Democrats and Republicans reached a deal on emergency powers for the Federal Reserve late Saturday night, paving the way for Congress to approve a $1 trillion dollar COVID relief package and a $1.4 trillion bipartisan omnibus spending bill Sunday.
The two parties “fought bitterly over the Fed’s emergency aid programs, which have assisted state and local governments as well as mid-sized businesses,” Business Insider reported Sunday. Republicans have been adamant that increased aid funds should not go to struggling states like New York and Illinois whose financial issues long predate the coronavirus pandemic.
Congressional Democrats, allied with Democratic governors, argued that the Republican proposal to strip funding “could cripple the incoming Biden administration’s ability to respond to the current economic crisis.”
Ultimately, the two sides agreed to a proposal that would honor the CARES Act’s sunset provision on the Federal Reserve lending program — December 31st — but would allow lending to continue if Congress approves it in a separate vote, unconnected to coronavirus relief.
The midnight compromise, ABC News reports, made a Sunday agreement “all but inevitable.” The final bill, which will be paired with a slightly more significant omnibus spending bill, is expected to cost around $1 trillion and will provide continuing Federal supplemental unemployment benefits of $300 and stimulus checks to individual taxpayers in the amount of $600.
“The measure is finally nearing passage amid a frightening spike in coronavirus cases and deaths and accumulating evidence that the economy is struggling,” ABC News said Sunday. “Lawmakers and aides say it would establish a temporary $300 per week supplemental jobless benefits and $600 direct stimulus payments to most Americans. It would provide a fresh round of subsidies for hard-hit businesses and money for schools, health care providers, and renters facing eviction.”
“The measure is being added to a $1.4 trillion spending bill and combined with lots of other unfinished work, including previously stalled legislation to extend tax breaks, authorize water projects, and address the problem of surprise sky-high medical bills for out-of-network procedures,” the outlet added.
A final version of the bill was due on Friday at midnight, but lawmakers passed a two-day emergency extension, in the hopes that a compromise on the COVID-19 relief package could be hammered out in emergency weekend sessions before Congress adjourns for its holiday break.
If the two parties sign off on the bill on Sunday, Congress will vote on the package on Monday.
“An aide to a key GOP lawmaker said it would likely require all of Sunday to finalize and draft the final agreement, which is already guaranteed to be the largest spending measure yet, combining COVID-19 relief with a $1.4 trillion omnibus spending bill and reams of other unrelated legislation on taxes, health, infrastructure, and education,” The Associated Press added.
The two parties have been working on some version of the fourth coronavirus deal since early June when House Democrats, led by Speaker of the House Nancy Pelosi (D-CA) passed the controversial HEROES Act, which extended supplemental unemployment benefits and provided a second round of relief checks to taxpayers but also involved a massive bailout for state and local governments and a multi-billion dollar handout to the United States Postal Service.
The Republican Senate passed their own scaled-back relief bill in early fall, but the two parties could not come to an agreement on the issue before the November presidential election, likely by design on the part of Congressional supporters of Democratic contender Joe Biden.