The U.S. Senate late Wednesday passed an unprecedented economic relief package aimed at propping up an American economy increasingly paralyzed by efforts to contain the coronavirus.
The bill still must clear the Democratic-majority House of Representatives before being signed into law by President Donald Trump. House leaders said they expect the bill to pass by a voice vote on Friday.
Stock markets plunged again at the beginning of this week – following last week’s losses that wiped out nearly all gains recorded during Trump’s presidency – as activity in public places across the country ground to a halt.
With factories, businesses, restaurants and schools shutting down and entire industries in shambles, workers are facing layoffs, cutbacks in hours or having to make the difficult choice of working while ill if they lack paid sick leave.
The $2 trillion economic relief package will directly affect the American people, Senate Minority Leader Chuck Schumer said Wednesday, and “could make the difference in the next few months between putting food on the table and going hungry, between surviving this period of unemployment and financial ruin.”
Lawmakers and the White House have moved through a series of phases intended to rescue the U.S. economy. Here is a summary of what each phase has been designed to do.
Lawmakers initially focused on funding U.S. public health efforts to combat the coronavirus, passing an $8.3 billion package earlier this month.
Trump asked Congress for a little more than $2 billion in funding, with a plan to fund $535 million of that request by rerouting unused funds allocated to fight Ebola. Democrats pushed back on that plan and ultimately negotiated a bill with the White House that included $3 billion for coronavirus vaccine development and $1 billion for U.S. international aid efforts to combat the virus.
The House of Representatives took the lead on negotiating the first bill with Treasury Secretary Steve Mnuchin to address the devastating economic impact of the crisis.
The Senate passed phase two of the bill last week by a 90-8 vote. The bill offers COVID-19 testing without cost, an extension of unemployment benefits to address the needs of workers who may be laid off due to the crisis, as well as paid sick leave for workers at some U.S. companies.
Lower-income workers in the United States make up one-quarter of the American workforce that has no access to paid sick leave.
The House-passed bill has several loopholes, which means the sick-leave extension would not apply to companies with fewer than 50 employees or more than 500 workers. The bill also caps the amount of sick leave pay workers can collect.
The Senate took the lead on working with the White House to craft a massive $2 trillion economic relief plan.
“The strange new reality has forced our nation into something like wartime,” Senate Majority Leader Mitch McConnell said Wednesday of the need to address the economic impact of the coronavirus.
McConnell said the legislation addresses four urgent priorities, including delivering aid directly to the American people, stabilizing key hard-hit industries such as the airlines, stabilizing small businesses hurt by closures and increasing aid to the healthcare industry.
Schumer, who described the legislation as “the largest rescue package in American history” had unexpected leverage in the negotiations. Senator Rand Paul of Kentucky on Sunday became the first U.S. senator to test positive for the coronavirus. His absence – along with self-quarantining measures by Utah Senators Mike Lee and Mitt Romney – meant McConnell had to have Democratic votes to pass the measure.
Democrats pushed for added controls over a $500 billion fund aiding corporations, including the airline and cargo industries, that have been particularly hard hit by travel stoppages.
“If any of these loans look untoward, if any of these loans don't look right, if any of these loans shouldn't go to where they're going, the public, the Congress will know quickly,” Schumer said Wednesday.
The legislation would also increase the amount of unemployment insurance to out-of- work Americans to four months while providing direct cash assistance of up to $1,200 to most lower- and middle-class individuals and $2,400 to married couples, with $500 for each child.
Small businesses, state and local governments and hospitals and other health care providers will all receive billions of dollars in funding to address the impact of the coronavirus.
The legislation will account for 8 percent of the entire gross domestic product of the United States, according to Gabriel Mathy, an economics professor at the American University.
“The $2 trillion figure is actually greater than an entire year of the federal budget,” said Matt Dallek, a political history professor at the George Washington University Graduate School of Political Management. “So, it's obviously historic, and it looks like the bill is more than double the massive stimulus President Obama signed in 2009.”
Dallek said that “just because the price tag is unprecedented doesn't mean it is sufficient to meet the nation's economic emergency.” House Democrats are already discussing fourth and fifth phases of legislation to address the crisis.