President Joe Biden highlighted his $1.9 trillion coronavirus stimulus bill’s $1,400 payments at a White House meeting Friday, while senators worked into Saturday to pass a bill after a 10-hour delay to resolve a dispute holding up passage.
Senate Republicans already had planned to delay a final vote on the bill as long as possible by offering dozens of amendments, but the Democrats were the ones who responsible for the first holdup as they sought to secure the support of U.S. Sen. Joe Manchin, D-W.Va., to extend unemployment insurance benefits.
Manchin finally agreed to support extending benefits of $300 a week through Sept. 6, down from $400 in the House-passed bill, and to forgive federal income taxes on up to $10,200 of unemployment insurance payments for those making less than $150,000.
“We have reached a compromise that enables the economy to rebound quickly while also protecting those receiving unemployment benefits from being hit with unexpected tax bill next year,” Manchin said in a statement after the deal was reached.
Biden quickly jumped on board.
“This agreement allows us to move forward on the urgently needed American Rescue Plan, with $1,400 relief checks, funding we need to finish the vaccine rollout, open our schools, help those suffering from the pandemic, and more,” White House press secretary Jen Psaki said in a statement.
The compromise cleared the way for voting on the stimulus package to resume, with passage on track to likely pass later on Saturday.
The Democrats spent hours trying to craft an alternative acceptable to Manchin, lest he provide the deciding vote on an amendment by U.S. Sen. Rob Portman, R-Ohio, to reduce the $400 payments to $300 and cut them off in mid-July, while taxing all unemployment benefits.
While Manchin did cross party lines to support Portman’s proposal, allowing to pass by 50-49, the Democratic compromise would supersede it. New Jersey’s Democratic U.S. senators, Cory Booker and Robert Menendez, both voted no.
Republicans have continued to insist that higher unemployment benefits encourage employees to stay home. But studies by the JPMorgan Chase & Co. Institute, economist Ernie Tedeschi and Yale University all found that people would rather return to their jobs, a conclusion also supported by Neel Kashkari, president of the Federal Reserve Bank of Minneapolis.
Before the stalemate began, the Senate rejected an amendment by U.S. Sen. Bernie Sanders, I-Vt., to restore the $15 federal minimum wage that Parliamentarian Elizabeth MacDonough excised from the bill. The legislation is being considered under a procedure known as reconciliation, which allows passage by majority vote but limits what kind of provisions can be included in the legislation.
The amendment failed, 58-42. Booker and Menendez supported the wage hike.
“If any senator believes this is the last time they will cast a vote on whether or not to give a raise to 32 million Americans, they are sorely mistaken,” Sanders said after the vote. “We’re going to keep bringing it up, and we’re going to get it done because it is what the American people demand and need.”
Although Senate Democrats tried to ensure they had the support of all 50 of their lawmakers, Biden pitched the stimulus checks to a paratransit worker, Navy veteran and health center volunteer, who joined him around a table at the White House.
Speaking to reporters at the beginning of the meeting, Biden said the money would “make a big difference in terms of their lives.”
“It’s going to provide immediate relief for millions of people that are going to be able to use it in a very constructive way and also grow the economy in the process,” he said.
The legislation includes $1,400 payments to those making up to $75,000, eliminating them entirely for those making more than $80,000, and $2,800 payments to couples making up to $150,000, ending them for those making more than $160.000.
Those thresholds are less than the $100,000 and $200,000 cutoffs in the House-passed bill, and the Institute on Taxation and Economic Policy, a progressive research group, said the lower income limits would mean that 400,000 fewer New Jerseyans would get stimulus checks.
Senate Majority Leader Chuck Schumer, D-N.Y., said Friday in his floor speech that even with the lower income limits, “the vast majority of Americans will get the full $1,400 we have asked for,” with the legislation providing “direct checks to American workers and families struggling with the cost of groceries, medicine and the rent.”
Also Friday, both supporters and opponents of the stimulus bill seized on the U.S. Bureau of Labor Statistics reporting that 375,000 new jobs were created last month.
Republican Leader Mitch McConnell of Kentucky praised “a jobs report that shattered expectations, nearly doubling the job growth experts had expected to see,” as he argued on the Senate floor against the stimulus bill.
But Psaki said that the economy was still down 9.5 million jobs since the start of the pandemic a year ago.
“This is a larger jobs hole than at any point in the Great Recession,” Psaki said at her daily press briefing. “At this month’s pace, it will take us more than two years to get to pre-pandemic employment levels, and will take even longer at the average pace over the last three months.”
Studies by S&P Global and the Brookings Institution said spending $1.9 trillion would return the economy later this year to what it was before the pandemic. And Moody’s Analytics said the plan would help create 7.5 million jobs this year and another 2.5 million next year.
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