The Senate on Wednesday will pass the largest, most sweeping economic emergency aid package in the history of the United States of America to address the economic fallout of the coronavirus pandemic. The House will, at some point in the next day or two, follow suit. The deal is done. Votes are coming. Congress is about to leave town. And nobody is quite sure when they'll return.
US lawmakers have reached an agreement on what is, for all intents and purposes, a months-long bridge loan from the federal government to the entire US economy. Think about that. From individuals and families, those employed, furloughed or unemployed, to small businesses barely hanging on and large corporations facing a credit crunch, the federal government is extending more money than it has in history to float the economy. If you pull back and think about it, it's positively stunning -- and underscores just how devastated the US economy already is, and is going to be, in the weeks ahead.
What to watch
- The release of the actual bill text, expected sometime Wednesday morning.
- Senate comes back into session, at which point leaders will likely announce an agreed-upon schedule, 12 p.m. ET.
- Senate vote, expected sometime Wednesday afternoon.
- How the House handles its vote on the package -- and when that vote will take place.
Always good to make sure: Treasury Secretary Steven Mnuchin, the lead negotiator for President Donald Trump on this package, was asked Wednesday morning if the President would sign the agreement.
Mnuchin: "Absolutely, absolutely."
Word of caution
There are a lot of summaries and short-handed lists touting "wins" in this proposal for one side or the other. Those are useful roadmaps, but wait for the bill text. This is an immensely complicated piece of legislation, with many of the parts interconnected in an effort to provide a sweeping economic safety net for the next few months. Each word of how that is expected to take place -- and any additional provisions slipped in for specific businesses, industries or interests -- will be important.
Which 2-yard line were they on, exactly?
The home stretch of negotiations took ... forever. When Senate Minority Leader Chuck Schumer said negotiators were on the 2-yard line Tuesday morning, perhaps reporters should have asked which 2-yard line they were on.
But in all seriousness, legislative drafting takes time. Throughout this process -- and I mean, repeatedly, nearly every hour over five days of negotiating -- there were agreements on concepts, which staff then attempted to turn into legislative text, which one side or the other found unsatisfactory or not in line with the conceptual agreement.
There were specific issues being haggled over between Democrats and the administration until the very end, much to the frustration of Republicans.
See rough bill summary below, based on my read of the latest draft circulated shortly after midnight, and with the caveat that areas were still being drafted well into Wednesday morning.
The Trump Family Prohibition
The final deal includes a prohibition on businesses controlled by the President, Vice President, Members of Congress, and heads of Executive Departments from receiving loans or investments from Treasury programs. The children, spouses and in-laws of the aforementioned principals are also included in this prohibition.
What about the House?
Members of the House, at least the vast majority of them, have zero desire to come back to Washington. That much is clear. Their leaders don't want them to come back to Washington. A report from the House Rules Committee chairman made clear its unwise to come back to Washington. So how does this get done:
- Unanimous consent: This means no member objects and essentially that every member supports the proposal. Given the size and scope of the bill, both sides think this is unlikely.
- Voice vote: Bring up the bill for a vote, the chair says it passes based on who say "yay" in the chamber. Then members who want to vote and make any remarks against the proposal can submit those votes, via proxy, to the Congressional Record.
House Speaker Nancy Pelosi made clear to CNN's Dana Bash on Tuesday she didn't want members to come back to Washington to take a recorded vote. On a call with her caucus Tuesday, however, it was clear there were some frustrations with the developing package, as well as some frustration from moderates on the House Democratic counter proposal.
The reality here is members CNN has spoken to just feel in the dark. Much of what they were learning about the Senate bill was coming from leaks and the media. Pelosi took significant steps to rectify that on the conference call. Expect more of that Wednesday, and a push by the relevant committee chairs to assuage concerns.
House Democrats aren't going to sink or seek changes to the package, people involved say. But more work needs to be done today to get the caucus in the right place.
House Republicans: House Republicans are expecting strong support for the final agreement, according to people who participated in the House GOP whip team conference call Tuesday. Rep. Steve Scalise, the GOP whip, made clear time is extremely important and the "best position" is for Republicans to accept the Senate bill.
They are still trying to figure out the mechanics, like everyone else, particularly since Scalise and others are currently in self-quarantine. That means there will be more communication throughout the day now that an agreement has been reached.
Just about everyone involved in this process believes there will need to be a "phase four" package in the weeks ahead.
"Yes, things will be that bad," one senator told me of his expectation of where things will be in the next month or two.
The big question is how, and this is two-fold: First, on the policy. This latest legislative lift was a significant haul. And rightly so -- it's the largest emergency relief package in US history. But much of the extraneous ideological fights were sidelined or stripped. Not all, but most, making the process smoother.
Any "phase-four" package would likely deep into health- and tax-related areas where there are significant ideological differences.
Expect both sides, in both chambers, to get right to work on drafting "phase-four" ideas. But it's far from a sure thing, which brings me to point number two:
Literally nobody knows when Congress is coming back to Washington after the Senate passes the "phase-three."
"Nobody wants to be here, nobody wants to come back," one senator told CNN. "We want to be home, with our families, helping our local leaders and groups to the extent that we can."
The senator's point wasn't that members didn't want to work. It's that many -- if not all -- genuinely feel unsafe in the Capitol right now and feel like they could be doing more at home.
So when might lawmakers return to Washington once the leave: "Honestly have no idea," the senator said. "Nobody does."
Rough bill summary:
Note: This is as of the latest draft circulated after midnight Tuesday night into Wednesday morning. People directly involved told CNN at the time there were areas still being drafted. Total cost of proposal: $2 trillion
$350 billion for small business loans
The proposal will direct $350 billion, through the Small Business Administration's loan program, to allow the agency to serve as a guarantor for loans of up to $10 million for small businesses to maintain payroll and debt obligations. Banks and financial institutions would provide the loans, backstopped by the SBA. The loans would be forgiven so long as the borrowers document that the money was used solely for payroll expenses and debt obligations.
- Eligibility for loans would be defined as a small business or veterans organization with fewer than 500 employees
- Sole proprietors, independent contractors and self-employed would be eligible
$250 billion in expansion/enhancement of unemployment insurance
- Four months of expanded unemployment benefits (increases overall benefit by $600 a week over that period)
- Jobless benefits would extend to the self employed and "gig" workers unable to work due to the pandemic
- Incentivizes states to pay first week of benefits immediately upon a worker filing, as opposed to the traditional one week lag
- $250 billion in direct payments to individuals and families
- Individuals would get $1,200 each, Couples $2,400 and children $500 each.
- The payment would scale down by income, at a rate of $5 for every additional $100 in income. The phaseout starts at $75,000 in adjusted gross income for singles, $112,500 for heads of household, and $150,000 for married couples filing jointly; it would phase out entirely by $99,000 for singles and $198,000 for couples with no children
- There is no minimum income requirement.
Business tax relief
- Delay of employer payroll taxes
- Relaxes limits on use of net operating losses covering a three-year period
- Expands to 50% the business interest deduction
- State, local, tribal stabilization fund
- $150 billion directed toward states as they face budget shortfalls and gaps due to the Coronavirus pandemic
- $500 billion for loans to distressed companies
Breakdown in assistance:
- $50 billion in loans or loan guarantees to passenger air carriers
- $8 billion for cargo air carriers
- $17 billion for companies deemed "important to maintaining national security"
- The remaining $425 billion would be used to seed a Federal Reserve lending facility for eligible companies, states and localities
- Borrowers cannot engage in stock buybacks during the duration of the loan, plus an additional year after
- Prohibits the compensation of any employee of going over $425,000
- Prohibits "golden parachutes"
- Creates a five-member oversight board, with funding authorization
- Establishes role of a Senate-confirmed inspector general to oversee how the money is spent.
- Temporary guarantee for money market mutual funds with taxpayer dollars
- Significant influx in for hospitals/health care providers
- More than $100 billion for front-line health care providers, crucial medical equipment/PPE
$200 billion-plus for emergency supplemental funding
This includes (this is not an exhaustive list -- parts were still being written this morning):
- CDC: $4.5 billion
- VA: $20 billion
- FEMA: $5 billion
- Airports: $10 billion
- Vaccine development, therapeutics diagnostics and other preparedness needs: $10.5 billion
- National Strategic Stockpile: $1.7 billion
- Public Transportation Emergency Relief: $25 billion