At least seven senators aligned with the Democratic Party now support this idea. Those senators have signed a new letter to the Senate leaders in both parties calling on them to support sending up to $4,500 to every adult and child in the United States, in installments.
“We propose sending cash payments directly to American families,” reads the latest draft of the letter, which is signed by Democratic Sens. Michael Bennet, Sherrod Brown, Cory Booker, Chris Murphy, Brian Schatz, Richard Blumenthal and Angus King (who is an independent but caucuses with Democrats). Additional signatories are likely.
Here’s how the proposal works. In its first wave, it would provide $2,000 per person, to cover the period between now and June, including adults and children, people working and those unemployed, and those who are retired or on disability. It would phase out for those with higher incomes.
Then, come June, another $1,500 payment would be made, if either the secretaries for treasury or health and human services certify that the public health emergency is still ongoing, or the unemployment rate has gone up by at least 1 percentage point over the average in unemployment between last December and this February.
That last part all but guarantees the second payment would be made, because pretty much everyone predicts that unemployment will be much higher by then. The proposal also includes a provision for possible further quarterly payments starting in October.
The reason it’s important to work in such a guarantee is that, should a Democrat win the White House, and should the economic crisis still be upon us, one can envision Republicans in Congress suddenly deciding they no longer support sending checks to people, since that might spur along the recovery.
And so, under this proposal, the Democratic administration could then certify that the emergency is continuing — meaning the payments would continue. Or perhaps the unemployment rate would still be high enough to trigger the payments.
As anyone with a passing familiarity with recent political history knows, Republicans do not support stimulus spending when a Democrat is in the White House. In 2009, President Barack Obama’s stimulus bill got zero Republican votes in the House and only three in the Senate.
Now, of course, President Trump does support such spending (it will help with the economy while he’s up for reelection) and a handful of GOP senators — such as Mitt Romney and Tom Cotton — appear ready to go along.
And so it is that on Tuesday, Treasury Secretary Steve Mnuchin told congressional Republicans that the White House was putting together a package that would send out $250 billion in checks by the end of April, though they would be means-tested to some degree, meaning wealthier families wouldn’t get them.
That wave of checks could be followed by another one four weeks later if Trump determined that the economic emergency was still ongoing.
It remains unclear whether Democratic and Republican leaders in the Senate and House will go along with direct cash payments.
According to a Democratic leadership source, Senate Minority Leader Charles E. Schumer (D-N.Y.) wants to focus first on solving the looming health-care crisis, in particular the possibility of a serious swamping of hospitals.
Still, the source tells us Schumer is not taking the direct-payments idea off the table. Earlier, Schumer offered his own stimulus package, much of it in the form of expanded funding for unemployment insurance, Medicaid, subsidized treatment for the coronavirus, and assistance for small businesses and child care.
Separately, House Speaker Nancy Pelosi (D-Calif.) supports a more targeted approach to those hit hardest by any economic downturn, as opposed to money sent to every American, and Pelosi wants this done via refundable tax credits, expanded unemployment and possibly direct cash payments as well.
There has been a lot of talk about how Republicans are “outflanking” Democrats by proposing the direct cash transfers. But this is premature: We still haven’t seen an actual proposal from the White House, and it’s unclear who is going to end up where on this issue after the music stops.
It’s also important to note that direct cash payments aren’t the only step we’d take — there are many other possible moves being discussed, including beefing up food stamps and unemployment insurance, providing zero-interest loans to businesses and extending sick leave.
Democrats embrace many of those ideas, and in evaluating the progressiveness of the competing proposals that do emerge, all the ideas in them should be taken into account. Thus far, Republicans appear more focused on bailouts for industries such as airlines, cruise ships and even casinos.
Right now it’s Democrats who are advocating the most aggressive steps to save the economy — even though the political benefit will flow to the president if they succeed.
And at any rate, Democratic leaders could end up in a better place than the White House does on direct cash payments.
Let’s hope both agree to this. As Adam Ruben of Economic Security Project Action, put it in a statement, the most important thing is providing “immediate relief to individuals and households, while boosting the economy."
It’s startling how quickly a consensus has developed here. The question suddenly seems to be: How far will the government go to put money in everyone’s pocket?
Given how quickly the economy is headed for a cliff, they’d better decide soon.