Thursday, February 22, 2024

Stimulus Update: Executives Seem On The Edge Of A Deal On Sunday With $ 600 Checks

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Key Washington negotiators, propelled by a late-night deal on the last major hurdle to a COVID-19 economic relief program, said a deal on Sunday was almost inevitable to deliver pandemic aid worth nearly $ 1 trillion. dollars, long overdue.

“I have high hopes that we will get there today,” minority parliamentary leader Kevin McCarthy, R-Calif., Told Fox News Channel’s “Sunday Morning Futures”.

The breakthrough involved an emergency Federal Reserve powers struggle that was resolved by the Senate’s top Democrat and a high-ranking Conservative Republican. Helpers to lawmakers on both sides said the compromise sparked a final round of negotiations on a handful of outstanding issues.

An aide to a key GOP lawmaker said it would likely take any Sunday to finalize and draft the final deal, which is already guaranteed as the biggest spending measure yet, combining COVID-19 relief with a $ 1.4 trillion omnibus spending bill and reams of other unrelated laws on taxes, health, infrastructure and education.

The measure is finally set to be passed amid a frightening spike in coronavirus cases and deaths and mounting evidence the economy is struggling. Lawmakers and aides say it would establish additional temporary unemployment benefits of $ 300 per week and $ 600 in direct stimulus payments to most Americans. It would provide a new round of grants to hard-hit businesses and money to schools, health care providers and tenants facing eviction.

President Donald Trump is supportive, in particular, of the desire to provide more direct payments. “DO IT DONE,” he said in a late-night tweet.

It would be the first major legislative response to the pandemic since the $ 1.8 trillion CARES law was passed almost unanimously in March.

COVID-19 legislation has been delayed by months of dysfunction, posture and bad faith. But the talks turned serious last week, as lawmakers on both sides finally faced the deadline to act before they left Washington for Christmas.

The measure is added to a $ 1.4 trillion spending bill and combined with many other unfinished business, including previously blocked legislation to extend tax breaks, clear water projects and fix the problem of waterways. excessive medical bills in case of off-grid. procedures.

It would be next to impossible for lawmakers to read and fully understand the sprawling legislation before a House vote scheduled for Monday. Senate action would follow.

Meanwhile, as the government shutdown deadline looms at midnight Sunday, lawmakers have faced the reality of the need to enact yet another temporary spending bill – the second in as many days – to avoid shutting down non-core activities of federal agencies on Monday.

Lawmakers had hoped to avoid this step, but progress slowed on Saturday as GOP Senator Pat Toomey of Pennsylvania pushed for the inclusion of a provision to shut down Fed lending facilities. Democrats and the White House said the wording was too broad and would have tied the hands of the new Biden administration, but Republicans rallied to Toomey’s position.

The Fed’s emergency programs provided loans to small and medium-sized businesses and bought government and local government bonds. These bond purchases made it easier for these governments to borrow, at a time when their finances were under pressure from job losses and health costs associated with the pandemic.

Treasury Secretary Steven Mnuchin said last month that these programs, along with two that bought corporate bonds, would close at the end of the year, prompting an initial objection from the Fed. Under the Dodd-Frank Financial Review Act passed after the Great Recession, the Fed can only implement emergency programs with the support of the Secretary of the Treasury.

Toomey defended his disposition in a Senate speech, saying emergency powers were designed to stabilize financial markets at the height of the pandemic this spring and expire at the end of the month anyway. Democrats said Toomey was trying to limit the Fed’s ability to stimulate the economy, just as President-elect Joe Biden was preparing to take office.

“These are the existing authorities that the Fed has had for a very long time, to be able to use in an emergency,” said Senator Elizabeth Warren, D-Mass. “This is a lending authority to help small businesses, state government, local government in crisis.”

Toomey disputed this, saying his proposal “is by no means a general overhaul of the Federal Reserve’s emergency lending authority.” His office issued a statement Sunday morning calling the compromise with Schumer a “wholehearted victory for taxpayers” that met Toomey’s goal of shutting down the emergency facility.

The emerging virus aid deal would bring more than $ 300 billion in aid to businesses, plus an additional $ 300 per week for the unemployed and the renewal of state benefits that would otherwise expire just after Christmas . It included $ 600 in direct payments to individuals; vaccine distribution fund; and money for tenants, schools, the postal service and people in need of food assistance.

The government-wide appropriation bill would fund agencies until next September. The move was likely to provide a final installment of $ 1.4 billion for Trump’s border wall between the United States and Mexico as a condition for earning his signature.

More to read absolutely financial cover of Fortune:


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