For Senate Majority Leader Mitch McConnell (R-Ky.), wrangling a majority of the Senate behind the legislation constituted a measure of success, after months when Senate Republicans have been hopelessly divided. But next steps — if any — toward the kind of bipartisan deal that would be needed to actually pass a bill to provide new assistance were unclear.
Negotiations between congressional Democrats and administration officials have not restarted since collapsing in August.
“It’s sort of a dead-end street,” said Sen. Pat Roberts (R-Kan.). “Very unfortunate, but it is what it is.”
The failed Senate vote comes amid pleas from Federal Reserve officials and others who have said more fiscal assistance is needed to prevent the economy from sliding further this year. Many of the benefits approved by Congress in the $2 trillion Cares Act in March have run out. Roughly 29 million Americans received some type of jobless aid last week, new Labor Department data show, and large parts of the economy remain under severe strain.
On a conference call with House Democrats following the failed vote, Speaker Nancy Pelosi (D-Calif.) defended Democrats’ negotiating position in response to a question from Rep. Derek Kilmer (D-Wash.), head of the centrist New Democrat Coalition. Kilmer had expressed frustration about the failure to get a deal and underscored the need to renew expired unemployment benefits.
“We don’t want to go home without a bill, but don’t be a cheap date,” Pelosi told her members, according to a person familiar with her remarks who spoke on the condition of anonymity to relay them. “When you are in a negotiation, the last place to get weak knees is at the end.”
As the coronavirus pandemic began to grip the U.S. economy in February and March, Congress approved the Cares Act, which authorized a burst of funding to households and businesses in an effort to limit the recession’s toll. Some of the law’s main planks expired around the end of July, such as small-business assistance, $600 weekly enhanced unemployment aid and eviction protections.
House Democrats in May passed a $3.4 trillion bill that would extend some of those measures and approve a number of other initiatives, such as nearly $1 trillion for cities and states, but Republicans and the White House rejected that plan. The White House didn’t begin negotiations with Democrats over what to do next until late July, and those talks faltered as both sides dug in.
With the two sides at an impasse, President Trump last month signed four executive actions that were meant to provide some relief. These measures attempted to defer payroll taxes, provide eviction and student loan relief, and redirect some funds that could be used as unemployment aid. But the Federal Emergency Management Agency fund Trump tapped to provide the additional unemployment insurance benefits is being rapidly depleted. The additional unemployment assistance is now expected to completely disappear soon following Thursday’s vote.
The failed GOP bill would have authorized new money for small businesses, coronavirus testing and schools, and $300 in enhanced weekly enhanced unemployment benefits. The measure included roughly $650 billion in total spending, but it would repurpose roughly $350 billion in previously approved spending, bringing the tally of new funding to around $300 billion.
The measure did not include a second round of $1,200 stimulus checks for individual Americans, even though that’s something the White House supports. It also excluded any new money for cities and states, a top Democratic priority as municipal governments face the prospect of mass layoffs because of plunging tax revenue. And it contained some conservative priorities that Democrats dismissed as unacceptable “poison pills,” including liability protections for businesses and a tax credit aimed at helping students attend private schools.
Bipartisan negotiations never gained traction, in part because Senate Republicans struggled to unify behind a single plan in July. Many Republicans opposed any new spending at that time, and McConnell instead deferred to the White House to try to broker a deal with Pelosi. Those talks collapsed with no signs of progress, but McConnell kept working on a GOP bill as a way to balance the needs of a half-dozen vulnerable incumbents who were eager to vote on new aid as they campaign for reelection.
The political wrangling has played out amid mixed signals in the economy. The stock market has mostly recovered from the shock it took in late February and March, buttressed in part by enormous aid the Federal Reserve has injected into the economy. The labor market has recovered roughly half of the jobs that were erased in March and April, but millions of Americans remain unemployed and rehiring appears to have slowed.
The threat of eviction, hunger and poverty remains high.
Nationally, more than 1 in 4 survey respondents said they expect someone in their household will experience a loss of income in the next four months, according to the government’s Household Pulse Survey, which queried Americans about their financial well-being over the final weeks of August. The new figure, released Wednesday, suggests an estimated 64 million Americans are still facing significant hardship, though economists cautioned the numbers may be skewed because the Census Bureau had a lower rate of response than it has in its previous studies.
Slightly less than one-third of respondents said they struggled to pay for their usual household expenses last month, the survey estimates, and about 1 in 10 said they suffer from food insecurity, meaning someone in their household did not have enough to eat over the past week. Federal survey data also indicates that an estimated 5.4 million Americans may be facing eviction or foreclosure in the next two months, further adding to the pressure on lawmakers to address a looming housing crisis.
Democrats contended that the Senate GOP legislation, written without any Democratic input, was designed to fail and intended only to give Republicans cover for inaction. Republicans argued that Democrats were refusing to agree to any new relief because they didn’t want to help President Trump or bolster the fragile economic recovery ahead of the election.
“Working families have suffered and waited and wondered whether Washington Democrats really care more about hurting President Trump than helping them through this crisis,” McConnell said on the Senate floor ahead of the vote.
McConnell also expressed indignation about a comment made Wednesday by Senate Minority Leader Charles E. Schumer (D-N.Y.), who said that “Republicans are the enemy of the good” when asked whether Democrats had allowed the perfect to become the enemy of the good in coronavirus talks.
“The Americans we represent, however they vote, know that Republicans aren’t our enemies, and Democrats aren’t our enemies,” McConnell said. “The coronavirus is the enemy.”
In his own floor remarks, Schumer kept up his attacks on the GOP legislation and on McConnell, whom he has labeled the “Secretary of Cynicism.”
“Republicans dithered and delayed. They pushed their chips in with President Trump’s lot and hoped the virus would miraculously disappear and everything would be all better,” Schumer said.
Schumer said the bill defeated Thursday was “a fairly transparent attempt to show the Republicans are doing something when, in fact, they want to do nothing in reality.”
Nevertheless, both Pelosi and Schumer held out hopes that a failure of the bill would be followed by a new round of bipartisan negotiations — despite the absence of any signs that that is happening.
“I still have some hope once this bill is defeated, if past is prologue, there’s actually a significant chance that the public heat on many Republican senators as they go back home will have them come to their senses, and they’ll start negotiating with us in a serious way,” Schumer said.
Congress does need to take some action this month to avert a government shutdown when agency-wide funding expires at the end of the fiscal year on Sept. 30. Lawmakers are in talks on a short-term spending bill that would extend government spending at existing levels through the election, although they have not yet agreed on how long it will last.
In the absence of new bipartisan talks on a coronavirus relief bill, some senators and aides speculated this week that Congress will move quickly to pass the short-term “continuing resolution” and then adjourn so lawmakers can return home to campaign for reelection.