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Stimulus Vote to Test Republican Unity Under Election Pressures

Senate leaders will be trying to hold their parties together for a vote Thursday to advance a slimmed-down stimulus bill.

Stimulus Vote to Test Republican Unity Under Election Pressures
Senate Majority Leader Mitch McConnell, a Republican from Kentucky, speaks to members of the media following the Senate Republican policy luncheon on Capitol Hill in Washington, D.C., U.S. (Photographer: Stefani Reynolds/Bloomberg)

Senate leaders will be trying to hold their parties together for a vote Thursday to advance a slimmed-down stimulus bill that Democrats have already rejected, with both sides jockeying for advantage in public perceptions two months before the election.

A far bigger task looms for Republican Majority Leader Mitch McConnell, who crafted a White House-backed proposal that may not go far enough to help vulnerable incumbents in his caucus. That was the price of securing the votes of fiscal hawks worried about adding to a deficit already forecast at $3.3 trillion this year.

Stimulus Vote to Test Republican Unity Under Election Pressures

Democratic Minority Leader Chuck Schumer’s job is to maintain solidarity among his caucus in favor of what he terms a comprehensive response to the Covid-19 crisis, which has left more than 13 million Americans still unemployed. White House Chief of Staff Mark Meadows Tuesday claimed a “groundswell” of support among rank-and-file Democrats for a deal.

With financial-market volatility picking up -- albeit for reasons outside of economic policy -- public attention might start turning toward the monthlong impasse over coronavirus relief. That in turn could put pressure on members in each party to be seen doing more to break the logjam.

“September is likely to be the last opportunity to pass fiscal measures until well after the election and potentially early 2021,” Goldman Sachs Group Inc. economists including Joseph Briggs and Alec Phillips wrote in a note to clients on Tuesday. “Incumbents of both parties might be wary of inaction for such a long period.”

Winnowed Down

McConnell on Tuesday billed the vote on a so-called skinny bill as an opportunity of outing Democratic leaders for “stonewalling” on assistance that most agree is needed -- including supplemental unemployment insurance and expanded aid for small businesses.

While a fraction of the $2.2 trillion package that Democrats are pushing for, and smaller even than an earlier $1 trillion Republican plan, the Senate majority leader is framing his bill as targeted to the key areas still in need of assistance.

McConnell said Wednesday “I’m optimistic we’ll have a good vote on our side.” But even if the party delivers 51 votes, that number would not be enough for passage. It needs the backing of 60 members to advance to the Senate floor under filibuster rules. Democrats can defeat it should they stay unified.

The proposal will fail to get to a floor vote, Schumer said on Wednesday. “Clearly, Leader McConnell is not interested in passing a bill.”

As it is, the go-small strategy has already put Republican senators including Susan Collins of Maine in a tight spot. Behind in opinion polls, she’s running on her ability to get things done in a sclerotic Washington, including the Paycheck Protection Program she co-authored, which was tapped by numerous small businesses in her state.

Rejected Items

While the skinny bill includes $258 billion for another round of checks for smaller employers, it doesn’t include the bipartisan proposal Collins, several other Republicans and Democrats have put forward. That item offered $500 billion to help state and local governments avoid cutting jobs or tax increases, given slumping revenues.

McConnell’s plan also would forgive as much as $10 billion in loans to the U.S. Postal Service previously authorized by Congress -- but that’s far short of the $25 billion backed by Collins along with other endangered Republicans including Cory Gardner of Colorado and Steve Daines of Montana.

Other proposals from endangered Senate Republicans that haven’t made it into McConnell’s plan include a proposal from Joni Ernst of Iowa to suspend payroll and income taxes for essential lower-income workers and one from Martha McSally of Arizona to give taxpayers as much as $4,000 each to take a domestic U.S. vacation.

Keeping the package limited was the cost of bringing other Republicans on board. Pat Toomey of Pennsylvania said Tuesday he intended to support the bill after it was slimmed down.

Pessimism on Deal

Despite the optimism expressed by Meadows, moderate Democrats showed little enthusiasm for the skinny bill.

“He wants to give people a chance to say they voted for something,” Senator Joe Manchin, a West Virginia Democrat who has worked with Republicans on legislation, said of McConnell. House Speaker Nancy Pelosi was more biting Tuesday, calling the bill “fraudulent,” given the knowledge of Democratic rejection.

The stalemate leaves open the risk of no stimulus on the immediate horizon. Republican Senator Ted Cruz concluded as much on CNBC Wednesday, saying “I don’t think Congress is going to end up passing anything between now and election day.”

One group still hopeful of a compromise is the Problem Solvers, a bipartisan caucus of House members, which continues to work on a middle ground between the Democrats’ $2.2 trillion proposal and the previous Republican plan for a $1 trillion package.

Both Democratic and Republican leadership in the House have been dismissive of the Problem Solvers discussions, however, according to people familiar with the matter. Pelosi as it is faces some dissatisfaction about cutting back from a previous $3.4 trillion bill, a Democratic official said.

Treasury Secretary Steven Mnuchin said on Wednesday when asked about whether a relief package will be enacted: “I don’t know. We’ll see. I hope there is. It’s important to a lot of people out there.”

Mnuchin also said to reporters that his focus for now is instead on a bill needed to keep the government funded beyond the Oct. 1 start to the next fiscal year.

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