The Daily - Why $600 Checks Are Tearing Republicans Apart

Episode Date: July 28, 2020

A fight has erupted among congressional Republicans over how long and how generously the government should help those unemployed during the pandemic. But what is that battle really about? Guest: Nicholas Fandos, who covers Congress for The New York Times. For more information on today’s episode, visit nytimes.com/thedaily Background reading: Supplemental checks for laid-off workers are set to stop at the end of July. Republicans and Democrats disagree on what to do next.Why the two parties are unlikely to reach a deal before the end of the month.

From The New York Times, I'm Michael Barbaro. This is The Daily. Today, a fight has erupted among congressional Republicans over how long and how generously government should help the unemployed during the pandemic. Nick Fandos on what that battle is really about. It's Tuesday, July 28th. Nick, tell me about this deadline coming up on Friday. So on Friday, at the end of July, one of the key programs in the $2 trillion economic relief package called the CARES Act that Congress passed this spring to deal with the coronavirus pandemic is set to expire. This is the federal unemployment benefit, this extra $600 that the federal government has been putting into unemployment checks on top of whatever states give

the tens of millions of Americans that are out of work. Right, and the thinking was that state unemployment benefits, which is how most people get by when they are laid off, are kind of stingy. And because these layoffs were so widespread,

the federal government needed to step in in an unusual way. That's right. And, you know, $600 was arrived at by congressional Democrats and the Treasury Secretary, Steve Mnuchin, at something like a kind of average wage that they thought might be lost across the board. And though some Republicans were uneasy, they ultimately set aside their concerns and ended up voting unanimously to put this program and others in place. Our nation needed us to go big and go fast, and they did.

So today, Mr. President, the Senate will act to help the people of this country weather this storm. weather this storm. Right, and I think for many Americans, the sense was that this program, $600 a week from the federal government, would probably last as long as widespread unemployment lasted, stemming from the pandemic. I think that that's right,

that that was the assumption of many Americans, but Republicans never quite viewed it that way. We have spent a lot of money in the last couple of months, but we've done so in the face of an emergency, kind of like the civilian equivalent of World War II. They saw the whole stimulus bill, including this benefit, as a kind of extraordinary measure for extraordinary circumstances, and that this was kind of a bridge to float the economy and float the American people through this period where the government was asking them to stay home

so that we could get the virus under control. Look, I supported every one of these bills that has come through. I agree that we need emergency relief to help people, to help people through the crisis as a short-term bridge loan. But, you know, if that was a gamble, and it was, that this is going to be a temporary thing, Republicans do not come out where they want to. The virus has resurged in many states now across the South and West, you know, in states that are traditionally red states and are represented by Republicans.

So the question today is, where are we and where do we go from here? And the party now has to kind of come to terms with the fact that what they hoped would be a bridge is going to be a lot longer than they initially thought. We had hoped we'd be on the way to saying goodbye to this healthcare pandemic. Clearly, it is not over. Right, which brings us back to this Friday expiration date. So do Republicans have intrinsic objections to just renewing the $600 a week? So for most Republicans, the answer is yes. That $600 figure, as we said,

was arrived at, you know, honestly, but somewhat hastily back in March. And Republicans started voicing concerns at the time. For 68% of people receiving it right now, they are being paid more on unemployment than they made in their job. And they've grown a lot louder since that $600 from the federal government on top of whatever states were giving people that were out of work was simply too generous. And I'll tell you, I've spoken to small business owners all over the state of Texas who are trying to reopen. And actually was disincentivizing and has disincentivized many Americans from going back to work. And they're calling their waiters and waitresses, they're calling their busboys, and they won't come back. And of course they won't come back, because the federal government is paying, in some instances, twice as much money to stay home.

So ideologically, many Republicans in Congress were never comfortable with this $600 benefit at that level in the first place. And then they're certainly not comfortable with extending it into perpetuity. So Nick, with this program running out of time, how is this playing out among the Republicans? So as Republicans are approaching these deadlines at the end of July, they're looking around and seeing a bunch of different inputs that are really difficult for them. On the one hand, Democrats are, you know, unabashedly and enthusiastically pushing to extend this $600 benefit through the end of the year and as long as it's needed. And, you know, at the same time, Republicans are having to reconcile themselves to the fact that,

you know, the virus is spreading around the country. There are signs in the last few weeks that the economy, which was recovering, is starting to potentially soften again. And they recognize for a variety of reasons, economically, for the livelihood of the country, and politically, as they're looking ahead to November's elections, that it's simply not going to be an option not to have a plan. And so Republicans start trying to put together their own proposal, you know, for how to fix unemployment benefits going forward and a range of other programs to keep the economy afloat. And it turns out it's a lot harder than they think it's going to be. What do you mean?

Well, it turns out as they try to, you know, unpack this and get into the details of like, what might we do next, that there's a pretty big split between two different camps of Republicans. I asked my Republican colleagues, what in the hell are we doing? So one of them are the kind of arch conservatives that are really worried about federal spending. People like Ted Cruz. A number of senators at lunch get up and say, well, gosh, we need $20 billion for this. We need $100 billion for this. And they're just really eager to spend.

I'm like, what are you guys doing? Or Rand Paul, who compared his colleagues to a bunch of Bernie bros with the way they were talking. way they were talking. I find it extraordinary that I just came from a Republican caucus meeting that could be sort of the Bernie Bros progressive caucus. And that is a sharp pejorative in the Senate Republican conference. I would think. This is insane. It's got to stop. We're ruining the country. And there has to be some voice left for fiscal conservatism in this country. some voice left for fiscal conservatism in this country. This group is just, frankly, uneasy about the $2 trillion that they spent back in the spring and is not interested in seeing the federal government add to the deficit, add to the debt, and further involve itself in the U.S. economy.

I, for one, am alarmed at where the country is heading. I'm also alarmed that my party has forgotten what they actually stand for. There is no difference now between the two parties on spending. Now, at the other end of the spectrum are a group of more moderate or middle-of-the-road Republicans who are up for re-election this fall and are actually having to face the voters, in many cases, in swing states or blue states, where President Trump and the Republican response to the pandemic have been deeply unpopular. People like Cory Gardner or Tom Tillis.

Well, I think we have to build on what we did with the CARES Act. It was $3 trillion to help individuals, to provide a supplement for unemployment. You know, who have really staked their re-election on the government's response to this crisis and on showing that they are effectively leading the country through one of its most challenging periods in anybody's memory. And joining with them on that side... This crisis is far from over. ...are some of the kind of best- known leaders of the Republican Party on Capitol Hill.

For weeks now, I have made it clear that further legislation out of the Senate will be a serious response to the crisis. So Mitch McConnell, the majority leader from Kentucky, and John Cornyn, a Republican from Texas, who's one of his longtime deputies. As the impact of COVID-19 has grown, so has the need for assistance. Seem to recognize that not only are the fates of individual senators up in the air, but the Republican Party's prospects up and down the ticket this fall may well be tied up into how they are judged to have handled this crisis. And doing what the conservatives want and basically, you know, stopping now and saying we've done what we need to do is not an option for that group.

Nick, how much of that debate you just described is being informed by the political realities surrounding the single most important person in the party at this moment, which is President Trump? I think it's inescapable for elected Republicans. And it's not just the way that the public seems to be viewing President Trump and giving him poor, very poor grades on handling the pandemic, which could hurt the whole Republican Party in November. It's also the kind of erratic nature of his leadership and engagement on this issue, you know, itself. And so they're working with his treasury secretary to iron out the details. But this is not a negotiation that

President Trump is leading or even all that active in. They're trying to do whatever they can to bail out the party not to please President Trump in this case. And that has added another kind of layer of interest and unpredictability to this whole thing, which, you know, we have not seen a lot of in the last three and a half years. And what does that tell you, that they're choosing this moment to do that? are starting to sense that their party is really in trouble, that if things aren't turned around quickly, you know, they may not only lose the White House, but really get wiped out in November and are thinking in different ways about, you know, why that is and what the party may need to look like in a world that's just starting to dawn on them as a possibility of being kind of post-Trump. So in other words, this battle over $600 a week and what this entire new version of a

relief package looks like, it's not really just about what's in a piece of legislation like this. It's about the identity of the Republican Party at a time where it may need a new identity because theoretically Donald Trump could lose and the Republican Party would no longer be just the party of Donald Trump. That's right. for this potentially larger battle to come over what republicanism really looks like after Donald Trump has defined it for four or five years. And, you know, some of these folks are not new to their positions, but they recognize that there may soon be more of a need to kind of assert their views and the primacy of those views

against others in the Republican Party, where does it leave this economic relief package? So it's up to Mitch McConnell, basically, to try and pull together these different factions and arrive at a bill that deals with the expiring unemployment benefits and a host of other kind of programs and priorities, basically to try and reconcile those differences and put together a bill that can be Republicans' starting point when they go to the negotiating table with Democrats.

And so that's where we were by the middle of last week. And as he tries to work out those details with the White House and run it by his Republican colleagues, there's a bunch of snafus along the way. They push past some small deadlines. But in the end, they are unable to introduce their bill because those differences turn out to have been more significant than Republicans even wanted to let on.

So the Republicans cannot come up with any kind of consensus bill to salvage this program that we've been talking about. So as of Thursday morning, no. And as lawmakers head for the exits for the weekend, without a proposal for how to fix a whole host of programs, they have not arrived at a solution on a range of issues, including what to do about this expiring $600 unemployment benefit. But their staff and Treasury Secretary Mnuchin Meadows, the White House chief of staff,

worked through the weekend to try and iron out some of these details. Good afternoon, everyone. We've been, we meaning Senate Republicans in the administration, have been consulting over the last few weeks. By Monday afternoon, what they finally introduce... With what we think is an appropriate amount of additional debt to be added, we think it is about a trillion dollars. ...is a plan that is roughly a trillion dollars. And we've allocated that in a way that we think makes the most sense.

Some of that goes to schools to help them reopen and for more testing and contact tracing. So with that, I'm going to call on my colleagues who have developed the various... And on this key question of unemployment benefits, Republicans propose a real overhaul to the way that they would work conceptually. Do we know who's next? Senator Grassley. Senator Grassley. Okay. Number one, so they say that for the short term, we're going to cut that $600 down to $200 a week.

Big cut. A pretty dramatic cut. So we want to continue to help the unemployed, but we want to encourage work. And we've learned a very tough lesson that when you pay people not to work, what do you expect? And they say that's just going to buy us time over the next few months for us to basically help states set up a new system where what we're going to try and do is make sure that every individual that's unemployed between the state government and the federal government

ends up getting about 70% of what their old wages would have been. We're going to have further tax relief for businesses to encourage hiring and rehiring. And we want to do that to encourage people to get back to work and help the employer in the process support people in the meantime. And so what Republicans are trying to do here is keep a safety net in place, but remove, you know, what they think is hindering people from going back to work. Lastly, I hope that Democrats will come to the table and we work out a bipartisan agreement. Thank you very much. So in other words, if they can get this program up and operating, it will always make sense from a financial point of view for somebody to go and take their old job back or take a new

job back, but not be so draconian that they're, you know, making the economic situation drastically worse or can be accused of forcing people towards soup kitchens or the streets. So this is a classic compromise. In other words, we're going to keep the benefits, but not at $600 a week because they see that as not conservative and not incentivizing an economic recovery. That's right. But remember, this is just kind of the first step. This should have been the easy part for Republicans because what they have coming is negotiations with Democrats who are in favor of keeping the benefit totally as it is and are already lining up to say basically that Republicans are giving a massive economic financial hit to individuals and the

economy right when they need it most. And at this moment where the country's recovery seems to be teetering, you know, is it going to keep going up? Is it about to collapse again? And Democrats are not going to settle for $200 for any period of time. So given all that, what is likely to happen to this Republican bill in the Senate? So the interesting thing about where Republicans find themselves is this bill that they're introducing probably couldn't even pass the Senate just on Republican votes. And that leaves them in a pretty weak position as they head into negotiations with the Democrats. Because remember, to pass anything into law, even if there's a Republican president or a Republican Senate, you need the Democrats to get

it through Congress. And they have a very long and expensive wish list of things that they'd like to see in legislation, and they're not going to be easy on the Republicans. Nick, this might sound like a strange question, but do you think Republicans now regret ever agreeing to these enhanced unemployment benefits? I'm mindful of the fact that it was not a Republican idea. It was Democrats who pushed for it. As you have said, it cuts against a lot of Republican idea. It was Democrats who pushed for it. As you have said, it cuts against a lot of Republican principles, but they agreed to it as a short-term fix. And it turns out it's not going to be a short-term fix because there's nothing short-term about this pandemic. And it is inevitably hard to take something like this away from people once you give it to them. So

is it possible Republicans look back and think we should have never agreed to do this? I think there may be a small subset of fiscally conservative Republicans that feel that way. But my guess is that the vast majority felt like, hey, we did what we had to do back then in the springtime. I mean, the economy was in free fall, remember, and the course of the virus was highly uncertain. And the fundamental problem for them is that they envisioned the federal government having a relatively short-term role to play

in getting the country back on its feet and ready to fight against this virus. And it's just turned out to be, for a lot of different reasons, a much more complicated, prolonged, expensive fight than they wanted. And honestly, Michael, at this point, it's hard to see how this situation resolves itself.

Usually, you know, when you cover Congress for a while, you can kind of see the pattern of how these negotiations will work. But the Republicans really find themselves pretty far upstream without a paddle right now. And there seem to be risks for them and consequences in every direction. And it's going to be a pretty fascinating next couple of weeks to see how and if they can reach an agreement with Democrats and one that some members of the party feel like doesn't completely undermine what they stand for. Of course, weeks is not what people who are on this program have. They have days because this thing really does expire on Friday.

That's right. If many of the people receiving these benefits are living paycheck to paycheck or don't have a lot of savings to fall back on, there can and will be very real consequences to this delay. And that's not to mention the whole host of other programs that are being debated by Congress right now that are touching different aspects of people's lives. The longer this goes on, the effects just get magnified, bigger and bigger and bigger, and it frankly makes the problem even harder to solve.

Thank you, Nick. Thank you, Michael. On Monday night, Democratic leaders, including House Speaker Nancy Pelosi, met with White House officials to begin negotiations over a new economic relief package, including federal unemployment benefits. Suffice to say that we hope that we would be able to reach an agreement.

We clearly do not have shared values. Little progress was made during the two-hour session. But afterward, the Democratic leaders made one thing clear. Congressional Republicans lack the votes to pass their own bill. We'll be right back. We'll be right back. The Trump administration said that its national security advisor, Robert O'Brien, had contracted the virus, becoming the most senior White House official yet to test positive. Meanwhile, the parent company of Google, Alphabet, told employees that they would not be expected to return to the office until next summer,

suggesting that work-from-home policies will extend well past the end of the year. Finally, the Miami Marlins canceled two upcoming baseball games after 12 players and two coaches tested positive for the coronavirus. The outbreak was disclosed just four days after the beginning of the baseball season. During a news conference, the manager of the Washington Nationals expressed alarm over the news. I got friends on the Miami team, and it really stinks. I'm not going to lie, I'm not going to sugarcoat it. See those guys go down like that. It's not good for them, it's not good for anybody. That's it for The Daily.

I'm Michael Barbaro. See you tomorrow.