With a $2.5 trillion gulf between Republican and Democratic stimulus packages – and ongoing negotiations between the White House and Senate GOP over issues such as a payroll tax cut favored by President Trump, chances of a successful negotiation happening anytime soon are fleeting at best – and will most likely continue beyond when the $600 weekly unemployment carved out under the Cares Act is set to lapse at the end of the month.
Notably, the Republicans are aiming for a $1 trillion stimulus package, while Democrats have a $3.5 trillion price tag on theirs.
In order to address what will undoubtedly be a protracted negotiation, lawmakers are considering a side-deal which would extend the unemployment bonus, according to Bloomberg.
While Republicans have criticized the $2,400 per month stipend as a disincentive to seek work, the plan to extend the benefits has drawn the support of GOP Senators, including Marco Rubio (R-FL), who acknowledged that lawmakers are considering the plan. That said, the size and scope of any extension is currently unknown.
Both parties also support extending supplemental unemployment benefits. Some Republicans have floated the idea of structuring it so that unemployment insurance replaces 70% to 75% of previous wages rather than the flat $600 per week boost to state benefits in the last stimulus. But others, including Finance Committee Chairman
Chuck Grassleyof Iowa, have insisted that the solution has to be simple enough for the states to easily implement. –Bloomberg Tax
Not in favor of the extension is House Majority Leader Steny Hoyer (D-MD), who said “I would prefer not to see a short-term extension,” adding that he wants “to give people the security they are not going to be let down and fall through the cracks in September and October.”
Meanwhile, the White House has softened its tone regarding a mandatory payroll tax holiday, though on Tuesday Press Secretary Kayleigh McEnany said that President Trump is still in favor of the measures.
Chief of Staff Mark Meadows echoed this sentiment, saying in a Tuesday statement on Capitol Hill: “I don’t know that in any negotiation that there are red lines, but there are certainly high priorities and it will remain a very high priority for the president.“
Meadows and Treasury Secretary Steven Mnuchin are returning to the Capitol Wednesday after an initial round of talks with Senate Republicans ended without a clear outline or any lessening of GOP resistance to President Donald Trump’s desire for a payroll tax holiday. –Bloomberg
Also on Tuesday, Senate Majority Leader Mitch McConnell (R-KY) outlined some of his own priorities – namely extending the PPP loan program for small businesses, as well as another round of direct payments to individuals.