Trump Administration Lowballs Unemployment Benefits In New COVID-19 Offer

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The latest stimulus offer from the White House comes with one-time $600 payments for most Americans and a lump of coal for the unemployed. 

The new proposal offered by Treasury Secretary Steve Mnuchin swapped the $300 unemployment supplement that has bipartisan support on Capitol Hill with a single round of direct payments worth up to $600, according to a person familiar with the negotiations.

Mnuchin said earlier Tuesday that he had spoken to congressional leaders about the administration’s support for a $916 billion package, noting that it was “a slightly larger package” than the $908 billion deal under discussion by a bipartisan working group. 

But whatever “progress” lawmakers were making — House Speaker Nancy Pelosi (D-Calif.) used that word after learning that Senate Majority Leader Mitch McConnell apparently supported the offer — Pelosi said it was “unacceptable” to only provide $40 billion worth of federal unemployment insurance instead of the $180 billion that had been under discussion by the bipartisan group. 

Pelosi added that the president’s proposal shouldn’t “obstruct” the negotiations led by moderate senators, including Mitt Romney (R-Utah) and Joe Manchin (D-W.Va.). 

“The bipartisan talks are the best hope for a bipartisan solution,” she said. 

The new offer from the Trump administration capped a day of confusion on Capitol Hill, where lawmakers are struggling to reach a deal on another coronavirus relief package before the end of the year. The bipartisan group of eight senators is hung up on figuring out how to protect businesses from coronavirus-related lawsuits, a top priority of McConnell, as well as provide aid for state and local governments. The senators are hoping to finalize their package sometime this week.

Meanwhile, McConnell suggested on Tuesday dropping both state and local aid as well as liability protections from the coronavirus relief bill in order to bolster chances of its passage this year. The “new administration,” he said, would get another chance to resolve the issue.

Democrats quickly shot down the idea, however, accusing McConnell of trying to “sabotage” the talks.  

“Mitch doesn’t want a deal,” Manchin told reporters, noting there is bipartisan support for aid to state and local governments. The framework also has funds for distributing a coronavirus vaccine, meaning that, without a deal, the pandemic could drag on longer.

The $600 payments in the White House proposal reflect recent calls for another round of rebates like the $1,200 payments included in the Coronavirus Aid, Relief and Economic Security (CARES) Act. Lawmakers involved in the recent bipartisan negotiations, however, have said such payments, which go to the vast majority of U.S. households, are “stimulus” when “relief” is much more urgent for struggling workers and businesses. 

The tentative Manchin-Romney compromise on unemployment would add $300 per week to state and federal benefits for four months, and also preserve federal programs for gig workers and the long-term jobless for the same amount of time. The lawmakers involved have provided no other details.

Both the White House proposal and McConnell’s most recent offer include $0 for supplementing weekly unemployment payments, even though both previously supported bringing back the extra benefits at a reduced level.

In March, when the coronavirus pandemic had barely started, lawmakers rushed to pass trillions in new spending with unprecedented support for the unemployed, providing benefits to gig workers and adding an unheard-of $600 to all weekly unemployment payments. 

Economists credited the extra money with propping up the economy, but lawmakers thought the pandemic would end in a few months. The $600 expired in July and the other programs will lapse at the end of the month, cutting off income for nearly 12 million workers as job growth sputters. 

House Democrats seem ready to support almost any deal. When HuffPost asked Transportation Chairman Pete DeFazio (D-Ore.) Tuesday night about the negotiations in the Senate, he snapped back: “We should take whatever we can get.”

That was a sentiment expressed by a number of Democrats, though many lawmakers did mention the liability shield as a potential redline. 

But a deal without extra unemployment benefits may also be a bridge too far for Democrats. One of the main points of compromising for Democrats is to get unemployed people extra money after their extra benefits expired.

Rep. Derek Kilmer (D-Wash.) noted to HuffPost that he had spent hours on the phone talking with unemployed people who are hurting, which is why he was so ready to make a deal — even if it were ultimately insufficient. 

Even Alexandria Ocasio-Cortez (D-N.Y.) seemed ready to make a deal, though she made it clear she wanted the stimulus to include cash payments.

Ocasio-Cortez was so ready to compromise that she was even talking about agreeing to a short-term liability shield in some fashion. 

“It’s a bitter pill; I think it’s one that we could swallow if it’s really limited in scope,” she said.

But Democrats still feel like it’s on Republicans to meet them at this point, and some aren’t sure that GOP leaders are all that interested.

Rules Chairman Jim McGovern (D-Mass.) said it was tough to make a deal with an “irrational person” like McConnell. 

“I mean, people’s lives are at stake and he’s playing these ridiculous games,” McGovern said. “It’s really disgusting.”

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