We celebrate the passage of a roughly $900 billion coronavirus stimulus package combined with a $1.4 trillion spending package to fund government programs through fiscal year 2021. There is no doubt that this will benefit all our clients and the country as a whole. Let’s take a closer look at the agreement in three ways – (1) what does it represent, (2) what does it do, and (3) what could it mean?
In spite of this deal coming at the last possible moment and requiring three temporary funding resolutions to avert a partial government shutdown, it does represent a bipartisan breakthrough and the second largest stimulus package in history. The coronavirus stimulus provides a substantial infusion of aid. At the same time, however, it comes awfully late and offers only short-term relief. Clearly, the need is still so much greater.
As the negative impacts of the pandemic are so extensive, allow me to focus just on one aspect in greater detail.
Before the coronavirus pandemic, more than 35 million people struggled with hunger in the United States, including more than 10 million children, according to Feeding America. In 2020, we are looking at more than 54 million people, including 17 million children who could experience food insecurity. Feeding America has seen a 60 percent increase in food assistance needs since March. About 40 percent of these people have never had to rely on charitable food assistance before now.
Returning to the gap between what was passed and current needs, the incoming Biden administration will be under immediate pressure to propose more assistance, and then try to work that proposal through Congress. President-elect Joe Biden last week called the emerging deal an “important down payment on what’s going to have to be done at the end of January.” This week Biden laid out four priorities for another stimulus package once he takes office. Measures that he indicated support for include:
Senate Majority Leader McConnell anticipates another relief proposal from Biden, but he has not retreated from his opposition to direct relief to states and localities, nor his insistence that employers be protected from COVID-19-related lawsuits. No matter the result of the two Georgia Senate runoffs on
January 5, the Senate will not be easy for a Biden administration. If one or both seats go to the Republicans, then that slim majority will keep Mitch McConnell as Majority Leader and the stage is potentially set for continued contentiousness and gridlock. If both seats go to the Democrats, then we have a 50-50 split Senate in which Democrats are in formal control but not in power. Senators Schumer and McConnell will have to negotiate an agreement for how the Senate will operate. Yes, Vice President-elect Kamala Harris can break ties once things come to the floor for votes, but legislation must get there first. In a 50-50 split Senate, individual Senators are empowered greatly making it difficult for the party of the president to do everything that they may want to do.
In looking at the House of Representatives, Speaker Pelosi has the smallest majority in 18 years, and indications are she faces a significant challenge to keeping it headed into the midterm elections in 2022. After the poorer than expected 2020 electoral results and the fallout around them, it also looks like the Speaker will have more difficulty in building consensus amongst her members. So, no matter what, the Biden administration will encounter a challenging Congress when it comes to getting things accomplished.
Here is a selective summary of what was included in the final package:
Direct relief for individuals ($286 billion)
Small business support ($325 billion)
Healthcare ($63 billion)
Education, childcare, and broadband ($99 billion)
Housing and nutrition ($51 billion)
Transportation ($45 billion)
Tax ($30 billion)
As mentioned at the beginning, this coronavirus stimulus package represented a bipartisan breakthrough. This is no small accomplishment indeed given how polarized our country is, and how partisan Congress has become. There are no other explanations for why this deal took since May when the Heroes Act was passed in House to get done. Certainly, the needs of the country were not getting any less during this time.
This was the second bipartisan effort. On September 15th, the bipartisan House Problem Solvers Caucus – 25 Democrats and 25 Republicans – unveiled its “March To Common Ground” framework to help break the gridlock on the COVID-19 relief package and encourage negotiators to get back to the table. Unsuccessful then, this time around the Problem Solvers Caucus led by its Co-Chairs – Rep. Josh Gottheimer (D-NJ-05) and Rep. Tom Reed (R-NY-23) worked in tandem with a bipartisan group in the Senate. This group included Senators Bill Cassidy (R-LA), Susan Collins (R-ME), Lisa Murkowski (R-AK), Rob Portman (R-OH), Mitt Romney (R-UT), Angus King (I-ME), Dick Durbin (D-IL), Maggie Hassan (D-NH), Joe Manchin (D-WV), Jeannie Shaheen (D-NH), and Mark Warner (D-VA).
Over the past month, this bipartisan group worked behind the scenes finding common ground, hammering out a framework, building momentum and gaining more support, then managed the drafting of a final legislative package able to pass. This effort shows a path begun by centrists from both parties motivated to reach across the aisle to take action and find a solution. At any time, but especially during a crisis, health or otherwise, the absence of good governance and effective leadership harms everyone. In this instance, with time running out, the focus shifted away from partisanship and more towards compromise and finding a solution to meet the needs of society.
Given the current state of play, and the incoming Biden administration, there is an opportunity to see more of these kinds of successes in Congress albeit on a smaller scale in the beginning perhaps. Congress used to be more bipartisan and more functional even during challenging times.
Take the possible 50-50 split Senate as an historic example. The Senate has only been evenly divided three times in the past: 1881, 1953, and 2000. The parties’ leaders at the time, Republican Trent Lott and Democrat Tom Daschle, agreed to a power-sharing agreement that actually led to a reasonably
productive Senate early in 2001. Lott and Daschle agreed to split each committee roster evenly and divide staff resources in half, while Republicans technically retained the chairmanships and the ability to convene hearings and markups. Lott was given the power to proceed to legislation that had received a tie vote in a committee. To be clear, this Senate differed notably from the intense partisanship we have witnessed over the past decade or so, but it does show that no institutional imperative exists saying we must continue on such a hyper-partisan trajectory.
If McConnell remains the Senate Majority Leader, then a final consideration here favoring a possibly more productive future is that Biden and McConnell have a real relationship from their many years together in the Senate. They have a history of negotiating and getting things accomplished together. Biden and McConnell have also managed to stay friends or maintain a working relationship even in the most difficult of times. In 2015, McConnell was the only Senate Republican to attend the funeral for Biden’s son Beau. During Barack Obama’s presidency, Biden’s propensity for cutting deals with McConnell often aggravated liberals. Just last week, McConnell said he will put all Biden’s nominees on the floor for a vote, while at the same time emphasizing they will not all get confirmed. This suggests much better treatment than then Minority Leader McConnell gave President Obama. So in the end, this relationship could be what determines whether anything gets done or not.
If partisanship, dysfunction, and gridlock continue in Congress, and even if all these things are reduced, a Biden administration is likely to focus a lot on executive and regulatory action. Pertaining to the latter, Biden will look to rebuild the Obama regulatory framework that President Trump has been busy trying to dismantle even during his last days in office. In a number of areas, Biden will look to expand upon the Obama administration too in areas like energy and the environment, encouraging the transition to more renewable energy production and increased environmental justice in rulemaking for example. This shift to a greater focus on executive and regulatory action is nothing new and is a direct result of legislative gridlock.