The Senate gavels back into session now, the day after Chuck Schumer led a Democratic obstruction on a coronavirus relief package. The timing was a concession by Mitch McConnell to Schumer after yesterday’s debacle, in the hope that a deal could get cut before the next attempt to push the shell bill past cloture in order to expedite the eventual agreement on the $2 trillion CARES Act. Negotiations continued overnight and this morning, but thus far no signs of a breakthrough have emerged.
Can Congress actually function in a crisis? That might depend on just how much focus they put on the crisis itself. According to a senior Republican Capitol Hill aide, Nancy Pelosi returned to Washington to add some hobby horses to the bill. Among them were:
- An increase in collective bargaining power for unions
- Heightened fuel emissions standards for airlines
- An expansion of wind and solar tax cuts
What do those have to do with the coronavirus crisis, one might ask. Republicans certainly did, and they’re correct to do so. These have nothing at all to do with the crisis at hand, but everything to do with pandering to Democrats’ special interest groups. The condition on aid to airlines will likely force them to decline the loans, the aide noted, resulting in massive layoffs or at least furloughs.
This, as Guy Benson points out, is not a denial either:
Notice that this is not a denial of what Dems are seeking, according to my source. It’s a “they’re doing it too!” response.
Speaking of which: If Republicans are pushing ancillary stuff…they should stop! This is *not the time.* https://t.co/QeK8RL45oQ
— Guy Benson (@guypbenson) March 23, 2020
That’s not to say that Republicans don’t have a few other questions to answer, either. Democrats took issue with a lack of oversight and transparency on bailout-cash distribution, which certainly sounds like a legitimate concern for a two trillion dollar deluge of cash:
Congressional Democrats have demanded the legislation include guardrails to prevent firms that receive the emergency aid from firing their workers or stripping them of their health care, among other asks by labor groups. They also are balking at giving Treasury Secretary Steven Mnuchin so much authority to determine which firms receive the assistance.
Section 4003 of the legislation accounts for $500 billion for “emergency relief and taxpayer protections.” Of that money, $50 billion would go to passenger airlines, $8 billion to cargo airlines, $17 billion for companies deemed important to national security, and $425 billion for businesses, cities and states. The bill doesn’t give much more information than that in terms of who would qualify for loans and loan guarantees, leaving much of it up to Mnuchin.
Congressional aides in both parties say they will not budge on the issue, although top party leaders huddled in emergency meetings Sunday to resolve this impasse and others, and talks remained fluid. Senate Majority Leader Mitch McConnell (R-Ky.) said the Senate would move to vote Monday on the legislation, calling it “pretty solidly bipartisan” despite Democratic anger over the bailout provisions and others. …
“There’s too much money with no oversight,” Sen. Jon Tester (D-Mont.) told reporters Sunday.
After what happened to the money in the 2009’s $850 billion stimulus package, that’s a big concern. The money needs to be distributed rapidly, which means Congress probably can’t be trusted with it, but they should have robust oversight over whoever does make those decisions. There should be enough rules in place to make sure we’re not funding another Cash for Clunkers or Solyndra, just to name a couple of the many lowlights of Porkulus, or stuffing money into corporations’ pockets just so they can buy back their own stock rather than keeping people employed.
In the early absence of any reason to have confidence in Congress, the Fed tried to keep market psychology from running amok. They rolled out a $300 billion liquidity operation designed to keep businesses running in the short term:
The Federal Reserve on Monday announced aggressive new emergency measures to support the economy and ensure that credit flows to households and businesses as the country faces the prospect of a deep downturn from the coronavirus pandemic.
The central bank is committing to buy as many U.S. government bonds and mortgage-backed securities as needed “to support smooth market functioning.” …
The Fed is launching three emergency lending facilities, including two that will buy corporate debt. The third is a revival of an emergency program the central bank created during the 2008 financial crisis that will lend to banks against collateral that includes bundled student loans, auto loans, credit card loans and small-business loans.
These facilities are designed to support $300 billion in new credit, and the Treasury Department will kick in $30 billion to help cover losses.
The Fed also said it will soon start up a program designed “to support lending to eligible small-and medium sized businesses, complementing efforts” by the Small Business Administration.
Thus far, it doesn’t appear to be enough to keep investors from going negative, but at least they’re not stampeding either:
Wall Street turned briefly positive Monday morning after a new round of emergency action from the Federal Reserve, before sinking into the red at the open.
The Dow Jones Industrial Average opened with a loss of around 350 points, with the S&P 500 down by around 2 percent and the tech-heavy Nasdaq lower by 1.25 percent.
Stocks slid despite “extensive new measures to support the economy” announced by the Federal Reserve. The central bank said Monday it would inject billions more into the financial system, boost credit flow for businesses and consumers, and provide $300 billion in new financing.
We can expect Congress to do the right thing, as usual after exhausting all other possibilities. The final agreement will likely have better controls and transparency, but hopefully dispense with pork and the hobby-horse demands. If Congress can’t meet this crisis responsibly, they can kiss whatever’s left of their credibility good-bye.
Update: I’m guessing this means they haven’t come to an agreement yet …
.@senatemajldr McConnell shredding Dems: I’d like to see Senate Democrats tell NYC doctors and nurses, who are literally overrun as we speak, that they’re filibustering hospital funding and more masks because they want to argue with the airlines over their carbon footprint.. pic.twitter.com/BKc0rIJGKU
— Julio Rosas (@Julio_Rosas11) March 23, 2020
Update: Schumer complained about getting “a Republican-only bill” yesterday, but says “we are very close” to getting an agreement today:
Sen. Chuck Schumer on massive economic stimulus package in response to coronavirus crisis: "We're very close to reaching a deal, very close. And our goal is to reach a deal today." https://t.co/9qDnZ7gBga pic.twitter.com/9X4c6pT9vM
— ABC News Politics (@ABCPolitics) March 23, 2020
Meanwhile, Pelosi has dropped a 1200-page behemoth after complaining about the GOP’s supposedly bloated bill:
Update: Pelosi’s bill is not exactly focused on the crisis:
— Rachel Bovard (@rachelbovard) March 23, 2020
What in the hell …?
Update: Rep. Dan Crenshaw confirms the earlier report from the GOP aide, and minces no words in his contempt over it:
I can confirm this. This is what Democrats torpedoed the rescue package for.
This will go down as one of the most cynical, disgusting, malevolent actions in history. Millions are losing jobs while they play these games. https://t.co/SUCtYxmXGo
— Rep. Dan Crenshaw (@RepDanCrenshaw) March 23, 2020
Update: The GOP picked up a couple of votes this time around, but the cloture vote still failed 49-46. Schumer says he’s still negotiating with the White House and that cloture is premature on the shell bill. If they’re looking for solar-tax credits, they clearly still have not seen the political light on how this will all look in November.