Democrats released yet another proposal for a coronavirus economic relief package on Tuesday — a $3 trillion bill with more money for enhanced unemployment benefits, money for state and local governments, and funding for a host of other Democratic priorities.
Of importance to most Americans: The bill, called the Health and Economic Recovery Omnibus Emergency Solutions, or HEROES, Act, includes a second wave of $1,200 payments to the vast majority of U.S. households — this time with even more inclusive eligibility rules than the previous payments. Benefits would go to immigrants and would be protected from garnishment by banks and other debt collectors.
Previous income thresholds would remain the same, but instead of $500 per dependent like the last round, the new proposal offers $1,200 ― with families capped at receiving $6,000.
The bill also extends the extra $600 per week for unemployment through the end of the year. The extra $600 from the federal government — designed as a lifeline to many of the 33 million unemployed — is currently scheduled to expire at the end of July, and Republicans have said they’ll oppose any effort to keep the full amount past then out of concern that it disincentives work.
This bill, almost certain not to be the final legislation that will become law, is an opening offer from Democrats. On past coronavirus relief bills, House Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) negotiated in private with Senate Majority Leader Mitch McConnell (R-Ky.) and Treasury Secretary Steve Mnuchin.
This time, with McConnell saying he doesn’t see the “urgency” for another measure, Democrats are moving forward with their own bill — one that more closely hews to their priorities.
For instance, Democrats are again trying to pass real paid sick leave provisions, after seeing their proposals gutted by Senate Republicans and the White House back in March. They aim to provide state and local governments with $1 trillion, and set aside $200 billion for essential workers.
But the bill isn’t entirely focused on helping the most needy or deserving.
Democrats are also offering to undo one of the few tax increases Republicans implemented in their 2017 tax bill with a provision allowing homeowners to write off state and local taxes (SALT) above $10,000. That tax cut would be highly regressive; the Tax Policy Center estimates that the richest 1% of households would receive 56% of the benefit of that change, and the top 5% would get 80%.
The so-called SALT deduction tax increase angered even some Republican and independent voters in richer parts of the country, and it was a key reason Democrats were able to win many long-held GOP seats in areas like New York and Orange County, California. But it’s less than the most important priority in a coronavirus response bill, though it could set up another partisan blame game if it’s Republicans who insist on stripping that provision.
Of course, the bill is not all politics.
Proposals To Combat COVID
House Democrats are proposing a number of common-sense ideas to help combat the actual coronavirus pandemic. They aim to pour money into hospitals, and they want to expand health care benefits past the free coronavirus testing Congress passed in March.
Access to affordable health insurance has largely been left out of negotiations between the White House and Congress, leaving millions of recently unemployed Americans — and previously uninsured Americans — in the lurch during a public health crisis. This bill would make treatment for the novel coronavirus free for individuals, as well as open a special enrollment period for previously uninsured individuals to buy into the Affordable Care Act’s exchanges.
It also would increase how much the federal government pitches in for state Medicaid programs and subsidizes COBRA, the federal program that lets recently laid-off Americans continue their former employer’s health insurance plan at personal cost. COBRA is rarely an affordable option for recently unemployed Americans because of the high costs of private insurance, which are typically subsidized by employers. This proposal would cover the entire cost of an individual’s private insurance premium with federal dollars.
It’s unclear whether these proposals will have much bipartisan support. Republicans have shown little appetite to negotiate on another relief package. The Trump administration decided against reopening the Obamacare exchanges during the early days of the pandemic in March, and despite promising to cover health care costs for uninsured Americans through a hospital fund, the administration has yet to set up a system to do so.
Criticism From The Left
But already, Democrats are facing criticism from progressives for focusing their health care subsidies through COBRA, which would direct federal funds toward more expensive private insurance plans, rather than expanding public programs like Medicare and Medicaid, which pay health care providers much lower rates.
The absence of a more robust expansion of health care is one of several provisions in the bill that is already disappointing progressive lawmakers and activists.
The legislation also includes a subtle change in language that would make some Washington lobbying firms eligible for forgivable loans from the Paycheck Protection Program, which is designed to help small businesses retain their employees despite the economic fallout from the COVID-19 pandemic. Specifically, the bill allows a host of previously excluded nonprofits, including the political advocacy groups known as 501(c)(4)s and trade associations that lobby for groups of corporations, to access those PPP small business loans.
Anti-corruption advocates lament the inclusion of trade associations in the new bill because the corporations and other institutions that bankroll them are often already eligible for federal bailout money. The organizations, which enjoy significant clout in Washington, had been pushing for the change with the support of some Democratic lawmakers.
“Including trade associations as eligible for PPP loans is in many cases allowing double-dipping in the federal assistance program,” said Craig Holman, a lobbyist for Public Citizen, which monitors corporate influence in Washington.
The bill is also a disappointment for many progressives on another key piece of getting the economy up and running again: child care. Advocates and some lawmakers were looking for an additional $50 billion to stabilize child care providers, many of whom are struggling to survive amid closures. The bill released Tuesday would provide just $7 billion.
More Stimulus Checks
But overall, there is plenty for liberals to like in a bill that would cost an estimated $3 trillion.
There is $175 billion for housing assistance to help eligible people pay rents and mortgages, $25 billion for the struggling postal service, and a 15% increase in food benefits provided under the Supplemental Nutrition Assistance Program.
The additional round of stimulus checks will likely make the legislation popular with many Americans, and items like expanded unemployment and paid sick leave could be an important salvation for many.
Specifically, the new bill would close the immense loopholes on paid sick leave and family leave that the White House and Senate Republicans put into the second stimulus bill, the Families First Coronavirus Response Act.
Trying Again On Leave
Workers at companies with more than 500 employees were blocked from getting paid sick or family leave through the law, and very small companies were allowed to voluntarily opt out of providing leave. That meant that up to 83% of the workforce was unable to actually get paid time off through that bill, according to one recent analysis from the National Partnership for Women and Families.
The lackluster provisions led to many workers simply leaving their jobs to deal with COVID-related issues.
This new bill would cover everyone, offering two weeks of paid time off for workers battling coronavirus and 12 weeks time off — capped at two-thirds of pay — for a variety of reasons. And these provisions would be extended through the end of 2021, a year past the expiration date set in the previous bill.
Paid leave advocates told HuffPost they were thrilled to see House Democrats try again to pass these measures.
“Big picture, it restores all the things we wanted,” said Shilpa Phadke, the vice president of the Women’s Initiative at the Center for American Progress, who’s been pushing to close the loopholes in the previous stimulus packages.
A strong paid sick leave provision is going to be critical in reopening the economy, Phadke pointed out.
No one is going to want to work at a place where employees are forced to work through illness ― and people aren’t going to want to shop at stores, or eat in restaurants, where workers are coming in sick, either. “There’s a basic confidence issue here,” she said.
When McConnell was asked about the legislation Tuesday, during a time of massive unemployment and more than 1,000 deaths a day due to the coronavirus, he had a simple message.
“This is no time for aspirational legislation,” he said.
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