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Early divisions as Congress weighs next help for economy

Tuesday, March 31, 2020 | Alan Fram, Associated Press

Nancy Pelosi, Kevin McCarthy
House Speaker Nancy Pelosi of Calif., right, speaks with House Minority Leader Kevin McCarthy of Calif., left, as she holds up the Coronavirus Aid, Relief, and Economic Security (CARES) Act after signing it on Capitol Hill, Friday, March 27, 2020, in Washington. The $2.2 trillion package will head to head to President Donald Trump for his signature. (AP Photo/Andrew Harnik)

WASHINGTON (AP) — The bipartisan partnership that propelled a $2.2 trillion economic rescue package through Congress just days ago is already showing signs of strain, raising questions about how quickly calls for massive followup legislation may bear fruit.

House Speaker Nancy Pelosi, D-Calif., and fellow Democrats are collecting ideas for the next stab at stabilizing an economy knocked into free fall by the coronavirus outbreak. Their proposals include money for extended unemployment benefits, state and local governments, hospitals and a job-creating infrastructure program, plus expanded job protections and benefits for workers.

“It's a wonderful opportunity," Pelosi told reporters this week, “because I think our country is united in wanting to not only address the immediate needs of the emergency and mitigation for the assault on our lives and livelihood, but also how we recover in a very positive way.”

Congress' top Republicans say not so fast. They want lawmakers to gauge how well the huge, newly minted bailout programs are working and how the economy is behaving. And they're accusing Pelosi of planning to use the next bill to win Democratic priorities like environmental requirements and moving the country toward ballot by mail elections.

“Let’s see how things are going and respond accordingly,” Senate Majority Leader Mitch McConnell, R-Ky., said Tuesday on Hugh Hewitt's talk radio show. He said that could take weeks and added, “I would think any kind of bill coming out of the House I would look at like Reagan suggested we look at the Russians — trust, but verify."

“I'm not sure we need a fourth package,” House Minority Leader Kevin McCarthy, R-Calif., said on Fox News’ “Sunday Morning Futures.”

Throwing another wild card into the mix, President Donald Trump on Tuesday blindsided congressional Republicans and embraced using the next round for a massive infrastructure package. Many in both parties have supported such a program before, but some Republicans have opposed it as too costly and there have long been crippling disagreements over how to pay for it.

“It should be VERY BIG & BOLD, Two Trillion Dollars, and be focused solely on jobs and rebuilding the once great infrastructure of our Country! Phase 4,” Trump tweeted.

Trump later told reporters that the Federal Reserve cutting its benchmark interest rate earlier in March made it an ideal time to pursue an infrastructure deal. “Our interest payments would be almost zero, and we can borrow long term,” Trump said. “People want to be in the United States, they want to be invested in the United States."

There seems little doubt that if the economy remains near its current morbid state, the major question facing lawmakers will be what the next bill should look like, not whether to have one. Growing numbers of business close by the day, consumer spending is plummeting and millions are losing jobs as much of the country shelters at home, a devil's brew that could be lethal for politicians to ignore before November's presidential and congressional elections.

“I think there's a deal to be had this time" on infrastructure, said Rep. Greg Walden of Oregon, top Republican on the House Energy and Commerce Committee. Still, he said reaching agreement on another expensive package could be harder after last week's enormous $2.2 trillion bill.

“We've already broken apart our grandkids' piggy bank. We're now getting into the great-grandkids' piggy banks, so let's be thoughtful on this,” he said.

Stephen Moore, a former Trump senior adviser now with the conservative pro-business Committee to Unleash Prosperity, said he envisioned major problems for Congress in reaching an agreement. He said while the economy will likely need another large cash infusion to recover, Democrats pushing more spending will clash with Republicans eager to use tax cuts instead, such as suspending employers' payroll tax like Trump has proposed.

“This will be World War 4,” he said.

Clearly the size, contents and timing of the next bill are in play. And the Trump administration, lawmakers, lobbying and ideological groups are all pushing ideas.

Discussions within the White House have been limited. Trump has publicly suggested he'd support extra money for state and local governments and for some type of hazard pay for front-line medical workers.

Former Vice President Joe Biden, Trump's likely Democratic presidential opponent, has said he wants additional direct payments to people beyond the one-time $1,200 amounts many adults will get. He also wants increased Social Security benefits and some student loan forgiveness.

Pelosi's proposals include easing limits on federal deductions for state and local taxes, a curb the GOP-controlled Congress enacted in 2017 that's hit high-income, Democratic-leaning states the hardest. Her suggestion has run into opposition from both parties.

House Energy and Commerce Committee Chairman Frank Pallone, D-N.J., said he'd like to create a federal office for overseeing national supply chains disrupted by the crisis. Rep. Robert Scott, D-Va., who chairs the Education and Labor Committee, said he'd like to expand safety regulations to cover airborne pathogens like the coronavirus and to cover essential workers like grocery store employees.

Others suggesting ideas include Sen. Lisa Murkowski, R-Alaska, who said she'd like to address the strains the virus and the resulting confinement of people at home are putting on mental health.

“We see domestic violence. We see substance abuse,” she told reporters. “We see levels of addiction that we wish were not present with us. And so it's something that I don't think we have fully factored yet.”

Kevin Kuhlman, chief lobbyist for the National Federation of Independent Business, the nation's largest small business trade group, said his group is monitoring how the new bill's $350 billion in small business loans is being administered. For the next measure, he said his group is watching whether additional money is needed and if changes are needed in how the money is distributed.

Michael Strain, director of economic studies at the conservative American Enterprise Institute, said the next bill could be used to revisit the $2.2 trillion measure if some programs have problems. He said there could be a need for spending another $500 billion or more, or for significantly less support.

“There are all kinds of questions about what the world will look like in June,” Strain said.

___

Associated Press writer Zeke Miller contributed to this report.


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