Congress on Friday passed a two-day spending bill to avert a partial government shutdown while negotiators continue to work on a $900 billion stimulus-package compromise.
House leaders are hoping to vote Sunday on the package, after having passed the temporary funding bill in a 320–60 vote. The Senate approved the stopgap bill by voice vote immediately and President Trump signed it late Friday.
Lawmakers are still seeking to resolve a number of sticking points, however, including a dispute over Republicans’ calls to bar the Federal Reserve from reinstating several pandemic relief programs and to potentially limit some of its ability to fight future financial crises.
Senator Pat Toomey (R., Pa.) introduced a provision that would shut down more than $400 billion in potential Federal Reserve lending powers established under a relief bill passed in March. While Treasury Secretary Steven Mnuchin is closing the programs at month’s end, Toomey’s effort would prohibit the Fed from reinstating the lending next year.
The programs provided loans to small and mid-sized businesses and purchased state and local government bonds, strengthening those governments’ abilities to borrow amid financial fallout from the pandemic.
Brian Deese, President-elect Joe Biden’s choice to chair the National Economic Council, said in a statement that the package “should not include unnecessary provisions that would hamper the Treasury Department and the Federal Reserve’s ability to fight economic crises.”
“As we navigate through an unprecedented economic crisis, it is in the interests of the American people to maintain the Fed’s ability to respond quickly and forcefully,” Deese said. “Undermining that authority could mean less lending to Main Street businesses, higher unemployment and greater economic pain across the nation.”
The potential stimulus deal would provide more than $300 billion in assistance to business and a $300-per-week bonus federal unemployment benefit, as well as the renewal of state benefits that are set to expire after Christmas.
The package also includes $600 direct payments to individuals; funds for vaccine distribution and money for renters, schools, the Postal Service and people in need of food aid.
The stimulus would be added to a $1.4 trillion government-wide appropriations bill that will fund federal agencies through September 2021. The bill is likely to include a final $1.4 billion in funding for Trump’s U.S.–Mexico border wall in order to secure the president’s approval.
Republicans and Democrats have been in a political stalemate for months over the second round of coronavirus stimulus. Republicans’ top priority was another round of “paycheck protection” payments to businesses and the renewal of state jobless benefits for the long-term unemployed.
Meanwhile, Democrats have fought for relief for states and local governments, which Republicans have rejected. Democrats also pushed for a COVID-19 unemployment benefit equal to the one that was provided by the CARES Act, though the party has settled for a benefit that is just half the size.
Biden has promised to secure another stimulus bill after taking office, though with party control of the Senate hinging upon the January 5 Georgia Senate runoff, Democrats may face an uphill battle if they don’t win control of the upper chamber of Congress.