Senate Democrats Block Republicans’ Slimmed-Down $500-Billion Stimulus Bill

(Sept. 10) Senate Democrats blocked a narrowly tailored pandemic relief plan proposed by Republicans, contending the measure was too meager a response given the damage that Covid-19 continues to wreak on the U.S. economy.

The Senate’s vote in favor of the bill was short of the 60 needed to advance the legislation for floor debate, leaving Congress at an impasse just weeks before lawmakers return home to campaign in the pivotal fall elections.

Estimated at roughly $500 billion to $700 billion, the package was less than the Republicans’ own $1 trillion plan from July, intended to target the most pressing areas for help -- revived supplemental unemployment insurance benefits and extended aid for small business, in particular. The bill was a fraction of the $2.2 trillion backed by Democrats.

Senate Minority Leader Chuck Schumer dismissed the Republican bill as little more than an election-year prop for vulnerable GOP incumbent senators. Yet he said he thought Republicans would return to the bargaining table to craft a bipartisan bill after failing to pass their own -- as occurred with the previous aid packages.

“If past is prologue, there’s actually a significant chance that the public heat on many Republican senators as they go back home will have them come to their senses, and they’ll start negotiating with us in a serious way,” Schumer said before the Senate vote.

Senate Majority Leader Mitch McConnell argued that much in his bill addressed areas that both parties agreed to, including the jobless benefits and Paycheck Protection Program for small businesses. The question was whether Democrats prefer to “hide behind closed doors and refuse to help families before the election,” he said before the vote.

McConnell this week declined to answer questions Thursday morning about what would happen after the expected failure of his bill. He did tell reporters he doubted Democrats want a deal before elections that will decide control of the White House and Senate.

Weekly figures on unemployment claims showed the labor market remains deeply damaged by the Covid-19 crisis. Initial jobless claims in regular state programs were unchanged at 884,000 in the week ended Sept. 5, the Labor Department said Thursday. That was well above the 850,000 economists had expected.

Graham Outreach

House Speaker Nancy Pelosi said Thursday that the Senate vote doesn’t mean the end of stimulus talks. “No,” she told reporters when asked the question.

Republican Senator Lindsey Graham, who is campaigning for re-election in South Carolina, said he’s not giving up on a relief package before the election. He said he’s reached out to Democratic Senator Chris Coons of Delaware, who often works with Republicans on proposals, to see if they can gather a group of senators to propose a middle ground.

The pared-back proposal, released Tuesday, provides a $300-per-week unemployment benefit enhancement, $105 billion for schools, a $10 billion grant to the U.S. Postal Service, $258 billion for the Paycheck Protection Program for small businesses, $47 billion for vaccines and testing needs, and liability protections for employers.

Absent from the bill: additional help for airlines, which face a wave of job cuts when support runs out from the $2.2 trillion Cares Act, the last big stimulus package. Underscoring the economy’s continued strains, Amtrak Chief Executive Officer Bill Flynn warned Wednesday about the impact of expiring Cares aid. The passenger rail network needs $2.84 billion in additional funding by Oct. 1 to avoid dismissals and service cuts, Flynn said.

The Congressional Budget Office hasn’t yet scored the cost of the Republican bill, which calls for drawing on unspent funds allocated to support Federal Reserve facilities.

Besides its smaller size, Democrats slammed the Republican bill for “poison pill” provisions that include lawsuit protections for businesses that reopen and a tax break for paying for private-school costs.

The White House and congressional Democrats have been more than $1 trillion apart on the stimulus since negotiations broke off Aug. 7. Democrats lowered their demand from $3.4 trillion that passed the House in May to $2.2 trillion, but haven’t budged beyond that.

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