Congressional Democrats may lay groundwork this week to pass a stimulus including the checks without Republican support by advancing a budget resolution. Democratic leaders have said they want to see bipartisan negotiations continue, but also to have a Democrat-only option available.
Some Republicans have warned that passing a budget resolution would hurt chances for a bipartisan bill. The resolution would allow for a procedure in the Senate called “budget reconciliation,” under which spending and tax bills can be passed with a simple majority—presumably, all 50 Democrats plus the tie-breaking vote of Vice President Kamala Harris.
The counterproposal announced Sunday by the 10 GOP senators, including Susan Collins of Maine and Lisa Murkowski of Alaska, would send $1,000 checks to Americans below an as-yet unspecified income threshold. Biden will have to determine whether their offer is a starting point for negotiations that may lead to a compromise, or if it signals Republicans will never agree to the expansive stimulus he envisions.
“I support passing Covid relief with support from Republicans if we can get it,” Biden told reporters Friday as he departed the White House to visit troops and health workers at Walter Reed National Military Medical Center in Bethesda, Maryland. “But the Covid relief has to pass. No ifs, ands or buts.”
‘Need The Money’
Psaki asserted Friday that there’s broad public support for policies in the White House stimulus plan and questioned why Republicans oppose it. “Even if this bill moves forward through the reconciliation process—again, a parliamentary procedure—it doesn’t mean they can’t vote for it,” she said at a briefing for reporters.
Biden’s allies say the White House doesn’t want to decrease funding for coronavirus testing or vaccine-related measures in the stimulus. The size and scope of the direct checks, however, increasingly looks malleable—even though members of the president’s economic team argue higher-income families, too, have suffered in the pandemic.
“The checks are better targeted than I think most people realize. Now, that doesn’t mean that they just go to folks at the bottom, but that is because it’s not just folks at the bottom who need the money,” Jared Bernstein, a member of the Council of Economic Advisers, said at a Bloomberg conference last week. “If anybody is listening to me in the $75K to $100K range, many of them, yes, have kept their jobs. Many of them have lost hours. Many have lost wages.”
Biden also holds an expansive view of which Americans are susceptible to economic distress. During the Obama administration, Biden often told aides that nurses or firefighters who earned more than $50,000 were not rich. He insisted it was silly to phase out government aid or tax credits at $50,000, two former Obama administration officials said, because he defined the middle class far more broadly.
In the December stimulus, individuals who earned $75,000 or less, or couples earning $150,000 or less, received the full $600 check, with the amount phasing out above those thresholds. The $1,200 relief checks sent in the spring were also subject to income caps.
“I don’t believe the threshold needs to be lowered,” Senator Ron Wyden of Oregon, the top Democrat on the tax-writing Finance Committee, said on Thursday. “There are so many families who aren’t making what they were in 2019.”
Political Imperative
One Biden ally conceded the stimulus checks are not perfectly designed, as an academic matter, but that the promise helped Democrats win the two Georgia Senate seats. At some point, the political argument for checks eclipsed the economic argument, another ally said.
Amid the debate over targeting the checks to the most needy families comes questions about whether an influx of cash helped fuel recent stock market frenzies around GameStop Corp. and other stocks. Trading among those with annual incomes of less than $75,000 who received payments jumped 53%.
The non-partisan Center for a Responsible Federal Budget estimates that $1,400 checks will add $465 billion to the deficit, the priciest line-item in Biden’s stimulus. The center says expanding unemployment insurance payments and sending aid to state and local governments would both add roughly $350 billion to the deficit, while funding for vaccines and testing clocks in at about $160 billion.
Biden’s top aides denied this week that they’ve considered breaking the bill apart to pass the vaccine and testing provisions alone, which enjoy broad support.
—With assistance from Justin Sink, Jenny Leonard and Steven T. Dennis.