Monday, August 8, 2022

Republican moderates receive White House invitation to discuss US revival

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Joe Biden is due to meet with a group of moderate Republican senators on Monday afternoon as negotiations shift into high gear on his $ 1.9 billion stimulus package – his top priority since becoming President of the United States .

Mr Biden invited lawmakers, led by Maine Senator Susan Collins, to the White House after proposing a cutback economic relief plan worth approximately $ 600 billion on Sunday.

Their offer falls well short of what the Biden administration and many Democrats believe is necessary to back the American economic recovery this year because it continues to suffer from the fallout from the pandemic.

But Mr Biden, who has vowed to seek bipartisan support for his platform, sees the proposal as the first concrete sign that some Republicans are ready to embark on his economic policies.

Mr Biden’s talks with the Republican senator group risk a backlash from members of his own Democratic Party, who push the president to move forward without seeking opposition support that would inevitably soften the revival.

Under current Senate legislative practice, Mr. Biden would need at least 10 Republican lawmakers to back his plan in order to clinch the supermajority necessary to get it through to the final vote. However, Democrats said they were prepared to use a special procedure called budget reconciliation, reserved for certain tax and spending measures, to pass the stimulus bill, allowing them to bypass Republican support.

Mr Biden’s $ 1.9 billion stimulus package would include $ 1,400 in direct payments to individuals, aid to state and local governments, an extension of child tax credits and an extension of federal benefits unemployment. The proposal led by Ms. Collins would reduce direct payments to $ 1,000 per person and make them accessible to fewer families. It would also cut significant aid to states and local governments and reduce the length of unemployment benefits, which would be big disappointments for Democrats.

However, like Mr Biden’s plan, it includes $ 160 billion for new spending on the coronavirus response to improve the United States’ testing capacity and speed up vaccinations across the country.

The Biden administration might not be willing to seriously consider Ms Collins’ offer unless it is significantly beefed up in the coming days. Its top economic officials, including Janet Yellen, the Treasury Secretary, have argued that the risks of doing too little to shake up the U.S. economy are far greater than the risks of doing too much, especially with high rates. interest so low that higher deficits are not of great concern.

“The benefits of acting now – and of acting big – will far outweigh the costs in the long run,” Ms. Yellen wrote in a tweet Sunday.

But Republicans may not be ready to go higher, given their party’s resistance to higher spending and reluctance to give Mr Biden a quick legislative victory. Pat Toomey, Republican senator from Pennsylvania, said he didn’t see the point of a new stimulus package since Congress agreed to spend $ 900 billion in December.

The US economy was no longer in “free fall” but in “strong growth mode,” Toomey told CNBC on Monday. “It sounds a lot more like to me what we just did, literally 36 days ago. Why we need a few weeks later to come back and start over, I don’t understand.


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