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Senate Republicans finally unveiled their proposal for a new coronavirus stimulus package on Monday—a roughly $1 trillion plan known as the HEALS (Health, Economic Assistance, Liability Protection, and Schools) Act, which follows up on the $2.2 trillion CARES Act passed by Congress in March.
Like its predecessor, the bill seeks to aid American households and businesses suffering the economic effects of the coronavirus pandemic. That includes another round of direct “economic impact payments”—more commonly known as stimulus checks—to American taxpayers, as well as extended (albeit more limited) federal unemployment benefits and a renewal of the Paycheck Protection Program for small businesses.
Already, the HEALS Act is receiving criticism from observers over everything from its rollback of the CARES Act’s more lucrative unemployment benefits to its inclusion of questionable “pork barrel” provisions. The bill certainly appears far less generous—and less expensive—than House Democrats’ $3 trillion HEROES Act proposal earlier this summer.
One left-leaning political initiative, the progressive Economic Security Project, struck back against the bill on Monday. “Instead of cutting unemployment benefits, Congress should be working to get money to people as quickly as possible,” according to Adam Ruben, director of Economic Security Project Action. “People are hurting now. The economy is on the brink of the abyss. We cannot afford to wait any longer.”
Of course, it remains to be seen what the HEALS Act will look like in its final form. Should they wish to pass another stimulus bill to aid the American people, Republicans and Democrats on Capitol Hill will have to come together and strike a compromise. But with the GOP’s initial proposal now out in the world, here’s why some of the HEALS Act’s opponents believe the bill doesn’t do enough to address the U.S. economy’s current, coronavirus-related struggles.
Another $1,200 stimulus check ‘isn’t enough’
Like the CARES Act, the GOP proposal includes a one-time stimulus payment of up to $1,200 for qualified American taxpayers under certain income thresholds. For some critics, a one-time payment isn’t enough, especially for the Americans that are struggling the most.
“Rent is due every month. Medical bills come every month. People need to put food on the table every month, but the economy will not recover in a month,” according to the Economic Security Project’s Ruben.
To that end, the group backs the idea of not just one, but a series of “recurring cash payments” to Americans as a “no-brainer solution” to helping Americans get through the pandemic. Such an idea has already been proposed on Capitol Hill by the likes of Sen. Kamala Harris (D-Calif.), though it’s yet to receive much traction.
The Economic Security Project notes that an overwhelming majority of Americans spent their initial stimulus check on essentials like food, rent or mortgage payments, and utilities. With the pandemic continuing to hamper the U.S. economy, the group believes that the CARES Act’s followup “must include multiple rounds of payments” to get American households through this time.
Federal unemployment benefits will be cut by two-thirds
Tens of millions of Americans—particularly those formerly working in the service and retail sectors—have relied on the CARES Act’s historic expansion of unemployment insurance to make ends meet while the pandemic ravages huge swaths of the U.S. economy.
The GOP’s proposal would reduce the CARES Act’s federal unemployment benefit, which supplements existing state unemployment benefits, from $600 per week to only $200 per week through September, and would subsequently cap the benefit at 70% of an unemployed person’s previous income through the end of this year.
The Economic Security Project, among other progressive groups, has called on the HEALS Act to continue federal unemployment insurance “at 100% of the levels enacted in the CARES Act.” House Democrats’ HEROES Act proposal would have extended the $600 weekly benefit, which expires this month, through January 2021; it also would have expanded state unemployment insurance to part-time workers, gig workers, independent contractors, and the self-employed (who are eligible to receive such benefits through the end of this year under the CARES Act) through March 2021.
Already, it appears that some state lawmakers, like those in California, are prepared to step in and fill the breach should federal unemployment benefits prove inadequate.
Renewed Paycheck Protection Program ‘far and away’ from small businesses’ needs
The HEALS Act would bring the Small Business Administration’s Paycheck Protection Program back to life—providing $190 billion in forgivable loans to businesses with fewer than 300 employees that have seen their revenues badly damaged by the pandemic.
But already, some small business groups are worried that the GOP’s proposal has shortcomings as far as PPP is concerned. John Arensmeyer, founder and CEO of the Small Business Majority, described the HEALS Act’s PPP framework as “simply a starting point” that is “far and away from where it needs to be to ensure Main Street can recover” from the pandemic.
“Namely, the requirements [for businesses] to qualify for a second PPP loan are too burdensome; more reforms will need to be made to ensure this next round of PPP does not favor the well-connected over true small businesses again; and special emphasis needs to be placed on ensuring women- and minority-owned businesses are not shut out of additional funding,” according Arensmeyer.
Households with children and dependents need more help
Whereas the CARES Act supplemented taxpayers’ stimulus payments with an additional $500 per each child under 17 years of age in their household, the HEALS Act expands that $500 credit to include all dependents—not just children—living under a taxpayer’s roof.
Still, some critics believe that’s not enough. The Democrats’ HEROES Act proposal would have provided an additional $1,200 per dependent to each household’s stimulus check, up to a cap of three dependents. That would have meant that a married household living with three or more children would have been eligible for a $6,000 payment.
Such financial assistance would go a long way for those struggling to make ends meet while taking care of children and other dependents during challenging economic times.
“This pandemic has caused schools and child care [centers] to close, millions of parents to lose jobs, and created a slew of additional costs to make ends meet,” accordion to the Economic Security Project. The group cites recent data indicating that one in five American households with children can’t afford enough food to feed their kids in calling for children and dependents to be “eligible for the same [stimulus] payment amount as adults.”