WASHINGTON (AP) —The Treasury Department wants to start issuing direct payments to Americans by early next month as the centerpiece of a $1 trillion plan to stabilize the economy as the coronavirus epidemic threatens a body slam to taxpayers and businesses.
In a memorandum issued Wednesday, Treasury is calling for two $250 billion cash infusions to individuals: A first set of checks issued starting April 6, with a second wave in mid-May. The amounts would depend on income and family size.
The Treasury plan, which requires approval by Congress, also recommends $50 billion to stabilize the airlines, $150 billion to issue loan guarantees to other struggling sectors, and $300 billion to for small businesses. The plan appears to anticipate that many of the loans would not be repaid.
The details are for the third coronavirus response bill that lawmakers hope to pass next week. It comes as the Senate turned Wednesday to a House-passed coronavirus response bill.
The Treasury outline provides a basis for lawmakers to work from in an unprecedented government response and is likely to be broadened to include additional emergency funding for federal agencies.
The price tag for the upcoming economic package alone promises to exceed Treasury's $1 trillion request, a rescue plan not seen since the Great Recession. Trump wants checks sent to the public within two weeks — a huge logistical task — and is urging Congress to pass the eye-popping stimulus package in a matter of days. A more realistic timeframe is next week.
As analysts warn the country is surely entering a recession, the government is grappling with an enormous political undertaking with echoes of the 2008 financial crisis.
Wednesday's legislation would speed the delivery of testing for the virus and provide paid sick leave to workers, but the focus in Washington has already moved to development of a far, far larger response bill that would inject hundreds of billions of dollars into the faltering economy, provide relief to shuttered businesses, and help keep airlines from going under.
At the Capitol on Wednesday, Senate Majority Leader Mitch McConnell prepared his colleagues for unprecedented steps to deal with the epidemic's body slam to the economy.
“I will not adjourn the Senate until we pass a far bolder package,” McConnell said. “We aren't leaving until we deliver.”
But first, McConnell said, the Senate will vote on a House-passed package of sick pay, emergency food and free testing, putting it back on track for Trump's signature — despite Republican objections over the potential impact on small businesses saddled with a new mandate to pay sick leave — subject to reimbursement from the government.
“We're going to vote to pass the House bill, but it's imperfections will just make our more comprehensive package more urgent," McConnell said.
Overnight, the White House sent lawmakers a separate $46 billion emergency funding request to boost medical care for military service members and veterans, fund production of vaccines and medicines, build 13 quarantine centers at the southern border for migrants, make federal buildings safer, and reimburse Amtrak for $500 million in anticipated revenue losses, among other purposes.
The Trump request also reverses cuts to the Centers for Disease Control and National Institutes of Health that Trump proposed in his February budget for next year and would create a $3 billion fund for unanticipated needs.
Economists doubted that the massive economic rescue package being drafted would enough to stop millions of jobs losses, even if in the short term.
The as-yet-unreleased measure is on a par with $700 billion 2008 bank bailout or the nearly $800 billion 2009 recovery act. The White House proposal aims to provide a massive tax cut for wage-earners, $50 billion for the airline industry and $250 billion for small businesses. But nothing is set in concrete, and all the pressure is for the package to keep growing.
The amount that would be sent out in checks Americans is also not yet decided. The White House said it liked GOP Sen. Mitt Romney's idea for $1,000 checks, though not necessarily at that sum and not for wealthier people.
Senate Democrats produced their own $750 billion proposal, which includes $400 billion to shore up hospitals and other emergency operations in response to the global pandemic and $350 billion to bolster the safety net with unemployment checks and other aid to Americans.
“The aid has to be workers first," said Senate Minority Leader Chuck Schumer, not what happened in 2008, when the big banks took precedence. Schumer also said it's time to call out the National Guard to provide security as communities reel from the crisis.
A roster of America's big and small industries — airlines, hotels, retailers and even casinos — lined up for hoped-for aid.
For most people, the new coronavirus causes only mild or moderate symptoms, such as fever and cough. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia.
The vast majority of people recover from the new virus. According to the World Health Organization, people with mild illness recover in about two weeks, while those with more severe illness may take three to six weeks to recover.
Still, health officials are urging Americans to stay home to prevent an onslaught of cases that could overwhelm hospitals as happened in Italy, among the countries hardest hit.
House Speaker Nancy Pelosi, who marshaled the earlier package through a bipartisan vote last week, fielded a call from Mnuchin on Tuesday morning and another from Federal Reserve Chairman Jerome Powell in the afternoon, encouraged by the Fed chairman’s perspective that Congress could think big with interest rates at nearly zero.
In the call with Mnuchin, she and Rep. Peter DeFazio, D-Ore., chairman of the House Transportation committee, “emphasized that protecting workers' paychecks and benefits was their top priority, and that immediate action was needed,” said Pelosi spokesman Drew Hammill on Twitter.
The debate is sure to revive the sharp divisions over the costly bank bailout and economic recovery of the Obama and Bush eras.
Much about the proposed checks is not known, such as whether the amount would vary by the income of the recipient or whether everyone would get the same sum. Mnuchin said “it's clear we don't need to send people who make $1 million a year checks, OK?”
Economists from both parties endorsed mailing checks of at least $1,000 to all American households as the quickest way to offset the sharp slowdown in economic activity.
"We need to pay people to stay at home," said Heidi Shierholz, a senior policy analyst at the Economic Policy Institute, a liberal think-tank. The group predicted that without a huge stimulus package, the U.S. economy could lose three million jobs by this summer.
Still, some GOP senators were skeptical about the massive aid on the table. “I’m going to be very leery of doing something like in 2008,” said Indiana Republican Sen. Mike Braun.
“Right now, the plan around here is basically to just to start shoveling money out of a helicopter," said Sen. Ben Sasse, R-Neb. “This is a bad idea. … We don’t need a policy where Washington, D.C., handpicks winners and losers.”
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Washington (AP) —President Donald Trump wants the government to send checks to Americans in the next two weeks in an effort to curb the economic cost of the coronavirus outbreak, Treasury Secretary Steven Mnuchin said Tuesday.
“The president has instructed me we have to do this now,” he said at the White House briefing. He didn't give details except to say the amount should be significant and millionaires would not get it.
The White House on Tuesday was asking Congress to approve a massive emergency rescue package to help businesses as well as taxpayers cope with the economic crisis that is paired with the pandemic.
Mnuchin planned to outline that roughly $850 billion package to Senate Republicans at a private lunch, with officials aiming to have Congress approve it this week. Senate Majority Leader Mitch McConnell, opening the Senate on Tuesday morning, promised swift action.
The White House was asking Congress on Tuesday to approve a sweeping emergency stimulus package to help businesses and taxpayers cope with the economic fallout of the coronavirus pandemic. It's the most far-reaching economic rescue package since the Great Recession of 2008.
Treasury Secretary Steven Mnuchin planned to outline the roughly $850 billion package to Senate Republicans at a private lunch, with officials aiming to have Congress approve it this week.
Senate Majority Leader Mitch McConnell, opening the Senate on Tuesday morning, promised swift action.
“The Senate will not adjourn until we have passed significant and bold new steps above and beyond what the House has passed to help our strong nation and our strong underlying economy weather this storm," McConnell said.
Bigger than the 2008 bank bailout or the 2009 recovery act, the White House proposal aims to provide a massive tax cut for wage-earners, $50 billion for the airline industry and relief for small businesses.
Two people familiar with the request described it to The Associated Press on the condition of anonymity because they weren't authorized to speak publicly.
“There's great spirit” among lawmakers, President Donald Trump said at the White House briefing Tuesday as he outlined several elements of the rescue plan. “I can say that for Republicans and Democrats.”
But it's an enormous political and economic undertaking as a slow-moving Congress tries to rise to the occasion of these fast times.
The debate is sure to revive the sharp divisions over the costly bank bailout and economic recovery of the Obama and Bush era. Particularly striking is McConnell's urgency after having adjourned the Senate over the weekend while House Speaker Nancy Pelosi muscled through an aid package.
Angry senators from both parties boarded planes returning to a changed Washington, as Trump declared a state of emergency, the virus spread and the economic free-fall worsened.
The White House hopes the measure will pass quickly, possibly this week, an enormous political undertaking as the administration scrambled to contain the economic fallout of the severe disruptions to American life from the outbreak.
White House officials offered senators a preliminary briefing late Monday at the Capitol, saying they want the plan approved by Congress as soon as possible, suggesting in a matter of days.
“ASAP,” White House economic adviser Larry Kudlow said late Monday. “There's an urgency.”
The rush to inject cash and resources into the economy is an effort unlike any since the 2008 economic crisis, with political and economic interventions and eye-popping sums to try to protect Americans from the health and financial fallout.
The new proposal is beyond the House 's estimated $100 billion aid package of sick pay, emergency food aid and free virus testing that was approved over the weekend and is pending before the Senate.
Now Congress will be rushing to pass two — a massive, sweeping response to the virus outbreak that is rewriting America's way of life.
Muscling the aid will test Congress and the White House at a pivotal moment in the crisis and in an election year when the two parties have vastly different outlooks on the best way to prop up the economy and help Americans.
Senate Democrats have proposed their own $750 billion package — boosting hospital capacity and unemployment checks for the suddenly jobless — with deep negotiations to come.
All sides — the House, Senate and White House — agree more federal resources are needed to handle what's coming.
At the start of the month, Congress approved $8.3 billion in initial aid. Trump quickly signed into law the measure, which provided federal agencies money for vaccines, tests and potential treatments, and funding to help state and local governments respond to the threat.
During the recession, the American Recovery and Reinvestment Act of 2009, passed in February of that year, had an initial price tag of $787 billion which was revised later to $831 billion. That was under Barack Obama.
The Tarp passed in the fall of 2008 to help troubled banks had a price tag of $700 billion. It was put together by the George W. Bush administration, and provided money for the auto bailouts for General Motors and Chrysler. All of that money for the banks and the auto companies was paid back.
Now, Republicans often reluctant to spend federal dollars did not flinch at the head-spinning number, as a roster of America's big and small industries — airlines, hotels, retailers — lined up for aid.
Sen. Mitt Romney, R-Utah, called for sending $1,000 to every adult American.
The president conveyed that lawmakers should “not be impeded by the price tag,” said Eric Ueland, the White House legislative director.
Industries representing a broad swath of the economy are seeking help in withstanding the fallout as schools close and Americans are being told they should stay inside, skip nonessential travel and avoid gatherings with 10 people or more.
That means no dining out, no boarding planes, no shopping the malls as a great national shutdown sparks business closures, layoffs and lost paychecks for rents, mortgages and everyday needs.
The nation's largest business organization, the U.S. Chamber of Commerce, asked the Trump administration and Congress on Monday to act rapidly to help companies have access to cash and avert a “potentially devastating” hit to the economy.
The request from the U.S. airlines alone could easily top $50 billion, according to Airlines for America, the trade group representing the carriers.
Pulling together the new package will challenge the basic logistics of governing as Congress itself struggled to adapt to the new normal.
House Democrats were told on a conference call they won't be recalled to Washington until the next package is ready for action, according to people familiar with the call but unauthorized to discuss it and granted anonymity.
The 100-member Senate convened for an evening vote — in the new era of social distancing. While different authorities around the country have issued conflicting advice, the Trump administration said that Americans should not gather in groups of more than 10 people over the next 15 days. All older people are asked to stay at home.
The No. 2 Senate Democratic leader, Dick Durbin of Illinois, counting the number of senators on the floor, questioned what example they were setting. He urged swift passage of the House package. “What are we waiting for?” he asked.
For most people, the new coronavirus causes only mild or moderate symptoms, such as fever and cough. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia.
The vast majority of people recover from the new virus. According to the World Health Organization, people with mild illness recover in about two weeks, while those with more severe illness may take three to six weeks to recover.
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