White House, Senate leaders agree on $2 trillion stimulus deal
To tackle the economic impact of the coronavirus outbreak, White House and Senate leaders agreed Wednesday on a massive $ 2 trillion aid package, considered the largest rescue measure in American history..
«Finally we made a deal», – said Senate Majority Leader Mitch McConnell from the Senate Courtroom.
Efforts to take these measures have become urgent as hospitals, companies, states and individuals ask for the necessary resources to tackle the coronavirus pandemic. He has already influenced the work of the Senate: Senator Rand Paul announced this week that his test has tested positive for coronavirus.
«In fact, this is the level of investment in our country in wartime conditions», – said McConnell, who pledged the bill would financially help Americans by directly subsidizing households, strengthening unemployment insurance, providing hundreds of billions of dollars in emergency loans for small businesses, and more resources for hospitals and medical equipment.
The Senate has yet to release the final terms of the deal. The previous draft, presented on Tuesday, called for cash payments of up to $ 1,200 for individuals, $ 2,400 for married couples and up to $ 500 per child. These amounts decrease if an individual earns more than $ 75,000 or a couple earns more than $ 150,000 per year..
The draft wording also provides for $ 350 billion in small business funds to reduce layoffs and support payroll.
McConnell said the bill «stabilizes key national industries», to prevent as many layoffs as possible. US Passenger and Cargo Airlines have asked the government for $ 58 billion in aid to help deal with a financial blow they say is worse than the 9/11 crisis.
«After five days of tense negotiations, after sleepless nights and marathon negotiations, we have concluded a bipartisan agreement on the largest rescue package in American history.», – Senate Minority Leader Chuck Schumer said.
He advertised «compensation for unemployment», which will cover every American for four months as the US prepares for a historically high number of layoffs and vacations.
The New York Democrat has pledged to oversee the loans the U.S. is offering to businesses, saying that «each loan document will be made public very quickly», to make sure these loans are fair. He also said the inspector general and supervisory board would oversee the loans after Democrats earlier criticized the proposed $ 500 billion enterprise fund leaving too much leeway for the Treasury..
According to him, in the course of the deal, $ 150 billion will be given to states and areas that are fighting the pandemic and are deprived of tax revenues..
McConnell said the Senate will vote and pass the bill later on Wednesday.
Any deal approved by the GOP-controlled Senate must be approved by the House of Representatives under the leadership of the Democrats. It is possible that House Speaker Nancy Pelosi, California, who spoke to Sumer, could demand further amendments to the Senate bill before granting permission..
Pelosi said Tuesday morning if the parties can compromise and get «unanimous agreement», the bill can quickly go through the House of Representatives.
«If we don’t have unanimous agreement, she warned, I have two options with my members: we can call them back to vote to amend this bill, or pass our own bill and then go to the conference with him.».
President Donald Trump on Tuesday expressed optimism about the package, telling reporters at a coronavirus task force briefing: «We are working to host the largest and most daring financial aid package in American history.».
Stock futures were positive on Wednesday after Tuesday’s historic rally.
The day leading up to the talks kicked off with an optimistic note that contrasted with bitter bias that consumed the Senate floor on Monday, when the bill again failed to pass a key procedural hurdle..
Democrats accused Republicans of preferring big business to workers and doctors. Republicans said Democrats are causing unnecessary delay by focusing on issues beyond the economic crisis facing the country, such as giving unions more bargaining power, raising fuel emission standards for airlines, and tax breaks on wind and solar.
Pelosi put forward her own House proposal on Monday, further irritating Republicans.
Trump started the day by pushing for a deal. «Congress should approve the deal without any bullshit today, he wrote Tuesday morning. – The longer it takes, the harder it will be to start our economy».
Uncertainty over the deal shocked the markets. Doctors, workers and citizens said they need money now.
Mnuchin and Schumer met six times on Monday, ending talks on a positive note around midnight. They resumed negotiations again at 9 a.m. on Tuesday.
Just before 11 a.m., Mnuchin, Schumer and Rep. Mark Meadows, Trump’s new chief of staff, met at Sumer’s office..
After the meeting, Schumer announced at a Senate meeting that the negotiators were at «2-yard line». Problems can be resolved within hours, he added..
As negotiations continued longer than Schumer predicted, senior White House economic aide Larry Kudlow said on Tuesday night that the parties had achieved «great progress».
«They’re getting closer and closer, they expect a vote as soon as possible», – said Kudlow.
Optimism about a potential deal helped lift the Dow Jones Industrial Average by more than 11% on Tuesday, the largest one-day gain since 1933..
However, questions remain about the $ 500 billion fund.
On Tuesday, Schumer said the Democrats had achieved «very good results» in its efforts to add «incentives or mandates» for companies receiving federal loans or grants to retain their employees.
It remains unclear whether the government will demand justice for any of the companies it offers assistance, although lawmakers said the government considers demanding warrants as part of its assistance to airlines. Lobbyists told CNBC that there is resistance to actions that weaken shareholders and increase government oversight. Boeing CEO David Calhoun told Fox News on Tuesday that if the government «forcing» package of measures, then «we’ll just look at all the other options. And we have a lot of them».
«It’s just not ideal for us, our suppliers and all those companies that are scattered throughout the United States.», – he added.
Trump previously offered his vision of supporting the aerospace giant, saying: «We must protect Boeing». He also said he would consider persuading the government to acquire stakes in companies that bought back shares..
According to a CNBC source familiar with the matter, lawmakers have considered providing at least some of the assistance to the airlines hardest hit by the crisis in the form of cash grants..
The cash grants would be a victory for airline executives who pleaded with lawmakers that half of the aid came in the form of cash grants, not just loans that Republican senators originally offered. Labor leaders and executives argue that burdening companies’ debt with loans will make it harder to recover. American airlines employ about 750,000 people.
Carriers fought to cut costs, landing hundreds of planes and asking thousands of workers to take unpaid leave. Airlines are also using lines of credit to top up cash to weather a crisis that they say is worse than 9/11..
US airlines’ lobby group, Airlines for America, said the industry is committed not to lay off employees until August 31 if they receive grants..