The NPR Politics Podcast - Senate and White House Announce Deal On Coronavirus Package

Episode Date: March 25, 2020

Senate Majority Leader Mitch McConnell touted a bipartisan deal to provide emergency funds in response to the new coronavirus pandemic and committed to passing the legislation Wednesday, though some in his caucus have raised objections to a key provision. If passed, the bill would provide cash payments to Americans, help to struggling small businesses and more resources to state and local governments, as well as to hospitals. It also includes a number of accountability measures meant to ensure the funds are used responsibly. This episode: campaign correspondent Asma Khalid, congressional correspondent Kelsey Snell, and chief economics correspondent Scott Horsley.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

Hi, this is Tess and Elena, and we're FaceTiming from two states away during Michigan and Illinois shelter-in-place orders. We're about to watch episode one of season three of Babylon Berlin, one of our favorite shows, that I only first heard about on Can't Let It Go on the NPR Politics podcast. This podcast was recorded at 2.09 p.m. on Wednesday, March 25th. In these days, things have definitely changed by the time you hear this. Here's the show. That's awesome. That is quite clever.

Hey there, it's the NPR Politics Podcast. I'm Asma Khalid. I'm covering the presidential campaign. I'm Kelsey Snell. I cover Congress. And we have a special appearance again by one of our favorite guests. That's NPR's chief economics correspondent, Scott Horsley. Hey, Scott. Good to be with y'all. The big news today is that the Senate has reached a historic deal to inject the U.S.

economy with about $2 trillion in aid. That's a response to the coronavirus pandemic, and it would be the largest rescue package in American history. Here's Republican Senate Majority Leader Mitch McConnell on the Senate floor earlier today. Nobody thinks legislation can end this. We cannot outlaw the virus. And no economic policy could fully end the hardship so long as the public health requires that we put so much of our nation's commerce on ice. This is not even a stimulus package. It is emergency relief. Emergency relief. That's what this is. So today I thought it would be worthwhile to talk about what is in the bill.

But before we dive into that, I just want to get a sense, Kelsey, of what the timeline is. How quickly can we expect Congress to pass this package? Well, the Senate is supposed to vote on it later today. We are, you know, the Senate has not been doing a great job of voting on things or releasing things when they say they will when it comes to this package, in part because it's a $2 trillion package that they've written over the course of only a couple of days. But the goal is to have it approved by everybody in Congress by the end of this week and potentially signed by the president so that checks can start going out, so that people can start applying for programs, basically so that this can get to work doing what it's supposed to do as quickly as possible. So that's a really speedy timeline. And, you know, as we mentioned, this is the largest rescue package in American history. It seems to dwarf the bailout that was passed during the 2008 recession. We're talking about nearly $2 trillion. That's a lot of money. So can you give us just the top lines of what this will cover, some of the interesting nuggets?

Well, I think it's important to start with the fact that, as the majority leader said, this is supposed to be a rescue package. Think about it as like a life preserver for the economy, not as a stimulus. Scott can talk about this a little bit more, but stimulus is a thing where you're trying to get people to go out and keep the economy moving. This is trying to keep the economy from collapsing. While you're at the same time encouraging get people to go out and keep the economy moving. This is trying to keep the economy from collapsing. While you're at the same time encouraging people not to go out. You're encouraging people not to go to work, not to go to the restaurant, not to go shopping, but to give them a little bit of money just to tide them over until we get through this pandemic. And that's why we're seeing a lot of money being spent on getting cash payments out to people,

getting unemployment increased, but also they are spending a lot of money on getting cash payments out to people, getting unemployment increased, but also they are spending a lot of money on sending cash to businesses in hopes of trying to keep people connected to their employers. There are rebates in here that essentially give businesses a write-off just to pay their employees. And while in other situations, Democrats would typically criticize that as kind of a bailout or as, you know, a corporate welfare, the way that it's being described in Congress is that it's a way to keep people from, after this is all over, basically being free agents flailing around the economy, not knowing what jobs they qualify for or where they could work. The hope is at some point, if the quarantines are lifted, businesses will already have their workforce close at hand and can quickly get up and running again. So let's start with cash payments, Kelsey.

That's something, you know, you talked about, we've been talking about it a number of times in recent days. Do we have a sense of how much these cash payments will be and how quickly people can expect to receive them? Well, we know more about how much they are than how quickly people will get them, frankly. At this point, the plan is for $1,200 in cash payments to every person earning less than $75,000. Married couples would each be able to get a check, and families would get $500 per child. So to put it all together, that means a family of four earning less than $150,000 can expect $3,400. Now, the checks start to phase down after $150,000 for a family and completely disappear once people hit the threshold of $99,000 for an individual and $198,000 for a married couple. And while you're talking about checks, in most cases, these would actually

be direct deposits, which is a way that the government can quickly put money in the hands of the people. I believe the Treasury Secretary said that once this bill is passed, he expects the payments could go out in about three weeks. Yeah, that's the expectation. But, you know, some of that is not something they can write into law. It's just a matter of how long it takes for the mechanisms of government to work. And of course, there are millions of people who don't have bank accounts, they would have to get checks, and that might take a little bit longer. And to be clear, Kelsey, this $1,200 sum, that's standard across the entire country. So if you're listening in New York City and you're thinking, well, $1,200 may not help me as much as it could help my parents in Nebraska,

the cost of living is not being factored in. Is that correct? We should be clear that we are basing this off of bits and pieces of the bill and releases from individual senators who have negotiated portions of the bill because as we are taping right now at 2.16 by my clock, we don't have the full bill. So based on what we have been told, the payments are going to be reflective of your 2018 or 2019 tax filing. So if you filed in 2019, it'd be based on that. But if you haven't filed yet, because the filing deadline hasn't happened yet, it'll be based on your 2018 tax returns. So one major sticking point for Democrats was expanding unemployment benefits to help all of the people who are currently out of work in this moment. What happened on that front? Well, the way that the bill is written now is that people who are filing for unemployment would

be able to receive $600 a week on top of whatever their state payments would be from the federal government. It is a dramatic increase. And it would be those full payments for four months, and it would be extended to people who are freelancers or otherwise working in the gig economy. That is another very large expansion. Just to give people kind of an idea, every state does their unemployment process differently. They all offer different lengths of time that you can be on unemployment. They all offer different calculations for how much you receive. The average payment is somewhere around $340 a week right now. And just to give you an idea of the scale, the unemployment part of this package

is around $250 billion. It's comparable to what the price tag is on those direct payments of $1,200 to virtually all adults. So it's a really huge chunk of cash, and that's important because we are about to see a big spike in the number of people who are unemployed. Yeah, it's also roughly comparable to the amount of money that is going to be available to small businesses for loans that can be forgiven in the future if they spend the money on payroll and things like mortgage and rent, just things that are needed just to keep a business running.

All right, well, let's take a quick break, and when we get back, we'll talk more about some of the provisions targeting businesses. Support for this podcast and the following message come from UStudio. Enterprises need to be prepared for whatever comes their way. That's why companies like Facebook, Nike, and Dell use UStudio. UStudio hosts, manages, and distributes private audio and video podcasts for businesses. Companies can send important updates to remote workforces and clients, provide on-demand training and more securely on any device.

Request a free 30-day trial for your company at theletterustudio.com. The coronavirus pandemic is changing everything really fast. So we have created a podcast where you can hear conversations and stories from NPR journalists who are covering the pandemic, the public health fight against it, and how the world is coping. I'm your host, Kelly McEvers. Listen and subscribe to Coronavirus Daily from NPR. And we're back. And Kelsey, does this bill do anything for the current health care system? Yeah. So this a big part of what Democrats were advocating for was additional money to be spent on public health and for hospitals. Now, this is what Chuck Schumer, you may have been hearing him refer to it as a Marshall Plan for hospitals.

What that really means is they want a significant increase in funding for health care professionals to have access to personal protective equipment. We hear people saying it as PPE. So there's $55 billion increase for the health care system on top of what was already in the bill. The new version has $55 billion more. So the idea is that they want to rush money both to state and local governments and to individual hospitals and health care systems to make sure people have the beds needed and the equipment needed to address the problem as people are admitted at rapidly increasing rates. Earlier, we talked about the financial aid that's targeted specifically to individual families. What's being done to prop up businesses? There is money in here for the Small Business Administration to make loans, which in some

cases can be forgiven to smaller businesses. There are emergency grants for businesses. And then there is also money that we expect might be used as sort of seed capital in conjunction with the Federal Reserve to provide loans to small and medium sized businesses. You know, the Federal Reserve has been pouring money into the banking system and in the credit markets to try to keep cash circulating. But they have talked about an additional program that would be aimed at small and mid-sized businesses. We don't really know what the outlines of that are, but it is something the Federal Reserve has never done before. But some of the money in this rescue package might be used as sort of seed capital to assist the Fed in that kind of program. Larry Kudlow, the White House

economic advisor, talked about that being as much as $4 trillion worth of financing to just, again, keep the economy afloat as we try to get through this pandemic. And we should say there is also some targeted money in here for industries that we know have been particularly hard hit, including $50 billion for the airlines. Scott, there was a lot of criticism out of the 2008 stimulus package. Some folks feel that it increased income inequality, you know, by primarily benefiting wealthier Americans. They felt like there was just not enough safeguards and not enough oversight, that CEOs were not held accountable. Are there concerns that this bill could do the same? You know, there was a huge backlash to the rescue that was done in the 2008, 2009 economic crisis. Even though I think most economists would say most of that rescue actually

did help, there was a lot of feeling that it was going to maybe people who had contributed to the crisis itself, that it was going to people who maybe didn't deserve to be helped out. This is going to be an interesting situation because the coronavirus obviously is a threat to all Americans. And will we, from a political viewpoint, view this kind of rescue differently? I don't know. It's possible that whenever the government spends this amount of money, there will be some resentments, there will be some criticisms, especially when it's rushed out the door as quickly as it's happening here. But it is a very different kind of crisis, and maybe that'll change the way people perceive

it. We should say that one of the reasons it's taken a few extra days to negotiate this package is that lawmakers, mindful of all that criticism of what happened 12 years ago, really tried to build in some safeguards, some oversight, and some transparency to this process. Yeah, and again, reminding that we haven't seen the full text of the bill, based on what we have been told, some of those controls that are built into this include banning stock buybacks for the term of the government assistance for big corporations, plus a year after that. So any company receiving a government loan could not do buybacks for the entirety of the time that they have the loan, plus a year after that. There are additional worker protections, which we're waiting to see exactly what that means.

And there is a new inspector general whose job it will be to oversee any money spent by the Treasury Department, any money that goes out the door as part of this loan process and as a part of this entire emergency relief package. And then there's going to be another oversight board associated with the inspector general. So there's supposed to be some independent oversight. And, you know, I think one of the other really interesting things in here is that there's a provision banning the president, the vice president, members of Congress and members of the cabinet from benefiting from any of this money. So if you're the president and own a bunch of hotels, your hotels would not be eligible for any hotel specific bailouts or really any money in this.

All right. Well, that is a wrap for today. To keep up with all of the latest news, make sure you head to NPR.org. And, of course, you can tune in to your local public radio station. I'm Asma Khalid. I'm covering the presidential campaign. I'm Kelsey Snell. I cover Congress. And I'm Scott Horsley. I cover the economy. And thank you for listening to the NPR Politics Podcast.