The President’s Chief of Staff, Mark Meadows, and Treasury Secretary Steven Mnuchin have continued talks with Senate Minority Leader Chuck Schumer and Speaker of the House Nancy Pelosi since last Friday on another economic relief package. Initially the Republicans offered to extend the current unemployment benefits for one week to allow more time for negotiations on a final bill. This offer was rejected by Schumer and Pelosi as have other compromise offers put up by the Republicans. If anything, the Democrats have raised the $3 trillion price tag on their demands, asking more money for schools in preparation for fall classes. The Democrat-controlled House passed their bill in May, the HEROES (Health and Economic Recovery Omnibus Emergency Solutions) Act. One of the main points of contention between the Democrats and Republicans is over the amount of federal unemployment being provided (in addition to state unemployment benefits). The CARES Act passed by Congress in late March provided for $600/week in federal unemployment through the end of July. When added to state benefits the average worker was receiving about $930 a week. Some employers complained that this so-called “enhanced unemployment” was inhibiting many of their employees from returning to work. A University of Chicago study found that 2/3 of workers on unemployment were receiving more than they did at their prior job. The Democrats proposed extending the full $600/week through the end of 2020 whereas the Republicans wanted to reduce those payments to a lesser amount ($400/week). One proposal suggested keeping the $600 in place as long as unemployment remained above 10 percent and gradually lowering the amount as employment rebounded. The CARES Act was scheduled to end by August 1 since lawmakers believed infection numbers would be substantially less by that time. Unfortunately the virus is not behaving as expected.
It appears obvious that some additional federal payments may be necessary for several more months. This is an election year and if nothing is passed President Trump and the Republicans will likely be blamed for the inaction. Chuck Schumer and Nancy Pelosi are not interested in negotiating for that reason. The HEROES Act passed by the House is loaded with $2 trillion of items mostly unrelated to the crisis at hand. Pelosi believes in the political dictum, “never let a crisis go to waste.” Some of the items could be difficult for Republicans to swallow such as: provides FY2020 emergency supplemental appropriations to federal agencies; provides payments and other assistance to state, local, tribal, and territorial governments; provides additional direct payments of up to $1,200 per individual; expands paid sick days, family and medical leave, unemployment compensation, nutrition and food assistance programs, housing assistance, and payments to farmers; modifies and expands the Paycheck Protection Program, which provides loans and grants to small businesses and nonprofit organizations; establishes a fund to award grants for employers to provide pandemic premium pay for essential workers; expands several tax credits and deductions; provides funding and establishes requirements for COVID-19 testing and contact tracing; eliminates cost-sharing for COVID-19 treatments; extends and expands the moratorium on certain evictions and foreclosures; and requires employers to develop and implement infectious disease exposure control plans. The bill would also modify or expand a wide range of other programs and policies affecting: Medicare & Medicaid: health insurance: broadband service: medical supplies immigration: student loans & financial aid: the federal workforce: prisons: veterans benefits: consumer protection requirements: the U.S. Postal Service: federal elections: aviation & railroad workers: pension & retirement plans. Trump should take a page from Obama and start making his own laws until challenged in the SCOTUS. It worked for Obama and with the election in 90 days it will show he is taking action to help those in need.