It took all weekend, but US lawmakers did manage to agree on a new stimulus package worth some $900 billion, just “slightly” less than the $3.4 trillion Democrats wanted as part of the original HEROES Act, passed more than seven months ago by the House.
The text of the bill wasn’t finished on Sunday. Congress had to pass another stopgap funding measure, buying everyone another 24 hours to wrap things up.
A House vote on the stimulus bill was expected Monday. Barring another last minute gambit akin to Pat Toomey’s ludicrous decision to hold America hostage pending a debate on the Fed’s 13(3) powers, the Senate will approve the legislation shortly thereafter. It will then be attached to a $1.4 trillion spending bill funding the government through September 30 of next year.
Read more: 160,000 Dead Americans Later, Congress Clears Final Hurdle To New Stimulus Deal
The deal came despite US lawmakers’ best efforts to trip themselves up and otherwise snatch defeat from the jaws of victory, something Congress has become quite adept at.
That it took this long — seven months since the passage of the HEROES Act and five months since provisions under the last relief bill began to lapse — suggests gridlock is now a fixture of American government. That’s arguably been the case for years, but now, the word “gridlock” can be taken in a very literal sense: Basically, the country doesn’t have a functioning legislature.
That would be a rather vexing problem even in good times. It’s wholly untenable during the worst public health crisis in a century.
Thousands of people are dying each and every day from a virus that’s spreading unchecked across the nation thanks to a lackluster federal response and a public that habitually subjugates common sense to misguided notions of “liberty.” The economy is still some 10 million jobs short of pre-pandemic levels.
The US issues the world’s reserve currency. Contrary to popular belief, there are no constraints on that when inflation is subdued and productive resources are underutilized.
With output gaps and labor market slack likely to persist for the foreseeable future, and with the Phillips curve having gone the way of the Norwegian Blue, the decision to spend money in the interest of savings lives, rescuing states, and throwing a life raft to millions of suffering citizens should be no decision at all. It shouldn’t be a debate. It should be the closest thing possible to a blank check, until such a time as people are no longer dying, no longer starving, and no longer jobless. Why this is controversial eludes me, as I hope it does you.
But even if you don’t buy any of that — even if you believe deficits matter and that spending must be “paid for” — there is no denying that the past five months of political theater in Washington have been an embarrassment. And a tragic one at that. I realize I use the figure (below) at least once per day, but I imagine most readers will agree that the urgency of the situation cannot be emphasized enough.
To recapitulate, the stimulus bill calls for direct payments to individuals of $600, $300 per week in supplemental federal unemployment benefits lasting through March, the extension of programs that offer emergency assistance to those who have exhausted state benefits or who are part of the “gig” economy, more than a quarter-trillion in additional funding for the Paycheck Protection program, aid for airlines, funding for the vaccine rollout, money for schools, and food assistance.
“Democrats secured $25 billion in critically needed rental assistance for families struggling to stay in their homes and an extension of the eviction moratorium,” Nancy Pelosi said Sunday evening, adding that $13 billion will go towards “increased SNAP and child nutrition benefits to help relieve the historic hunger crisis that has left up to 17 million children food insecure.”
Just take a moment to let that resonate. America, the richest country in the history of the world, is experiencing a hunger crisis. And it’s hardly just Pelosi sounding the alarm. My contrarian readers will note that SocGen’s Albert Edwards warned on the same thing just four days ago.
There was no agreement on liability protections for employers and no consensus was found on aid for state and local governments. Those issues will have to wait, just as Mitch McConnell insisted they would.
“We are disappointed that Republicans have refused to recognize the need to honor our heroic frontline workers by supporting robust funding for state and local governments,” Pelosi remarked. “State and local governments need much more funding to prevent senseless layoffs and critical service cuts,” she added.
Jerome Powell made similar, albeit less abrasive, comments during his post-FOMC press conference last week. “State and local governments are very large employers,” he gingerly ventured.
For his part, McConnell hailed “the bipartisan breakthrough the country has needed.” That’s probably an overstatement. For one thing, the country needs much more than what it’s getting in this bill. Additionally, it’s barely an “agreement” at all. Lawmakers “agreed” not to gift Americans a government shutdown and a stimulus impasse for Christmas. That’s what counts as a “breakthrough” in D.C. these days.
In a separate statement delivered jointly with Chuck Schumer, Pelosi struck an almost macabre tone.
“The House will move swiftly to pass this legislation immediately, so it can quickly be sent to the Senate and then to the President’s desk for his signature,” the two Democrats remarked. “With the horrifying acceleration of daily infections and deaths, there is no time to waste.”
Merry Christmas America! Enjoy your $600.
There’s a lot riding on the Georgia Senate run-off election. (understatement of massive proportions).
Indeed.
It really is all or nothing… we really are at the point of no return where doing nothing should simply not be an option in the face of the nation continuing to be a going concern.
The “Dark Winter” chart says all we need to know about our collective path the next four months. We’re lucky if we peak out by inauguration date for our 46th president. Then three months back to trough back to only 1,000 COVID deaths per day.
This is happening in America.
A key takeaway from all of this is that we really did live in a period of peace and prosperity in the post WWII system. So irritating it is then that America pissed away its moment of great hegemony, the greatest ever seen, a hegemon with the most potential of all empires to date, as though it never even existed. We pissed away our position and turned ourselves into an embarrassing failure.
In my hope of hopes, let’s please keep our fingers crossed that Trump and Mnuchin do not contrive to undermine the USD position as the reserve currency.
There is a park a 10-minute walk away from where I live. Bunch of tents. Feces, surely, abounds. Garbage. These are people who used to have a domicile not long ago. They had jobs. Across the street, there is a pastry shop. Often, the line is about eight to 12 deep, all separated by the six-feet COVID rule. People walk out of there with their delights, one at a time, directly facing the poverty and hunger, and despair, in the park face on.
When I drive by the park and pastry shop, I have to keep my eyes on the road to avoid driving into a pothole and cracking a control arm on my front suspension.
We have become a country that wholly fails half its citizens. In such a short period of time, we have accepted despair as normal. And this is the richest country ever?
What we have is so precious. It took about 2,000 centuries for us to get where we are. It’s all so fragile. All the more remarkable it will be if we don’t lose it, if we are not in proverbial chains, again, living under government, who, next time, will not be so careless as to let the rabble rule again. After all, tyranny and authoritarianism is historically the most common form of government. Let us have the sense to not go back there.
Well said runamok; “we have accepted despair as normal”. You can now drive most anywhere in this country and get that feeling of despair you describe. It’s all too easy to harden yourself to it, otherwise it overwhelms. A country that HAD so much and can now do so little. A realistic leader would aim for a soft landing and forget visions of renewed greatness. Our dear Senate majority leader could use a Scrooge visitation moment, but from what I’ve seen that only happens in fiction. American democracy is a smoldering ruin where the external shell remains intact while the interior has been gutted. I’m old enough that the country’s fall from grace won’t mean much, but woe be to my children and grandchildren.
“ and no consensus was found on aid for state and local governments.”
More than any Democratic politician, Mitch McConnell is taking action to Defund the Police.