Senate Republicans on Thursday announced a $1 trillion stimulus plan to combat the economic damage caused by the effort to control the coronavirus.
The measure includes a plan to send $1,200 checks to individuals and $2,400 to couples earning below a certain income to help them survive the economic impact and layoffs caused by the coronavirus.
It also would provide a cash infusion for small businesses, the airline industry, and healthcare providers scrambling to test and treat patients afflicted with the virus.
“This legislation takes bold action on four major priorities that are extremely urgent and very necessary,” Senate Majority Leader Mitch McConnell, a Kentucky Republican, said before introducing the measure Thursday.
The cash payments are aimed at middle- and low-income earners.
Individuals who earn less than $75,000 would be eligible for a $1,200 check, while couples under the $150,000 threshold would receive $2,400. Families would also receive an additional $500 for each child. Those earning more would receive a reduced stipend.
The amount is higher than the $1,000 initially proposed by Treasury Secretary Steven Mnuchin and may be an effort to win the necessary support from Senate Minority Leader Chuck Schumer, a New York Democrat, who said $1,000 wasn’t enough.
The checks would be limited to 2018 tax year income liability, though, meaning that many families would not receive the full amounts. Individuals with only nominal earnings would receive a minimum $600 check.
To prop up small-business employment, the proposal includes $300 billion worth of Small Business Administration loans that would convert to grants to the extent that businesses could show the money was used to maintain payroll.
The Republican bill also includes assistance for industries directly threatened by the pandemic, including $50 billion in loans for passenger airlines, $8 billion for cargo airlines, and $150 billion for “other eligible businesses,” which likely includes the cruise ship and hotel industries.
Sen. Roger Wicker, a Mississippi Republican, said the plan would prohibit the funds from being used to provide bonuses or “golden parachutes” for executives. “These are loans we expect to be repaid when times are flush again.”
To aid business generally, the bill would delay all tax payments for corporations until Oct. 15, with no caps on the amount of taxes postponed. Also included is a delay on employer payroll taxes — the 6.2% Social Security tax.
Schumer went to the Senate floor after McConnell to discuss his own five-point stimulus plan focused on bolstering aid to hospitals and providing income for out-of-work individuals.
Schumer said he preferred using the unemployment insurance system, expanding it to provide more money rather than direct cash payments, and also called for family paid leave and sick leave.
“Too many people are not covered in a strong and longer-term way,” Schumer said. “We must have it in this proposal.”
Schumer said he wants to include a “worker-first” provision in any language that bails out the airline industry, which in recent months has spent billions in stock buybacks.
Congress is under enormous pressure to provide immediate assistance to workers and industries that are facing the prospect of mass layoffs and bankruptcies.
Jobless claims soared last week, the Department of Labor reported Thursday in a glimpse of the major job losses underway. The airline, hotel, and cruise industries have been brought to a near-halt. Restaurants and bars, too, have seen a virtual shutdown in many cities. Automakers have paused production and sent workers home.
Federal policymakers are trying to prevent the temporary stop in commerce from translating into permanent dislocations for companies that face ongoing overhead expenses and workers who have to pay mortgages and student debt. The Senate GOP legislation would allow student borrowers to defer payments and for Pell Grant recipients to keep funding even while they are kept from school.
Meanwhile, government officials are racing to prevent the spread of the virus and to develop therapeutic drugs and vaccines. President Trump said Thursday that the success of any stimulus measure would depend on whether the underlying public health issue is addressed effectively. “So much depends on what’s going on in this room, in terms of the medical,” he said at a White House briefing. “If we can stop it in its tracks, the virus, it’s plenty.”
