The largest economic stimulus measure in modern history would authorize direct payments to taxpayers and loans to small businesses and create a $500 billion corporate bailout fund.
By Catie Edmondson
WASHINGTON — Trump administration officials and top Democrats finalized an agreement early Wednesday morning on a roughly $2 trillion rescue package to confront the coronavirus pandemic, the largest economic stimulus measure in modern history.
After days of partisan bickering and closed-door haggling, negotiators emerged from their final huddle and announced that they had struck a deal to send relief to workers, businesses, and hospitals devastated by the pandemic and the economic disruption it has caused. The Senate is expected to pass the mammoth bill later on Wednesday and send it over to the House, which is also planning to move quickly to send it to President Trump for swift enactment.
The sheer size and scope of the package would have been unthinkable only a couple of weeks ago in a deeply polarized Congress that has found it impossible in recent years to agree on major new policy initiatives.
“In effect, this is a wartime level of investment into our nation,” Senator Mitch McConnell, Republican of Kentucky and the majority leader, said on the Senate floor in announcing the deal.
Here’s what’s in the Stimulus Package.
The government will send direct payments to taxpayers.
Lawmakers agreed to provide $1,200 in direct payments to taxpayers with incomes up to $75,000 per year before starting to phase out and ending altogether for those earning more than $99,000. Families would receive an additional $500 per child, in an attempt to create a safety net for those whose jobs and businesses are affected by the pandemic.
Unemployment benefits will grow substantially and go to many more Americans.
Lawmakers agreed to a significant expansion of unemployment benefits that would extend jobless insurance by 13 weeks and include a four-month enhancement of benefits. At the insistence of Democrats, the program was broadened to include freelancers, furloughed employees and gig workers, such as Uber drivers.
Small businesses will receive emergency loans if they keep their workers.
The bill provides federally guaranteed loans available at community banks to small businesses that pledge not to lay off their workers. The loans would be available during an emergency period ending June 30 and would be forgiven if the employer continued to pay workers for the duration of the crisis.
“There is broad general agreement that small businesses in this country will not be able to survive unless there is extraordinary assistance,” said Senator Marco Rubio, Republican of Florida and the chairman of the Small Business and Entrepreneurship Committee, who worked with Democrats to create the program. “The goal is to keep employees connected to their employers so that people aren’t just having to stay home and aren’t just feeling the stress of being laid off, but the uncertainty of whether they’ll even have a job to go back to.”
Distressed companies can receive government bailouts — but with strings attached.
Loans for distressed companies would come from a $425 billion fund controlled by the Federal Reserve, and an additional $75 billion would be available for industry-specific loans — including to airlines and hotels.
The creation of the Federal Reserve fund was one of the chief sticking points in the negotiations, as grim memories of the 2008 Wall Street bailout — which activists in both parties came to regard as a flawed program that benefited rich corporations at the expense of American workers — hung over the negotiations. Democrats successfully pressed for immediate disclosure of the recipients and stronger oversight, including installing an inspector general and congressionally appointed board to monitor it. Companies that benefit could not engage in stock buybacks while they received government assistance, and for an additional year after that.
Democrats also secured a provision ensuring that Trump family businesses — or those of any other senior government officials — cannot receive loan money through that fund, though they could potentially still benefit from other parts of the bill.
Hospitals staggering under the burden of the coronavirus would receive aid.
The agreement includes $100 billion for hospitals and health systems across the nation, Senator Chuck Schumer, Democrat of New York and the minority leader, told Democrats in an early morning letter. It also includes billions more, he said, to furnish personal and protective equipment and increased for health care workers, testing supplies, and new construction to house patients.
Lawmakers also agreed to increase Medicare payment increases to all hospitals and providers, the letter said.
Emily Cochrane and Nicholas Fandos contributed to reporting.