Congress stares down funding cliff for coronavirus aid

Pelosi and Senate Majority Leader Mitch McConnell (R-Ky.) will spend the next few weeks mapping out their parties’ demands for the next round of coronavirus relief — a package initially expected to focus more on the flatlining economy. But new hotspots in Texas, Florida, California and Arizona could force lawmakers to rethink how to control the pandemic, going back to negotiations from this spring.

“The dangerous uptick in cases all across America tells us that we don’t have a handle on this health issue,” Rep. Stephanie Murphy (D-Fla.) said. “We do need to put more resources towards it.”

The U.S. caseload has reached record levels in the past week, now adding more than 50,000 cases per day — up from the previous one-day peak of 36,000 on April 24. The unexpected spike has prompted dire new warnings from federal health officials, with Dr. Anthony Fauci warning lawmakers this week that the number of daily cases could soon reach 100,000 if more isn’t done.

Congress’s fifth coronavirus aid package was always going to be the most difficult to negotiate: The two parties have grown only more divided over what to do after their rare bipartisan agreement in the early months of the pandemic.

Now, Republicans and Democrats will need to revisit the thorniest policy decisions in those early bills — including the extra $600 in additional weekly jobless benefits for the millions of Americans who are unemployed, which will expire at month’s end. They’ll also need to address funding and flexibility for state and local governments. And Republicans insist that any next package must also include liability reform to protect businesses from coronavirus-related lawsuits.

“It’ll be challenging, for sure, but in the end if we need to move and we need to act we will,” said Senate Majority Whip John Thune (R-S.D.). “The key right now is to try to get the White House and Republicans on the Hill in the same place.”

Thune said outreach to Democrats will “happen at some point” but added that right now Senate Republicans have to make their own assessments of where the greatest needs are, including ensuring schools can reopen in the fall.

Complicating it further is a U.S. economy that, on paper at least, shows some signs of improving. More than 4.5 million jobs were added in June, and the unemployment rate fell to about 11 percent, giving Trump and Republicans a much-needed talking point on the economy that could make them wary of renewing the additional weekly benefits.

Still, the unemployment rate remains at an alarmingly high level not seen since the Great Depression with nearly 18 million unemployed in June. And experts are warning that not only will it likely get worse as states start to shutter again to stem the spread of the virus, but the high unemployment rate could last for a decade.

In addition, many Republicans on Capitol Hill share a deep sense of skepticism about the public health measures pushed by Fauci and other health officials. Some point to the rising caseloads that have, so far, avoided the staggering death tolls seen early on in states like New York, and say it’s time for the economy to reopen for those who feel safe.

Sen. Pat Toomey (R-Pa.) said this week he believed the U.S. should not have shuttered the entire economy, noting that more than 60 percent of deaths in his home state took place in nursing homes.

“We obviously did not protect the really vulnerable, but instead we put healthy and much less vulnerable people effectively in quarantine. That in hindsight, we know that was a mistake, in my view. And we certainly should not go back to that,” Toomey told reporters.

Other Republicans have pointed to this week’s drop in the U.S. unemployment rate — sliding to 11.1 percent, down from 13.3 percent — to argue that Congress doesn’t need to deliver as much cash as it did in earlier rounds.

“Our constituents think we’ve already done too much. So one dollar for a lot of our constituents is too much,” Sen. Chuck Grassley (R-Iowa) told reporters.

“I think there is going to be a bill. How big? It’s going to depend on what happens to the economy,” Grassley said, adding that the “good news” from the latest jobs report would point to a smaller package overall.

Sen. Mitt Romney (R-Utah) also called the numbers “very encouraging,” and said that could help shape the final package.

“There are some senators who feel that we don’t need one so I can’t predict exactly what will happen,” Romney said Thursday. “But I know there’s a lot of work going on behind the scenes.”

But Democrats say more assistance is urgently needed — including a cash infusion to state and local governments that have seen revenues dry up and have been forced to lay off public employees.

“We’re about to have massive layoffs across the country, police, fire, first responders,” Rep. Elissa Slotkin (D-Mich.) said, noting that her home state, which has also seen a sharp increase in cases, has a $6 billion budget shortfall. “There’s a cliff there.”

Many Democrats also warn that if the caseloads continue to rise, they will need to go even bigger packages, with billions more needed for public health efforts like contact tracing and hospital capacity — as well as delivering a much-needed jolt to the economy.

“It should have started long before now. I’m afraid that there hasn’t been any serious effort,” Sen. Dick Durbin (D-Ill.) said Thursday, but acknowledged the speed with which Congress can move when it wants to. “I know we can, we did the first Cares Act in eight days.”