A bipartisan group of senators unveiled a $908 billion stimulus proposal Tuesday in an effort to break a monthslong impasse that’s now threatening to tip the economy back into contraction.
Neither Republican nor Democratic leadership has signed on to the plan, however, leaving it facing the same long odds that a failed bipartisan House proposal faced before Election Day. President-elect Joe Biden has so far backed House Speaker Nancy Pelosi, who has pushed a $2.4 trillion bill.
Pelosi and Treasury Secretary Steven Mnuchin, who have been the two main negotiators on a stimulus package, are scheduled to talk by telephone later in the day, according to a person familiar with the matter. The topics include the spending bill needed to keep the government running and pandemic relief.
Under the proposed compromise being pitched by the bipartisan group, small businesses would get a roughly $300 billion infusion for a version of the Paycheck Protection Program of forgivable loans and other aid, and state and local governments would get about $240 billion, including money for schools, according to three people familiar with the proposal.
Another $180 billion would go to an extension of pandemic unemployment benefits, providing an additional $300-a-week for four months.
Transportation including airlines, airports, transit and Amtrak would get $45 billion in funding, a person familiar with the plan said. Vaccines, testing and tracing would get $16 billion and health care providers $35 billion.
Some $25 billion would go to rental assistance, $26 billion for nutrition and agriculture, $10 billion for the U.S. Postal Service, $10 billion for child care, $10 billion for broadband and $5 billion for opioid treatment.
The package would include a short-term moratorium on liability lawsuits related to COVID-19 — a more sweeping version of which has been pressed by Senate Majority Leader Mitch McConnell and opposed by Democratic leaders — to give states time to enact their own laws if they choose.
The bipartisan proposal was reported earlier by The Washington Post.
Speaking on the Senate floor Tuesday morning, McConnell made no mention of the new bipartisan push for relief, continuing to blame Democrats for seeking a package that is unrealistic and too costly.
While U.S. stocks have shrugged off the risk of a year-end fiscal cliff, with investors encouraged by the prospect of coronavirus vaccines, economists have increasingly warned that the economy is in danger of a renewed contraction in the first quarter of 2021.
Pandemic-related unemployment benefits are set to expire at year-end, while many businesses are getting squeezed by lockdowns as COVID-19 cases surge. Retail sales gains have weakened, and jobless claims remain stubbornly higher than the peak hit during the 2007-09 recession.
Backers of the new plan include Republican Sens. Susan Collins, Lisa Murkowski, Mitt Romney and Bill Cassidy along with Democratic Senators Joe Manchin, Mark Warner, Jeanne Shaheen and independent Angus King. Members of the bipartisan House Problem Solvers Caucus, which put forward a compromise during the fall that was rejected by Pelosi, also plan to endorse the new attempt.
