Democrats Shoot Down $1.5T Pandemic Stimulus Compromise

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by Tyler Durden
Tuesday, Sep 15, 2020 - 02:26 PM

Update (1425ET): In what should be a surprise to nobody, House Democrats have completely shot down the $1.5 trillion bipartisan compromise for pandemic relief, arguing "When it comes to bolstering the public health system, supporting state and local governments, and assisting struggling families, the Problem Solvers’ proposal leaves too many needs unmet."

"... The health and economic crisis demands action. That will require President Trump and Republican leaders to come back to the table and work with Democrats to save lives and livelihoods," the Democrats continue.

Full statement here.

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A bipartisan group of 50 House lawmakers will release a $1.52 trillion pandemic stimulus proposal, in the hopes of breaking a months-long deadlock over the next round of relief, according to Bloomberg.

The Problem Solvers Caucus, which has negotiated for weeks with the knowledge of the White House and party leadership will announce detail their plan in an 11 a.m. news conference. Notably, Treasury Secretary Steven Mnuchin hinted at the discussions last month - noting that the White House could accept a $1.5 trillion deal.

The caucus proposal offers key compromises on the two thorniest issues in the stalled talks between congressional Democrats and the Trump administration. On aid to state and local governments, the group is backing about $500 billion, splitting the difference between the $915 billion sought by Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer, and the $150 billion put forward by the White House. -Bloomberg

The group is proposing a $450 per week unemployment insurance extension for eight weeks, which would then convert to a formula to cap payments at 100% of wages or $600 per week, whichever is lower. Democrats have lobbied for $600 per week, while the White House has sought $300 per week - arguing that more money would discourage people from seeking work.

What's more, a $1,200 direct stimulus payment is included in the new proposal - along with a $500 per child benefit.

The “March to Common Ground” framework, led by Caucus co-chairs Tom Reed, a New York Republican and Josh Gottheimer, a New Jersey Democrat, also contains money for Covid-19 testing, schools and childcare, small business relief. It would also link relief to economic metrics, reducing aid if the pandemic abates or extending it if it worsens. -Bloomberg

The new plan comes as negotiations between House Speaker Nancy Pelosi (D-CA), Senate Minority Leader Chuck Schumer (D-NY) and White House Chief of Staff Mark Meadows broke down on August 7 - with Democrats insisting on a $2.2 trillion package, and the White House looking to cap it at $1.1 trillion.