- The Washington Times - Thursday, April 9, 2020

Senate Democrats blocked a move by the Trump administration Thursday to provide businesses with another $250 billion to keep their employees on the payroll, even as 6.6 million more people applied for unemployment benefits and the three-week toll for job losses reached 1 in 10 American workers.

The partisan Senate showdown began just hours after the Federal Reserve announced $2.3 trillion in emergency lending for businesses and communities to weather the coronavirus pandemic, and Treasury Secretary Steven T. Mnuchin predicted that Americans will return to work next month.

Stocks rose again on those positive developments and closed out a holiday-shortened week with gains of more than 10%. The Dow Jones Industrial Average rose more than 12% for one of its best weeks on record.

Democrats objected to a bid by Senate Majority Leader Mitch McConnell, Kentucky Republican, to approve extra money for the $350 billion Paycheck Protection Program by unanimous consent, which would have allowed passage without requiring a majority of senators to travel back to Washington to vote in person.

Sen. Benjamin L. Cardin, Maryland Democrat, called the Republicans’ move a “political stunt.” He said $100 billion in small-business loans has yet to be distributed through the Paycheck Protection Program, even though the money has been committed.



Before Senate Democrats blocked the proposal, Mr. McConnell pleaded with them to approve the aid swiftly without additions. He said the fund is rapidly running out of money as small businesses flood banks with applications for help. The program provides grants of up to $10 million for companies with fewer than 500 employees to keep paying their workers for two months.

“My colleagues must not treat working Americans as political hostages,” Mr. McConnell said. “To my Democratic colleagues, please, please do not block emergency aid you do not even oppose just because you want something more. Nobody believes this is the Senate’s last word on COVID-19. We do not have to do everything right now. We cannot play games with this crisis.”

Sen. Marco Rubio, Florida Republican and chairman of the Senate Committee on Small Business and Entrepreneurship, said funds for other programs from the $2.2 trillion CARES Act signed into law on March 27 have not yet been disbursed, but “demand for the Paycheck Protection Program remains incredibly high.”

“We are seeing a rate of $3.5 billion an hour on a nearly $350 billion program,” Mr. Rubio said in a statement. “We have days, not weeks, until PPP runs out of money. Today’s unemployment numbers remind us that now is not the time for congressional horse trading or partisan politics. Small businesses are being forced to lay off employees and close their doors. I really hope my Democratic colleagues will reconsider their decision to block more money for PPP.”

Negotiations on this interim bill will continue into next week. House Speaker Nancy Pelosi, California Democrat, said the Republican proposal wouldn’t pass by unanimous consent in the House. Democrats want to add hundreds of billions of dollars more for food stamp benefits, hospitals, states and low-income communities.

“We have made our statement,” Mrs. Pelosi said. “There is a disparity in access to capital in our country. We do not want this tragedy of the coronavirus to exacerbate that disparity or to solidify it.”

President Trump withheld criticism of Democrats at his evening briefing on the coronavirus outbreak. He said only, “We need both Democrats and Republicans to come together to get this legislation completed.”

Asked about some of the Democrats’ priorities, Mr. Trump said, “I support it for the next phase. It’s much simpler in the next phase.”

The Labor Department reported Thursday that Americans filed more than 6.6 million first-time claims for unemployment benefits last week. In just three weeks, nearly 17 million people have applied for jobless benefits as the pandemic shutters restaurants, shopping malls, factories and other businesses not deemed essential.

Just ahead of the announcement of more record job losses, the Fed and the Treasury Department unveiled another major move to prop up the economy: $2.3 trillion more in financing to help support businesses, workers, states and localities.

Fed Chairman Jerome Powell, in a rare move, also spoke in an online broadcast hosted by the Brookings Institution to emphasize that the central bank will continue to use its lending powers “to an unprecedented extent” as needed.

“We will continue to use these powers forcefully, proactively and aggressively until we are confident that we are solidly on the road to recovery,” Mr. Powell said. “People have been asked to put their lives and their livelihoods on hold at significant economic and personal cost. We are moving with alarming speed from 50-year lows in unemployment to what will likely be very high, although temporary, levels.”

He said the Fed “acted forcefully to get our markets working again and, as a result, market conditions have generally improved.”

But the jobless claims and forecasts that the unemployment rate could climb as high as 20% renewed urgent calls for a plan to reopen the economy as soon as possible.

Conservative economist Stephen Moore said the “somber” report on jobless claims “proves that no matter how many trillions of dollars Congress spends or the Federal Reserve prints, there will be no relief for workers until we end the economy lockdown.”

“We may see the unemployment numbers rise from 16 million to 32 million unless we get American businesses and workers back on the job by May 1, where it is safe to do so,” said Mr. Moore, who was an adviser to the Trump campaign in 2016. “Unemployment and business bankruptcies are causing massive pain and suffering for American families. But if we get Americans back to work in the next few weeks, we can have a return to strong growth this summer.”

Mr. Mnuchin gave one of the administration’s most optimistic predictions to date on when people can start going back to work. Asked on CNBC whether the U.S. could reopen for business in May, Mnuchin replied, “I do.”

“As soon as the president feels comfortable with the medical issues, we are [doing] everything necessary [so] that American companies and American workers can be open for business and that they have the liquidity that they need to operate their businesses in the interim,” he said.

Mr. Powell was more cautious about reopening the economy. He said July was a more likely time frame.

“We need to have a plan nationally for reopening the economy,” Mr. Powell said. “I do think that it is time to have a serious public conversation and a lot of analysis about that. We all want it to happen as fast as possible. We all want to avoid a false start. It does depend on people staying home, staying healthy, doing everything we can to get the virus under control. The more we do that, the sooner it will be safer to go back to work.”

House Minority Leader Kevin McCarthy, California Republican, said the country should reopen in “pockets,” starting with regions that haven’t been hit hard.

Democrats viewed the Thursday jobless report as proof that Congress and the administration need to appropriate hundreds of billions of dollars more, at the least, to extend unemployment benefits and funnel more money to hospitals, states and low-income communities, in addition to the extra money for the Paycheck Protection Program.

House Majority Leader Steny H. Hoyer, Maryland Democrat, said the “staggering numbers make it clear that expanded unemployment assistance must be extended beyond July 31, when it is set to expire.”

He said Congress “must continue to do all we can to help businesses large and small keep workers on the payroll during this crisis.”

“House Democrats will continue to push this additional assistance in subsequent legislation to respond to the coronavirus,” Mr. Hoyer said.

Mr. Cardin said Democrats support the Paycheck Protection Program and know it needs more money, but he said the Republican proposal ignores other emergency relief programs for small businesses that also need more money.

He said a Small Business Administration program that provides emergency grants of up to $10,000 within three days has been overwhelmed with applications totaling $11 billion, more than Congress appropriated last month.

“SBA cannot release those funds in three days because they do not have the money to do it,” Mr. Cardin said.

Sen. Chris Van Hollen, Maryland Democrat, introduced an amendment for unanimous consent on the Senate floor after the Republican motion was blocked. He said the small-business loan program has “kinks” that need to be ironed out.

“Yes, we know we need more money for this program,” he said. “But for goodness’ sake, let’s make some bipartisan fixes that allow this program to be better for the very people it’s designed to help.”

Mr. McConnell, in turn, blocked the Democrat’s proposal.

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2021 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.

 

Click to Read More and View Comments

Click to Hide