Senate Rushes to Approve $2.2 Trillion Coronavirus Bill After Landmark Agreement with White House

New York Governor Andrew Cuomo, a Democrat, has demanded changes to help his state deal with a flood of new virus cases. Four Republican senators on Wednesday claimed a provision in the bill needed to be fixed immediately or it would incentivize people not to return to work. And House Democrats wouldn’t provide a firm timeline of when they would vote to pass the bill.

The final-stage drama was just the latest twist for the massive spending bill, which had snowballed from President Trump’s push for an eight-month payroll tax cut into the largest emergency relief bill in American history. Senate Majority Leader Mitch McConnell (R-Ky.) and Minority Leader Charles E. Schumer (D-N.Y.) announced the agreement on the Senate floor around 1:30 a.m., after a long day of talks with Treasury Secretary Steven Mnuchin and other administration officials.

“I will sign it immediately,” Trump said Wednesday evening as Senate lawmakers tried to set a time for a vote.

The bill would extend $1,200 to most American adults and $500 to most children, create a $500 billion lending program for businesses, cities, and states, and another $367 billion employee retention fund for small businesses. It would direct $130 billion to hospitals and provide four months of unemployment insurance, among other things.

Lawmakers and the White House were bombarded with lobbyists and special interest groups seeking assistance in final days of negotiations, and it snowballed from $850 billion to $2.2 trillion in just a matter of days.

And, with confirmed coronavirus cases in the U.S. climbing swiftly to over 60,000 Wednesday with more than 800 deaths, lawmakers themselves acknowledged that no amount of economic relief from Congress could stop the pain for the American public. A surge of Americans have filed for unemployment benefits, including 1 million in California this month alone. In addition to layoffs, many workers are dealing with salary reductions or furloughs. And despite Trump’s push to restart much of the economy by April 12, there are growing signs that the economic drag could last well into the second half of the year.

House Democrats said they would vote on the legislation no sooner than 24 hours after it was introduced in the Senate, and the Senate delays kept pushing the bill’s timeline back.

House Speaker Nancy Pelosi (D-Calif.) gave an upbeat assessment of the bill early Wednesday, but the logistics of the legislation’s passage through the House remained uncertain. They are expected to try and approve the measure by “voice vote,” aware that they will not be able to receive “unanimous consent” to pass the bill.

Cuomo on Wednesday demanded changes, though it’s unclear how amenable lawmakers might be to any final adjustments.

Around half of the country’s cases are in New York, and the health care system around New York City is completely overwhelmed. Many hospitals are still rushing to find health masks and other protective equipment. Cuomo said the bill would be “terrible” for his state and added that “We need the House to make adjustments.”

Meanwhile, Sens. Tim Scott (R-S.C.), Rick Scott (R-Fla.), Ben Sasse (R-Neb.) and Lindsey Graham (R-S.C.) raised major concerns of their own on Wednesday. They claimed a “drafting error” in the bill would create incentives for companies to lay off workers instead of retain them on the payroll, complaining the design of unemployment benefits would allow some workers to make more money on unemployment than at work. But it’s unclear whether Senate leaders would make the change, as the provision as written was a key demand from Democrats.

Later Wednesday, Trump told reporters that he had spoken with some of the senators to address their concern, and White House officials did not expect the issue to derail the bill from passage.

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The legislation ensures that taxpayer-backed loans cannot go to firms controlled by Trump, other White House officials or members of Congress. This would suggest that Trump-owned properties, including hotels that have been impacted, cannot seek taxpayer assistance.

The airline industry, which has suffered huge losses in the past two months because of cancelled flights and travel restrictions, would be a top recipient in the bill. Passenger airlines would qualify for $25 billion in loans or certain guarantees and also have access to a $25 billion fund that the Treasury secretary could have extend through mechanisms like equity investments, according to Sen. Patrick J. Toomey (R-Pa.), who worked late into the night Tuesday finalizing the language with Senate leaders.

Toomey said he would have preferred long-term low-interest loans to airlines, “But we had this argument, we had this discussion, and it turned out the way it did,” Toomey said, making clear he intended to support the legislation as written.

Cargo airlines and suppliers would qualify for a different batch of money.

And another provision of the bill would authorize $17 billion in assistance for companies deemed crucial for the U.S.’s national security, language that was written in part to ensure assistance for Boeing, three people with knowledge of the internal deliberations said.

And there’s an employee retention tax credit for many firms impacted by the coronavirus, and provisions to allow businesses to defer payment of payroll taxes for two years.

The legislation’s significant boost to unemployment benefits, which Schumer has repeatedly described as “unemployment insurance on steroids,” would expand eligibility in addition to increasing payments. The surge of new applicants for jobless claims has flooded a system that isn’t designed for a flood of new applicants. But even with all the new funding, it’s unclear how smoothly any of the changes might work. For example, the bill would dramatically expand the Small Business Administration’s ability to guarantee loans, but millions of companies could seek these guarantees all at once, putting enormous pressure on a system that has never been tested in such a manner.

After falling 10,000 points in two months, the Dow Jones industrial average regained more than 2,500 points on Tuesday and Wednesday amid optimism about the recovery package. The precise impact of the legislation could take months to understand. Many businesses have been hammered, perhaps beyond repair, by the economic impact of the virus.

The prolonged impact could be different in various parts of the country, as Trump has signaled he wants some parts of the economy to reopen very quickly but some of the country’s biggest economic engines – such as New York, Chicago, and San Francisco – are seeing problems escalate.

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As the bill was coming together in the final days, Democrats fought to make numerous changes. For example, the White House and Republicans agreed to allow an oversight board and create a Treasury Department special inspector general for pandemic recovery to scrutinize the lending decisions and detect abusive or fraudulent behavior.

“Every loan document will be public and made available to Congress very quickly, so we can see where the money is going, what the terms are and if it’s fair to the American people,” Schumer said on the Senate floor Wednesday.

The bill also contains a grab-bag of provisions that in some cases might seem to range far afield from the coronavirus pandemic, including $13 million for Howard University, $25 million for Washington’s Kennedy Center for the Performing Arts, and $75 million for the National Endowment for the Arts and Humanities National Endowment for the Arts. Senate aides said those allocations and others were justified to help the institutions prepare for and respond to the coronavirus outbreak.

Trump said he personally approved the Kennedy Center funding, for example, and said institutions like that needed support because they faced severe disruptions like many other parts of American life. He acknowledged, though, that assisting an institution like the Kennedy Center might come across like “not a good soundbite but that’s the way life works.”

If the Senate passes the bill, the next step is a little less clear. The House is out of session, so action there could take longer, depending on whether lawmakers can agree to pass the bill by “unanimous consent,” which would require agreement from all members of the chamber.

One prominent liberal — Rep. Alexandria Ocasio-Cortez (D-N.Y.) — has already suggested she could oppose it.

Many members have voiced concerns about returning to the tight quarters of the Capitol, with at least two House members testing positive for coronavirus and others in quarantine. Another option, which McCarthy endorsed Wednesday, would be to pass the legislation by “voice vote” in the House. That could allow any members who wanted to return to Washington to debate the issue publicly to do so, before passing the legislation without a roll-call vote that would require a quorum to be present. McCarthy suggested time for debate should be allowed on the House floor.

“I know we’re in a very challenging time…but I don’t think we should pass a $2 trillion package by unanimous consent,” McCarthy said.

Trump says he hopes to ease coronavirus guidelines by Easter

President Trump said he hopes to reopen the economy by Easter during a news conference on March 24. (The Washington Post)

Still, all sides expressed eagerness to move swiftly.

“We need this to get working for the American people,” Mnuchin said. “And again, there are a lot of compromises. It’s a terrific bill. And it was a great accomplishment for everyone.”

Congress has already passed two much smaller coronavirus relief bills: an $8.3 billion emergency supplemental for the health-care system and a $100-billion-plus bill to boost paid sick leave and unemployment insurance and provide free coronavirus testing.

Jeff Stein contributed to this report.