The White House is considering sending a $2,000 check to tens of millions of Americans and giving $300 billion to small businesses alone as a bailout bill costing more than a trillion dollars takes shape.
The stimulus bill assumes several months of shuttered businesses, little domestic travel, and massive layoffs during the COVID-19 crisis.
And it may get even worse. The president has been considering a nationwide “shelter-in-place” order, where economic activity would virtually cease.
Treasuring Secretary Steven Mnuchin warned Republican senators that the slowdown could result in 20 percent unemployment and permanently damage the economy without quick and massive action.
Mnuchin met with senators to persuade them to pass a $1 trillion stimulus package that would send cash to Americans within two weeks, and backstop airlines and other companies. The Senate is majority-controlled by President Donald Trump’s fellow Republicans.
A Treasury official said Mnuchin was not providing a forecast but trying to illustrate the potential risks of inaction.
In fact, Mnuchin may be lowballing the potential unemployment rate and won’t say what many economists believe because the number is too fantastical.
Moody’s Analytics forecasts that 27 million positions are at high risk due to the virus, most being in hospitality, transportation, leisure and travel. Temporary workers will also be highly affected, as will people in the field of oil drilling and extraction, Zandi said.
“Maybe 20 percent of those workers, comprising about 5 million jobs, will be affected,” he said.
The rest of the positions, about 52 million, are at moderate risk — education, retail, construction and manufacturing. Zandi estimates about 5 million of those people could end up jobless or underemployed.
In contrast, about 800,000 people lost their jobs in the Great Recession.
So, we’re going to be stimulated. The outlines of the plan will probably be finalized by the end of this week and Congress will fill in some of the blanks next week. Unless members start trying to stuff the plan with all sorts of nonsense — anti- or pro-abortion riders, tax breaks for favored donors, etc. — Trump should have something on his desk by next Friday.
Some of the specifics:
Checks would be sent to Americans below a certain income level, although it is not yet clear what that level will be. The Trump administration’s stimulus currently calls for $500 billion in cash payments, with another $500 billion for various businesses including $50 million for the airline industry, which has been particularly hurt by the pandemic.
Senate Democrats proposed a $750 million stimulus package on Monday, while on Tuesday the Trump administration floated an $850 million stimulus. Talks between administration officials and Congress are ongoing, with the current proposal amounting to an injection of $1 trillion into the U.S. economy.
Republican senators have called for immediate assistance to Americans affected by the pandemic, although the specifics of the assistance are still being debated.
It’s amazing what a crisis will do for bi-partisanship.
But does it really take a crisis of this magnitude to get Congress to work together? Think of all the national problems we’re dealing with: trade, immigration, the deficit, an aging population, and a dozen other issues that would benefit enormously if Congress would look for common ground rather than scoring political points at every turn.
American democracy can work. But only if we demand that it works. That doesn’t mean you give up partisanship or surrender to the other side. It means respecting the views of the other side and looking for ways to cooperate rather than trying to destroy each other.
Yes, it’s quaint and old-fashioned to believe that self-government can work. But even rabid partisans may be asking why Congress can’t work as well without a once-in-a-century crisis to contend with.