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After several delays and much debate, the U.S. Congress has agreed to a $900 billion stimulus package for the American economy. Having spent more than $3 trillion in transfers at the beginning of the pandemic, Republicans and Democrats had been, until today, unable to negotiate a second stimulus plan for the economy.
“We finally have the bipartisan breakthrough the country has needed,” said Senator Mitch McConnell, Senate majority leader. “Now we need to quickly finalize the text, avoid last-minute obstacles and cooperate to move this legislation through both chambers,” he concluded.
The stimulus agreement will provide a direct payment to Americans, transfers to small businesses, additional unemployment insurance payments and a budget for a massive vaccination campaign. The bipartisan commission wrapped up the final details of the bill Sunday after resolving disagreements over Federal Reserve loans to the government.
The spread of coronavirus infections, which seriously affects U.S. economic activity, and the termination of the first stimulus package were the reasons that pressured lawmakers from both parties to reach an agreement this week.
Negotiations accelerated last week when the heads of both parties agreed to simultaneously remove two of their conditions from the table: on the Democrats’ side, additional transfers to state and local governments, and on the Republicans’ side, legal liability protection in case of coronavirus suits against businesses.
How will the stimulus package work?
A total of $325 billion will be allocated to small businesses; theaters and entertainment companies will have $15 billion for payroll, as will the airlines.
As for assistance to households, $166 billion in direct payments and $120 billion in unemployment benefits were approved. Direct checks will be $600 per adult in the household and an additional $600 for each child, transfers that will gradually decrease for people with incomes over $75,000 and couples with incomes over $150,000. The White House pressed lawmakers to include direct-to-family checks in the legislation.
Stimulus assistance also includes an additional $300 check in federal unemployment benefits for those who have had to apply for layoffs because of the pandemic.
Households with members who do not have social security numbers will be subject to partial support. Dependents under age 16 do not qualify as transferable. There will also be no direct transfers for college debt payments or for persons with physical disabilities.
There will be $82 billion in transfers for schools under the new stimulus package and another $10 billion for child care.
Congress also appropriated a budget for pandemic care of $69 billion, of which $47 billion will go to the mass vaccination campaign and another $22 million will go to Covid-19 testing and tracking programs,
The additional stimulus includes $25 billion in rental assistance, extends a moratorium on evictions, and approves $13 billion in funding for food stamps and child nutrition benefits.
Another $30 billion goes to transfers to small banks, early childhood care, and broadband network maintenance. Finally, the stimulus allocates $45 billion in subsidies to the transportation sector, and $26 billion to agriculture.
Although the agreement succeeded in satisfying both parties, this will not be the last stimulus the economy will receive. Both House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer said they will press President-elect Joe Biden for additional fiscal stimulus when he becomes President of the United States.
Economist, writer and liberal. With a focus on finance, the war on drugs, history, and geopolitics // Economista, escritor y liberal. Con enfoque en finanzas, guerra contra las drogas, historia y geopolítica