McConnell Rebuffs Trump, Democrats by Blocking $2,000 Checks

Senate Majority Leader Mitch McConnell on Tuesday blocked an attempt by Democrats to force quick action increasing direct stimulus payments to $2,000 as President Donald Trump warned that failing to act now amounted to a “death wish” by Republicans.

McConnell objected to a motion by Senate Minority Leader Chuck Schumer to approve by unanimous consent a stimulus-checks bill that passed the House on Monday. He also blocked a motion by Senator Bernie Sanders of Vermont to vote on the stimulus checks immediately after the Senate votes on overriding Trump’s veto of a key defense policy bill.

McConnell Rebuffs Trump, Democrats by Blocking $2,000 Checks

Floor requests to immediately pass legislation are frequently criticized as stunts, but this episode highlights how unlikely it is that the Senate will pass a bill increasing the payments before Congress adjourns Sunday.

McConnell said the Senate would consider higher stimulus checks in conjunction with two other Trump complaints unrelated to the pandemic relief bill he signed into law: An investigation into alleged election fraud and reworking a law that shields technology companies from liability for user content.

McConnell Rebuffs Trump, Democrats by Blocking $2,000 Checks

“This week the Senate will begin a process to bring these three priorities into focus,” McConnell said, without explaining when or if a vote would happen.

But Trump wasn’t satisfied. In a tweet Tuesday afternoon, he said the GOP should pass the bigger stimulus payments “ASAP.” He also said Republicans should deal with his other demands regarding the election and tech companies.

McConnell initiated a process later Tuesday to put a bill on the Senate calendar that would increase the direct payments to $2,000, create an advisory committee to review 2020 election results and repeal the provision of the 1996 law that protects technology companies from liability, according to a copy provided by Schumer. Such a combined proposal will likely draw opposition from both parties.

Schumer, in a statement, said McConnell’s proposal is an attempt to end the chances of sending out larger stimulus payments.

The $600 payments authorized by the coronavirus relief bill Trump signed into law Dec. 27 are already in the process of going out, according to Treasury Secretary Steven Mnuchin. He said paper checks will be mailed Wednesday and people can check the status of their payments on the Internal Revenue Service website.

Despite the push by Trump, spending $464 billion on higher stimulus checks has divided Republicans, some of whom are increasingly focused on the burgeoning national debt. Only 44 Republicans joined 231 Democrats on Monday to pass a House measure increasing the payments to $2,000. In the Senate, just a handful of Republicans are now publicly on board, including Marco Rubio of Florida and Missouri’s Josh Hawley.

Armed Services Chairman Jim Inhofe, an Oklahoma Republican, said he would likely vote against $2,000 checks because of deficit concerns.

“I’d have a hard time supporting that” he said. “It’s such a huge number.”

Political Impact

The GOP tension comes at a crucial time for Republicans who are fighting to maintain control of the Senate in a pair of Georgia runoff elections on Jan. 5. On Tuesday, both GOP incumbents in those races, David Perdue and Kelly Loeffler, also came out in favor of the $2,000 checks.

McConnell has several options to tackle the direct-payment conundrum Trump put him in. With the Schumer attempt blocked, McConnell could point out that there is not agreement to process the House bill on the floor by the time the current session of Congress ends on Jan. 3.

That approach could risk a backlash from Trump and his supporters, however. McConnell also could promise to work on the matter in the next Congress that starts next week.

Kicking the can down the road leaves McConnell with another problem, with Sanders, an independent who caucuses with Democrats, saying he will delay any attempt to override Trump’s veto of a separate defense bill this week unless there is a vote on stimulus checks.

Another option would be for McConnell to present his own bill, combining higher stimulus checks with other the two other issues that Trump wants addressed.

But combining those elements into a package would poison a stimulus-checks bill for many Democrats. It would likely fail if brought to a vote.

Sanders said he didn’t know what McConnell has in mind but the majority leader shouldn’t complicate a bill by adding Trump’s other demands.

“The House passed, to their credit, a simple straightforward bill,” Sanders said in a brief interview Tuesday. “Let’s not muddy the waters. Are you for $2000 or not? Let’s not talk about so-called voter fraud or abortion or anything else.”

Sanders’s demand for a vote on higher stimulus payments led him to block a separate Senate effort on Wednesday to unanimously override Trump’s veto of this year’s defense policy bill. That veto override, which was approved by the House Monday, will go through the full Senate process to get a vote before Sunday.

Democratic Opening

Democrats, for their part, are relishing the political turmoil for the GOP and hoping it will give them a chance to flip the Senate to help enact President-elect Joe Biden’s far-reaching agenda.

“The House and the President are in agreement: we must deliver $2,000 checks to American families struggling this Holiday Season,” House Speaker Nancy Pelosi said in a tweet, calling on the Senate to pass the higher payments.

Although Biden on Monday said he supports the $2,000 payments, it is unclear if he will make them a priority in his stimulus proposal after the Jan. 20 inauguration if Congress fails to pass them before then.

The nonpartisan Committee for a Responsible Budget estimates that the bigger payments would raise disposable income in the first quarter to as much as 25% above pre-pandemic levels. The legislation would produce an additional 1.5% in GDP output, but not all of the growth would occur in 2021, according to Marc Goldwein, an economist who co-authored the CRFB projections.

Yet many Republicans had opposed stimulus payments larger than the $600 in the existing law, in part over concerns about the price tag. Bumping the payments to $2,000 would cost roughly $463.8 billion, according to estimates by the staff of the Joint Committee on Taxation.

©2020 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.