Washington — Senate Majority Leader Mitch McConnell is set to unveil a massive spending package to respond to the economic fallout of the coronavirus outbreak as early as Thursday, the third phase of the legislative response to the pandemic that has killed thousands around the world and tanked financial markets.
While the details remain in flux, the “phase three” package is expected to cost upwards of $1 trillion, and include provisions to send direct cash payments to every American. In a memo laying out the administration’s request, the Treasury Department asked for two rounds of direct cash payments to taxpayers, worth $250 billion each. The first payment would be made April 6, and the second would come on May 18 if the crisis hasn’t abated.
Treasury Secretary Steven Mnuchin said in an interview with Fox Business Thursday morning that the administration would like to see $1,000 checks sent to every adult and $500 for every child, with up to $3,000 provided for a family of four. According to the Treasury memo, these payments would be “fixed and tiered based on income level and family size.”
“I think it’s clear we don’t need to send people who make a million dollars a year checks,” Mnuchin told reporters earlier in the week.
The administration’s request also includes $300 billion in small business loans, $50 billion for the beleaguered airline industry and $150 billion for other “severely distressed” industries. The small business loans would apply to employers with 500 or fewer employees, and cover 100% of six weeks of payroll. Businesses must compensate all employees for eight weeks from the time the loan is disbursed in order to qualify.
The document outlining the administration’s request was first reported by The Washington Post, and a senior administration official confirmed its contents to CBS News.
McConnell has tasked three working groups to develop the proposed phase three legislation, which will serve as the jumping-off point for negotiations with Democrats. In an interview with CNN on Wednesday, Senate Minority Leader Chuck Schumer said there was “a lot of overlap” between what the administration wants and what congressional Democrats would like, but stressed the importance of strengthening protections for workers.
“The one thing I did tell [Mnuchin] as well, though, if there are going to be some of these corporate bailouts, we need to make sure workers and labor come first. That people are not laid off. That people’s salaries are not cut,” Schumer said. Many Democrats remain concerned that a phase three bill would not do enough to assist those laid off as businesses shutter across the country.
Congressional efforts to address the impacts of the coronavirus come amid the first indications that the outbreak is prompting widespread job loss on a scale not seen since the 2008 financial crisis. The number of people filing for unemployment benefits shot up last week, an increase that is “clearly attributable to impacts from the COVID-19 virus,” according to the Department of Labor. In the week ending on March 14, the number of jobless claims was 281,000, an increase of 70,000 from the previous week.
As the pandemic shuts down business across the county, the surge in newly laid off workers is crashing states’ unemployment websites. In Ohio alone, more than 48,000 people applied for jobless benefits during the first two days of this week — 26 times the amount from the week before.
As of Thursday morning, there were over 9,400 reported cases of the coronavirus across every state, and more than 150 patients have died.
Mr. Trump signed the “phase two” bill, which provides free testing and paid leave for certain workers, late Wednesday evening, hours after it was passed in the Senate by a bipartisan vote of 90 to 8.
Irina Ivanova contributed to this report.
