‘Go Big’ on Coronavirus Stimulus, Trump Says, Pitching Checks for Americans
The aggressive series of actions came on a day when much of the country seemed to grind to a halt, with daily rituals like commuting and dining out replaced by hunkering down at home. The death toll from the novel coronavirus rose to 100 in the United States, with 5,600 cases confirmed and, with the first case reported in West Virginia, the disease present in all 50 states.
In New York City, Mayor Bill de Blasio warned residents to prepare for the possibility of a “shelter in place” order within the next 48 hours. Officials in North Carolina’s Outer Banks set up checkpoints to turn away visitors. Beach groups of more than 10 were banned in Florida after photographs showed packed Gulf Coast beaches this week during spring break.
To help ease the growing strain of the virus on the United States’ medical system, the Pentagon said it was making available 2,000 ventilators for hospitals, a number that would most likely fall far short of the expected need.
Urgent measures that until recently would have been unthinkable are also being put in place around the world. In the European Union, leaders voted on Tuesday to close off at least 26 countries to nearly all visitors from the rest of the world for at least 30 days
After the briefing at the White House by Mr. Trump and his coronavirus task force, Mr. Mnuchin went to Capitol Hill where he told Republican senators at their weekly lunch that the Trump administration wanted Congress to infuse about $1 trillion in additional stimulus to prop up the economy. While Mr. Trump had signaled that he wanted the payroll tax to be the centerpiece of that effort, it faced bipartisan opposition in Congress, and Mr. Mnuchin said time was of the essence.
“This is a very unique situation in this economy,” Mr. Mnuchin said after the meeting, where he faced questions from more than a dozen individual senators. “We have put a proposal on the table that would inject a trillion into the economy.”
The Treasury secretary declined to share details of his proposal, including a dollar figure for the direct payments to Americans, but said the administration would work with Congress to ensure that a combination of loans, direct checks and other support for businesses and workers can be put in place quickly.
“It is a big number,” Mr. Mnuchin told reporters on Capitol Hill, describing the checks that would be delivered to households across the country. Earlier at the White House, he said the proposal would be targeted so it would not go to the highest earners, such as those making $1 million or more.
The administration has been negotiating with lawmakers in the House and Senate over the timeline and contents of a stimulus package. Republicans had been reluctant to embrace a narrower relief package the House passed early Saturday that includes paid leave, unemployment insurance, free coronavirus testing and additional food and health care aid, which Mr. Mnuchin and Speaker Nancy Pelosi have characterized as a first step to provide relief ahead of a broader stimulus plan to stabilize the economy.
But on Tuesday, as anxiety mounted over how long Congress would be able to stay in session amid the crisis, Senator Mitch McConnell, Republican of Kentucky and the majority leader, said the Senate would in fact try to pass the House bill first then move onto another economic package of “much larger proportions.”
Urging the usually deliberative chamber to move at “warp speed for the Senate,” Mr. McConnell said he had doled out blunt advice to colleagues unhappy with the House-passed measure: “My counsel to them is to gag and vote for it anyway.”
“What I can tell you is we are not leaving town until we have constructed and passed another bill,” Mr. McConnell said.
Among the proposals under discussion was an airline assistance package being helmed by Senators Richard C. Shelby of Alabama, John Thune of South Dakota and Roger Wicker of Mississippi, according a Senate Republican aide unauthorized to disclose details of the discussions publicly. Senator Charles E. Grassley of Iowa, the Finance Committee chairman, is leading a task force on how to best support individuals and businesses.
The White House’s abrupt shift to embrace direct payments to individuals was a clear reaction to sentiment in the Senate, where Republicans and Democrats alike have raced to propose direct payments — and shown little enthusiasm for the payroll tax holiday that was previously the centerpiece of Mr. Trump’s stimulus proposal.
Mr. Thune, the second-ranking Senate Republican, said his conference was largely supportive of the move.
“We have a high level of interest in that idea,” he said. “You are not going to find unanimous consensus on any of these ideas, but I would say that that idea has a lot more resonance with our members than, say a payroll tax cut.”
Mr. Trump said on Tuesday that additional help could be in store for Boeing, the aviation company that already faced serious problems after the grounding of its 737 Max airplanes amid technical problems that led to two crashes.
Widespread travel restrictions are throttling both industries and are expected to be a major drag on global economic growth. Economists at Capital Economics predicted that tourism worldwide could drop 50 percent over the next six weeks, sapping seven-tenths of a percentage point from the world’s annual gross domestic product.
The White House proposal emerged amid a growing sense of urgency among lawmakers to step in with aggressive measures to stanch the economic pain and mounting worry that Congress was running out of time to do so.
With public health officials counseling significant measures to slow the spread of the coronavirus, and states and cities ordering the closing of businesses, limitations on travel and other restrictions on movement, it is not clear how long lawmakers can continue gathering in Washington.
While Mr. Trump’s proposed payroll tax cut had drawn opposition from members of both parties, a growing chorus of Republicans and Democrats had begun calling instead for cash payments to Americans. Senator Mitt Romney, Republican of Utah, said this week that every adult American should receive a $1,000 check from the government.
A group of Democratic senators, led by Michael Bennet of Colorado, Cory Booker of New Jersey and Sherrod Brown of Ohio, proposed sending as much as $4,500 to nearly every adult and child in the United States this year, as part of a sustained government income-support program to counter the economic slowdown.
The idea of a payroll tax cut remains controversial, but it is not entirely off the table. Mr. Trump acknowledged that a payroll tax cut holiday could take time to trickle through the economy and that more immediate relief was necessary. However, he suggested that a more modest payroll tax cut could still be part of a future stimulus package.
Economists on both sides of the aisle have pressured lawmakers to adopt direct payments over payroll tax cuts because they would bolster the economy more quickly and better help workers who lose their jobs or have their hours cut back as economic activity contracts from social-distancing measures meant to slow the spread of the virus.
Conservative proponents of those proposals have included N. Gregory Mankiw of Harvard, a former adviser to President George W. Bush, and Michael R. Strain of the American Enterprise Institute. Liberal proponents include Jason Furman, a former adviser to President Barack Obama, and Claudia Sahm of the Washington Center for Equitable Growth.
“Economic events, public health events, have lit a fire under policymakers,” Ms. Sahm said. “This is the policy we need to have. We should have had it three weeks ago, but it’s good to see it moving.”
The Senate has yet to act on the measure the House passed last week, which was the product of negotiations between Democrats and Mr. Mnuchin. The House substantially scaled back the scope of the paid leave provisions on Monday as part of an agreed-upon package that passed quietly without a formal vote in the chamber.
Workers affected by the pandemic — because they are ill, quarantined, caring for a family member or lack child care with schools closed — would still receive two weeks of sick leave. But health care providers or emergency responders could be excluded by the labor secretary. And any additional leave provided would be limited to workers with children whose schools or child care have been closed.
The original legislation offered 10 additional weeks of paid leave at two-thirds pay for all workers affected by the pandemic.
Ms. Pelosi, backed by new legislative proposals issued by Democrats, said that she and her lieutenants planned to return to the issue, saying in a statement that her caucus “working to advance additional steps to expand the emergency leave mandate.”
The White House and Treasury Department are also considering an array of other proposals to help individuals and small and midsize businesses, which are facing cash flow problems. One of those ideas, according to people familiar with the discussions, would make it easier for businesses to restructure debt. Other ideas under consideration include providing more funding to hospitals and measures such as loan workouts to help homeowners avoid foreclosure.
Jim Tankersley contributed reporting.
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