Virus Stops Economy Cold

Update 422: Virus Stops Economy Cold;
Congress in Search of Plan, Consensus

Legislation to address the impact of the coronavirus is making its way through the Congressional mill. An initial $8 billion targeted relief package was enacted last week. This week, the House and Senate have taken a week to hammer out the finer points of a much bigger package, which we outline below. 

A third, still bigger package — possibly $1 trillion — is on deck. But elusive, as the virus spreads and the legislation grows in scope and scale, is a consensus on how best to prevent or minimize the inevitable large-scale economic damage ahead. 

20/20 Vision hosts a Progressive Congress Action Network call tomorrow (Thursday), 5pm ET, with Jared Bernstein, former Chief Economic Advisor to VP Joe Biden and Mark Zandi, of Moody’s Analytics on the economic policy choices before Congress. 

Best,

Dana

______________________________________

After Congress passed an $8.3 billion coronavirus relief bill on March 5, attention turned to the second coronavirus package now making its way through Congress. Early Saturday morning, the House passed the Families First Coronavirus Relief Act, H.R. 6201, providing $104 billion in funds for free universal testing, supplemental unemployment insurance, a six-month holiday for federal student loans and mortgages, and tax credits for companies that provide paid leave, among other things. The Senate is voting now, but passage of the bill is assured.

Below, we review the legislative state of play surrounding the coronavirus and what economic concerns must be addressed by future legislation.

What’s in Corona II: Relief and Stimulus

House Democratic leadership and Treasury Secretary Steven Mnuchin negotiated H.R. 6201, the second piece of coronavirus relief legislation. On Monday, the House rushed to pass technical changes through unanimous consent but were initially stymied by Rep. Louie Gohmert. After Rep. Gohmert announced he would support the bill, the House passed the updated legislation on Monday evening. But “technical corrections” is a misnomer.

The revised bill is inarguably worse than the original. The bill now gives businesses large subsidies for bearing the costs of paid sick and medical leave. The revised bill’s changes include:

  • Paid family leave would only be available for workers whose children’s daycares or schools are closed due to the coronavirus
  • Paid family leave is limited to 12 weeks and capped at $200 per day and $10,000 total
  • Employers can use the bill’s new paid leave tax credits to offset the costs of employee medical insurance
  • Employees who are eligible for 10 days of paid sick leave under the bill are eligible for 10 days maximum, not in addition to any paid sick days they had before

Now that the bill’s passage in the Senate is assured, it will make its way to Trump’s desk. Fights over the next package have begun in earnest — we will cover developments in our Friday update. 

Bitter Battle Brewing over Corona III

Senate Minority Leader Schumer introduced a $750 billion package to increase hospital capacity, provide emergency child care, and impart loan relief to those most affected by the economic downturn. Speaker Pelosi announced Monday that the House would be in recess until March 23, delaying a third coronavirus package until then at the earliest. 

The coronavirus supplement, H.R. 6201, addresses some of the medical and economic hardships already faced by Americans. But many of the most vulnerable people are still out in the cold.

  • Workers at Large Companies

H.R. 6201’s paid sick leave provision only applies to workers at companies with more than 15 employees but fewer than 500 employees. Per Public Citizen, major companies like McDonald’s, Walmart, and Kroger do not ensure paid sick leave for their employees, leaving millions of workers at extremely profitable companies without coverage.

More than half of all workers work at companies with more than 500 employees. Companies with fewer than 50 employees will be able to apply for a waiver, dampening the benefits of such a provision even further. With these exemptions, the mandate only covers 20 percent of workers. 

Speaker Pelosi defended this choice by arguing that many large companies already provide some form of paid sick leave for their workers. The revised bill, however, prevents companies that already provide some form of paid sick leave from receiving government compensation. With this adjustment, there’s no reason for Congress not to extend the paid sick leave requirements to large companies, as the draft bill had.

  • Gig Workers 

Roughly 25 percent of American workers participate in the gig economy, and for about half, gig work is their primary source of income. What workers gain in mobility, they sacrifice in economic security. Gig workers are rarely eligible for workplace benefits like paid sick leave and are ineligible for state unemployment insurance programs. 

In the face of ongoing coronavirus concerns, gig workers will find themselves in dire straits. While the use of temporary, direct transfers of cash may help mitigate some of the short-term economic pressures on low- and middle-income families, Congress should use the opportunity to create a better, long-term safety net for gig workers.

  • Rural America

Thanks to the Affordable Care Act, more rural Americans have health insurance than ever before. But having insurance doesn’t matter if you can’t access medical facilities or receive care from specialists. Recruiting doctors to rural communities has always presented challenges (they can make much more money as specialists in metropolitan areas), but health system consolidation has accelerated in recent years. Since 2010, 125 rural hospitals have closed, and the National Rural Health Association estimates that rural areas are now short about 45,000 doctors, leaving 85 percent of rural counties with insufficient medical care.

  • The Indentured Postgraduate

With $1.5 trillion in outstanding debt, student loans are the second largest category of household debt, behind only mortgage loans. About 70 percent of students leave college in debt, with the average graduate owing slightly over $37,000. Last Friday, President Trump announced that he was waiving interest on all student loans. The Department of Education quickly clarified, announcing that monthly loan payments will not decrease, and instead, the entire payment will be applied to outstanding principal. 

This will save borrowers some money over the life of the loan, but it brings no short-term relief. For those who remain employed, the impact of the administration’s decision is negligible. For those whose incomes have fallen – or will fall in the near future as labor markets contract – Trump’s proposal accomplishes nothing in the way of providing relief. 

Just Ahead

Gearing up for Corona III, Trump continues to demand that Congress pass a $500 billion payroll tax cut. Today, the Treasury began circulating a sheet of priorities for the next phase. The proposals offer $300 billion in loans to small businesses, $500 billion in direct cash payments to taxpayers, a $50 billion lifeline for the airline industry, and $150 billion for “other severely distressed sectors.” 

The battle looming goes beyond how to provide relief to victims and their often surviving families. The prospect of severe economic dislocation raises the question: if salary and employment agreements in force today were insured during the crisis, offering compensation continuity and job security to workers, can the economic damage be contained?

53 thoughts on “Virus Stops Economy Cold”

  1. I’m really enjoying the design and layout of your website.
    It’s a very easy on the eyes which makes it much
    more enjoyable for me to come here and visit more often. Did
    you hire out a developer to create your theme?
    Exceptional work! 0mniartist asmr

  2. Hey just wanted to give you a brief heads up
    and let you know a few of the images aren’t loading properly.
    I’m not sure why but I think its a linking issue.
    I’ve tried it in two different internet browsers and
    both show the same outcome. 0mniartist asmr

  3. Admiring the persistence you put into your site and in depth information you present.
    It’s awesome to come across a blog every once in a while that isn’t the same out of date rehashed material.
    Wonderful read! I’ve bookmarked your site and I’m including your RSS feeds to my Google account.
    0mniartist asmr

  4. Hi to all, the contents existing at this web page are in fact
    awesome for people knowledge, well, keep up the good work fellows.
    asmr 0mniartist

  5. Do you have a spam problem on this blog; I also am a blogger, and I was wanting to
    know your situation; we have created some nice procedures and
    we are looking to trade methods with other folks, please shoot me an email if interested.

  6. Pretty section of content. I just stumbled upon your website and in accession capital
    to assert that I get in fact enjoyed account your blog posts.
    Anyway I will be subscribing to your augment and even I achievement
    you access consistently rapidly.

    Feel free to surf to my web blog club suncity agent [Isabell]

  7. Just desire to say your article is as astonishing. The clarity
    on your submit is simply spectacular and that i can assume you are a
    professional in this subject. Fine together with your permission let me to grasp your RSS feed to stay updated with impending post.

    Thank you 1,000,000 and please continue the rewarding work.

    my web blog – aaa1188 test id

  8. Its such as you read my mind! You seem to understand so much about this, such as you
    wrote the book in it or something. I think that you simply can do with a few p.c.

    to drive the message home a bit, but instead of that, that is great blog.
    A great read. I’ll certainly be back.

    Have a look at my web page; wukong333 download pc

  9. Write more, thats all I have to say. Literally, it seems as though you relied on the
    video to make your point. You clearly know what youre talking about, why throw away your intelligence on just posting videos to your site when you could be giving us something informative to
    read?

    Here is my blog … i 918Kiss Plus

  10. I enjoy you because of your whole efforts on this site. My mum delights in managing research
    and it’s really simple to grasp why. Many of us hear
    all relating to the dynamic medium you produce rewarding techniques on the
    web site and encourage participation from other individuals about this situation then our princess is
    truly discovering a lot of things. Take advantage of the rest
    of the new year. Your conducting a really
    good job.[X-N-E-W-L-I-N-S-P-I-N-X]I am really inspired together with your writing
    talents and also with the format on your weblog.
    Is that this a paid topic or did you customize it your self?
    Anyway stay up the nice quality writing, it is rare to look a nice weblog like this one
    today.

    Review my website Sidney

  11. Have you ever thought about adding a little bit more than just your articles?
    I mean, what you say is valuable and everything. Nevertheless
    just imagine if you added some great images or video clips to give your posts more, “pop”!
    Your content is excellent but with pics and videos, this website could certainly be one of the best in its niche.
    Very good blog!

  12. I’ve been browsing on-line greater than 3 hours nowadays,
    but I by no means discovered any attention-grabbing article like yours.

    It’s pretty value enough for me. In my view, if all website owners and
    bloggers made just right content as you did, the internet might be a lot more
    useful than ever before.

  13. Today, I went to the beach with my children. I found a sea shell and
    gave it to my 4 year old daughter and said “You can hear the ocean if you put this to your ear.” She put the shell
    to her ear and screamed. There was a hermit crab
    inside and it pinched her ear. She never wants to go back!
    LoL I know this is completely off topic but I had to tell someone!

  14. Hello, i feel that i noticed you visited my weblog thus i came to
    go back the desire?.I am trying to find things to improve my
    web site!I suppose its adequate to use some of your ideas!!

  15. You’re so cool! I don’t believe I’ve truly read anything like this before.
    So nice to discover another person with
    original thoughts on this topic. Seriously.. thank you for starting this up.
    This site is something that’s needed on the internet, someone with a little originality!

  16. Very nice post. I simply stumbled upon your blog and wanted to
    say that I’ve truly enjoyed browsing your weblog
    posts. After all I’ll be subscribing on your rss feed and I
    am hoping you write again soon!

  17. We’re a gaggle of volunteers and starting a new scheme in our community.

    Your site offered us with helpful information to work on. You’ve done a formidable task and our whole group will likely be grateful to
    you.

  18. scoliosis
    Greetings from Carolina! I’m bored to death at
    work so I decided to browse your site on my iphone during lunch break.
    I enjoy the information you present here and can’t wait to take a
    look when I get home. I’m amazed at how fast your blog loaded on my phone ..

    I’m not even using WIFI, just 3G .. Anyways, great blog!
    scoliosis

  19. scoliosis
    whoah this weblog is excellent i like studying your articles.
    Keep up the good work! You know, many individuals are looking
    round for this info, you could help them greatly. scoliosis

  20. Having read this I believed it was extremely enlightening.
    I appreciate you taking the time and energy to put
    this content together. I once again find myself personally spending
    a lot of time both reading and posting comments.
    But so what, it was still worthwhile!

    Review my homepage: pussy888 apk download

  21. You really make it appear really easy along with your presentation but I
    find this topic to be actually something which I feel I would
    by no means understand. It kind of feels too complex
    and very broad for me. I am having a look forward for your
    next publish, I’ll attempt to get the hang of it!

    Check out my page; playboy2 website (mega888-app.com)

  22. An impressive share! I have just forwarded this onto a colleague
    who has been conducting a little homework on this. And he
    actually ordered me breakfast because I found it for him…
    lol. So allow me to reword this…. Thanks for the meal!!
    But yeah, thanx for spending the time to discuss
    this topic here on your site.

    Also visit my website: lionking888 game

  23. scoliosis
    Hello, Neat post. There is an issue along with your site in web explorer, may test this?
    IE still is the marketplace leader and a good section of folks will omit your
    fantastic writing because of this problem.
    scoliosis

  24. You really make it seem so easy with your presentation but
    I find this matter to be really something that I think I would never understand.
    It seems too complicated and very broad for me. I’m looking
    forward for your next post, I’ll try to get the hang of it!

    my site … download 3Win8, mega888-app.com,

  25. I have been browsing on-line greater than 3 hours
    nowadays, yet I by no means found any fascinating article like yours.
    It’s pretty worth sufficient for me. Personally, if all site owners
    and bloggers made excellent content material as
    you probably did, the net will probably be a lot more helpful than ever before.

  26. My spouse and I stumbled over here from a different web address and thought I
    may as well check things out. I like what I
    see so now i’m following you. Look forward to going over your web page repeatedly.

  27. you’re actually a good webmaster. The web site loading speed
    is incredible. It kind of feels that you are doing any unique
    trick. Also, The contents are masterpiece. you’ve done a wonderful task on this topic!

  28. May I simply just say what a relief to uncover a person that really knows what they
    are talking about on the net. You definitely understand how
    to bring a problem to light and make it important.
    More and more people really need to read this and understand this side of the story.

    I can’t believe you’re not more popular because you most certainly have the gift.

  29. Good day! This is kind of off topic but I need some help from an established blog.
    Is it tough to set up your own blog? I’m not very techincal but I can figure things out pretty quick.
    I’m thinking about setting up my own but I’m not sure
    where to begin. Do you have any points or suggestions?
    Cheers

  30. It’s perfect time to make a few plans for the future and it’s time to be happy.

    I’ve learn this post and if I could I want to suggest you few attention-grabbing issues or tips.
    Perhaps you can write subsequent articles relating to this article.
    I wish to read more issues approximately it!

  31. Hi i am kavin, its my first time to commenting anywhere, when i read this post i thought i could also make
    comment due to this good article.

Leave a Comment

Your email address will not be published. Required fields are marked *