Pelosi’s Choice: Time Is Running Out On A Stimulus DealOctober 14, 2020
Just three weeks before Election Day, House Speaker Nancy Pelosi and the White House are at a crucial juncture negotiating another economic stimulus package.
At this point, Pelosi and the White House could reach a compromise package of around $2 trillion that includes $400 a week in extra unemployment benefits, another round of stimulus checks for the majority of Americans, and hundreds of billions of dollars in state and local aid.
But Pelosi trashed the White House’s most recent offer in a letter to her Democratic colleagues Tuesday, saying that the president “only wants his name on a check to go out before Election Day and for the market to go up.”
Pelosi could hold out for a bigger deal around or after Election Day, potentially even waiting for a Democratic majority to take over the Senate and Democratic presidential nominee Joe Biden to take over the White House. But if that gambit fails and Democrats don’t gain the Senate, Republicans could block further stimulus and doom a Biden administration to a double dip recession.
That’s why Pelosi’s next decision is crucial. If she waits too long to reach a deal with President Donald Trump and the Republicans, they may not take it, knowing there’s a lag between when the legislation is signed into law and when people start feeling the positive effects.
This is the decision Pelosi faces: She can help a president she despises while also helping millions of Americans who are suffering, or she can keep holding out for something better that may never materialize.
There are plenty of reasons for Pelosi to say no. The Republican offer still falls short of the $500 billion that Pelosi wants for state and local governments. It doesn’t have the hazard pay that Democrats passed in their own $3.4 trillion bill in May. And Pelosi says the deal lacks enough testing and tracing money to effectively combat the continued spread of the coronavirus, which has surged in recent weeks.
But doing nothing could mean pointless material suffering for millions of people.
Wendy Dean, who lives in Naples, Florida, has been unable to make rent since August, when Congress dropped the extra $600 weekly unemployment benefit that lawmakers implemented in March to help people survive the coronavirus pandemic. Dean’s landlord reminded her in a text message Friday that she needs to get out by the end of December or sooner.
“I will be gone one way or another,” Dean responded.
Dean lost her job as a dental assistant in March when the governor ordered non-essential businesses to shut down to slow the spread of the coronavirus. The extra $600 supplemented the $275 provided by Florida, which has one of the stingiest state unemployment systems.
Even if Congress agreed to a reduced benefit of $400, Dean and everyone else who has been receiving state benefits since July would likely receive a lump sum for the weeks of extra federal payments they missed.
Dean, 48, has been closely following political news and contacting lawmakers to encourage them to strike a deal.
“I never knew who these people were and now it’s my daily thing,” she said.
In the meantime, she’s been selling off possessions and struggling to find an affordable apartment for herself, her teenage daughters and their pets. She’s got health problems, including lupus and rheumatoid arthritis, that make her hesitate to take a low-paying job that would increase her risk of coronavirus exposure.
Millions of other workers are in similar circumstances, but the national unemployment rate fell to 7.9% in August after peaking at 14.7% in April, which Republicans have cited as evidence the economy doesn’t need as much help. But the improving headline number masks some ugly stuff: Early on in the pandemic, the vast majority of people laid off expected to return to their jobs, but as of August, the situation flipped, with most unemployed workers saying they’ve been permanently laid off.
Economists say that if Congress doesn’t dial up another spending bill, the recovery could falter and unemployment could start rising again. One of the best ways to stimulate the economy is to give money to people who lost their jobs, since they’ll spend it quickly on necessities.
Even if Pelosi agrees to a deal with the White House, it’s possible Senate Majority Leader Mitch McConnell and Republicans actually block the deal — or that Trump once again suddenly decides he’s not interested. Senate Republicans have very little appetite for the larger spending package being discussed by the White House. That could, politically speaking, be the best case for Democrats, as Trump and Republicans would take all the heat for blocking relief.
McConnell announced a vote next week on a smaller bill including only aid for small businesses to give his vulnerable members more political cover ahead of the election, ignoring Trump’s calls on Twitter to “Go big or go home” on another stimulus package.
Practically speaking, an actual deal — with real relief for workers and strong unemployment benefits for the millions who are struggling — would overwhelmingly be the best scenario, at least from the perspective of workers at risk of losing access to food and shelter because the pandemic has destroyed their incomes.
As Dean told HuffPost, “I’m trying to look for places to live but I have no money and that’s very depressing.”
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