protecting employers from liability is a disincentive to providing Covid-safe workplaces. They should insist on conditioning any legal immunity on complying with CDC workplace guidelines, the government taking care of workers who get ill by returning to work if employers can’t be made to, and adding more money for this. These are reasonable demands that Republicans should agree to.

What are the chances of something not passing? You can bet politicians on both sides are penciling out cynical calculations of who will get blamed if Congress doesn’t ride to the rescue of the suffering American people. With Republicans staring at a possible election rout, my guess is they’ll crack before the Democrats do, but the latter will have to make significant concessions. There’s risk of miscalculation for both sides, but I think Republicans are more likely to antagonize voters.

They apparently realize this. They want to break up the package and pass the pieces the two parties can agree on. Democratic leaders in both House and Senate are saying no to this, and insisting on a comprehensive package. One assumes they believe this gives them more leverage over the final package. I believe something will happen in the next few days, but I’m not sure what.

Photo: The U.S. Senate chamber

0 Comments Add Yours ↓

  1. Mark Adams #

    Appears Congress is working as designed. How about a bottle of old compromise?

    Meantime it is Governor’s Ensley’s fault.

  2. Roger Rabbit #

    Compromise is a fine idea, and how the system should work, but it’s achieved by negotiating. When will Republicans begin negotiating with Democrats? They just got this bill. What concessions will Republicans make in exchange for Democratic concessions? Where’s the middle ground where they can come together? These are all unanswered questions right now.