Lawmakers are gearing up to negotiate yet another coronavirus relief package to curb the pandemic-induced economic downturn.
Congress is scheduled to go back to work on Monday. With this, a new round of coronavirus relief is at the top of their legislative agenda. However, it’s going to take some major compromises to get something done. Democrats are eager to keep the country locked down so they can pin the resulting economic disaster on President Trump, but Republicans want to get things open as soon as possible. With a presidential election right around the corner, the stakes couldn’t be higher. If congress passes this bill, it will serve as the fifth round of pandemic relief spending to pass Congress.
Expected Plans of Action
Republican congressional leadership will meet with President Trump at the White House on Monday morning. House Minority Leader Rep. Kevin McCarthy (D-CA) and House Majority Leader Mitch McConnell (R-KY) are both expected to be in attendance. According to unnamed sources close to the matter, the GOP leaders aim to discuss the Republican plan for the next stimulus package.
Meanwhile, Democrats have their own ideas about the next round of coronavirus relief spending. Unsurprisingly, their approach centers on keeping the country locked down while the government hands out more money. They specifically want to extend the expanded CARES Act unemployment benefits. These benefits will expire at the end of July. Democratic leaders have also hinted some of their interest in sending out another round of $1,200 stimulus checks.
Conversely, Republicans have been hesitant to extend the added $600 weekly benefit because many economists believe it’s incentivizing people to stay home instead of returning to work. A recent study found that the average unemployment recipient is making 32% more from their benefits than they did from their typical paycheck. Obviously, most people would rather receive money staying home rather than work, especially when they receive more pay to do it. Currently, the government is paying out $15 billion per month to cover the cost of the expanded benefits.
Many Americans say the money is a vital lifeline, but this is a seemingly dysfunctional approach to rebooting the economy. Instead, many expect Republicans to favor a strategy that incentivizes people to return to work. Although specifics remain unavailable, rumors indicate that a temporary stay on payroll taxes and a back-to-work bonus are some of the approaches being considered.
Cutting Payroll Taxes and Protecting Businesses
— First Squawk (@FirstSquawk) July 19, 2020
President Trump is a strong advocate of cutting payroll taxes. In fact, on Sunday he told Fox News’ Chris Wallace that he might veto another coronavirus aid package if it doesn’t include a payroll tax cut. “I’ll have to see but, yeah, I would consider not signing it if we don’t have a payroll tax cut.”
Republicans also want to include liability protections for businesses in the next coronavirus relief package. Many businesses are hesitant to reopen due to potential liabilities for a coronavirus outbreak at their establishment, and Republicans believe the government needs to set clear terms in order to give business owners some element of certainty regarding their legal liabilities.
During his weekend interview with Chris Wall, President Trump also stressed the need for liability protections. “We do need protections because businesses are going to get sued just because somebody walked in,” said President Trump. “You don’t know where this virus comes from. They’ll sit down at a restaurant. They’ll sue the restaurant, the guy’s out of business.’’
Ultimately, it comes down to this. The Democrats want to keep the country locked down, and the Republicans want to open it back up. How both sides will come to a compromise remain unclear. However, with the CARES Act unemployment benefits set to expire at the end of the month, the clock is ticking.