July 19, 2024


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How the stimulus got done

How the stimulus got done

Problem Solvers Caucus members speak about the expected passage of the emergency COVID-19 relief bill, Monday, Dec. 21, 2020, on Capitol Hill in Washington.

Problem Solvers Caucus members speak about the expected passage of the emergency COVID-19 relief bill, Monday, Dec. 21, 2020, on Capitol Hill in Washington. | AP Photo/Jacquelyn Martin

When the top four congressional leaders finally sat down after months of avoiding a meeting on coronavirus relief, things quickly grew heated. Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer thought they were being lowballed.

Two days before, a bipartisan Senate group looking to break the logjam split their $908 billion proposal into two pieces: $160 billion in state and local aid along with a liability shield, and a $748 billion spending bill without those two most contentious issues.

House Minority Leader Kevin McCarthy, Senate Majority Leader Mitch McConnell and Treasury Secretary Steven Mnuchin told the Democratic leaders they believed the starting point for negotiations should be $748 billion, since many Democrats, including the Senate minority whip, had embraced that figure.

The pushback was immediate.

“They misrepresented the Democrats in the Gang of Eight and said they’re for $748 billion. I said, ‘No, they’re not.’ They told me they’re for $908,” Schumer said in an interview on Monday.

After so many months of inaction even as the virus raged, Washington’s top leaders had no spending target in common when they convened. McConnell had proposed several bills ranging from $500 billion to nearly $1 trillion, Pelosi and Schumer wanted $2 trillion or more and Mnuchin and Pelosi had talked about $1.8 trillion. Schumer said the ensuing discussions over total spending consumed a day and a half.

After congressional leaders eventually signed off on a coronavirus relief deal totaling around $900 billion, McConnell argued he’d been right all along.

“The fundamental point is that $900 billion is considerably less than $3.4 trillion,” McConnell said Monday. “It’s within the range of what I recommended back in July.”

But McConnell didn’t tell the whole story. Democrats also landed their own victories, including more than $28 billion in worker tax credits and international vaccine funds championed by Pelosi.

During that pivotal meeting last Tuesday, Schumer, Pelosi and McCarthy did most of the talking as discussions began, but McConnell offered an insight: The unemployment boost that Democrats wanted was riling up conservatives.

“What drives my guys crazy is that people on UI make more than they would if they worked,” McConnell told negotiators, as he displayed a Department of Labor table showing that the $300 weekly bonus made more than 50 percent of people less likely to work.

“The plural of anecdote is not data,” Pelosi retorted. “I don’t care what Mr. Scalia says,” she added, referring to Labor Secretary Eugene Scalia.

That tense exchange demonstrates why congressional leaders faced a bottom-up revolt from the rank-and-file, which was sick of the finger pointing and paralysis in the face of crisis. But it also showed why a renegade group of lawmakers can only go so far before they need party leaders to finish the job.

There’s been an enormous rush on all sides to take credit for the final product, but everyone compromised. The give-and-take in the second-largest stimulus deal ever was real, according to interviews with more than a dozen lawmakers and aides.

The bipartisan, bicameral group handed off their proposal to party leaders and saw some language ignored or altered. Democrats settled for a smaller bill with no money for state and local governments and no promise of another aid package soon.

Republicans spent more than they wanted, and McConnell dropped his “red line” of liability protections. President Donald Trump and the odd couple of Sens. Josh Hawley (R-Mo.) and Bernie Sanders (I-Vt.) got their stimulus checks, but with smaller sums than they had requested.

Now the question on everybody’s mind is: What took so long?

‘It’s juvenile, it’s destructive’

The passage of the latest relief bill marks nearly eight months to the day since Congress last provided coronavirus aid to a country besieged by the pandemic. On April 23, Congress passed its fourth aid package, bringing the total sum to roughly $3 trillion.

After that, the congressional response to the coronavirus amounted to starts and stops, stalled negotiations, the rare frosty conversation between party leaders and endless bickering — before last week’s flurry of activity. During the stalemate 17,000,000 more Americans were diagnosed with the coronavirus and more than 260,000 died. To date, nearly 310,000 Americans have died from the virus. On top of the public health crisis, millions remain unemployed.

And though Congress ultimately passed the agreement overwhelmingly, by 359-53 in the House and 92-6 in the Senate, party leaders are spending nearly as much time blaming each other for what’s not in the bill as they are detailing what economic and medical relief will finally be coming.

“It’s juvenile, it’s destructive, it’s disappointing and to me it’s as unpatriotic as anything I’ve seen in Congress,” said Rep. Dean Phillips (D-Minn.), a member of the bicameral, bipartisan working group. “At a time when we need to be finding ways to build bridges, the continued destruction of them is appalling.”

Yet after so many failures of Senate gangs and thwarted rank-and-file rebellions, the centrists finally found success. The ultimate deal was cut in the leadership suites, but started out as a ragtag band of senators holding informal dinners, texting furiously and working with barely any staff.

The Senate runoffs in Georgia also invited a deal. McConnell had promised GOP Sens. David Perdue and Kelly Loeffler weeks ago that the Senate would not leave for Christmas without a new law. And Democrats want to lock in some relief ahead of the new Biden administration in case they fail to win back the Senate.

It also didn’t hurt that Trump largely withdrew from the talks as he contested his election loss. Trump spoke to Hawley frequently and Mnuchin represented his position, but his Twitter feed was more focused on conspiracy theories about Nov. 3 than on the contours of the 5,000-plus page bill that Congress produced.

“I’m counting down the hours ‘til he’s gone,” Pelosi told her leadership team as they strategized this weekend. “I plan to pull him out of there by his hair, his little hands and his feet.”

The relationship between the four congressional leaders isn’t much better. Even after they announced a deal, bitter recriminations have continued to fly from both ends of the Capitol. That does not bode well for bold, bipartisan deals next Congress, especially with razor-thin majorities and lingering mistrust among leaders.

Perhaps President-elect Joe Biden can change things. After all, McConnell credits Biden with helping to break the deadlock by calling for immediate coronavirus relief not long after he was elected.

For centrist lawmakers, one silver lining of the monthslong leadership stalemate was the opening it provided for real, bipartisan deal-making at the rank-and-file level. It may make them a much more formidable force in the next Congress.

“If the committees are not re-empowered to act the way that they did when I was a relatively new senator?” asked Sen. Susan Collins (R-Maine), a leader of the centrist coalition. “Then I think we will continue to see efforts like this take place.”

Collins worked for six weeks to try and get a bipartisan product on the floor. And there were times when it looked like it might not get there.

Rank-and-file rebellion

First, what became known as the centrist “908 Coalition” only produced a stimulus framework. But eventually they drafted hundreds of pages of bill text. When they finally released it, the hard work began.

Last Tuesday, Collins pressed McConnell in a Republican conference call to use their bill as the starting point, particularly since it reflected the GOP leader’s suggestion to drop contentious state and local funding and a liability shield. Collins explained how hard the group worked on the legislation and that it should underpin the new law. McConnell was noncommittal, vowing only to have his staff examine the text. He later praised the group as “helpful.”

That moment was the culmination of negotiations that started just three hours after Collins went to bed on election night. At 7:35 a.m. the next morning, Collins received a call from Sen. Joe Manchin (D-W.Va.). After a quick congratulations, the conversation quickly turned to coronavirus relief.

“Something had to be done,” Manchin said later in an interview. “Nothing was happening at all.”

Nearly two weeks after Manchin and Collins spoke on the phone, a group of eight senators convened at Sen. Lisa Murkowski’s home for dinner. Since it’s a pandemic, they opened up the windows, wore masks and spread out chairs in the Alaska Republican’s living room as they discussed total spending numbers for the package — a key dispute for months.

Sen. Mark Warner (D-Va.) brought food — upscale Italian takeout — and wine as he tried to triangulate between Mnuchin and Pelosi’s number, thinking he could get Republicans to settle for something north of $1 trillion. He found no takers on the Republican side: Collins and Sen. Mitt Romney (R-Utah) argued $900 billion was as high as Republicans would go. Senate Minority Whip Dick Durbin (D-Ill.) concluded that they could sell the deal as an emergency package.

What then followed was a series of back-and-forth discussions in the “908 Coalition.” Just before Thanksgiving, the senators reached out to members of the House Problem Solvers Caucus about working together.

A half-dozen members in the Problem Solvers, including Phillips and co-chairs Josh Gottheimer (D-N.J.) and Tom Reed (R-N.Y.), tried earlier in the fall to pressure leadership with their own $1.5 trillion bipartisan plan.

That effort didn’t succeed. But the caucus had its own framework to bring to the table when they began joint conversations with the senators via calls and Zoom meetings held during the Thanksgiving break. As those efforts merged, members pointedly refused to call themselves a gang, which in recent years became a moniker denoting failure in the Senate.

The coalition eventually grew to more than 10 senators, after Sens. Maggie Hassan (D-N.H.), Angus King (I-Maine) and Rob Portman (R-Ohio) joined. Romney and other Republicans had met privately with McConnell to explain their proposal, and McConnell did not discourage or encourage the centrist group’s talks, Romney said.

Portman, who attends McConnell’s leadership meetings, stayed in touch with McConnell’s staff. He said he was seeking input, not permission.

“I was trying to be sure that we ended with a product that was going to be useful,” Portman said. “We needed to know how far we could go.”

Over the next few weeks, the senators texted hundreds of times and spoke via Zoom frequently. Some members expressed frustration that party leaders did not mention their work in floor speeches announcing a final coronavirus relief agreement on Sunday night, even though they argue their model could provide a blueprint for negotiations under a Biden administration.

“It’s fair to say that we may give ourselves more credit than we deserve,” Romney said. “But we’re happy to have a sense of having accomplished something significant in a very difficult time.”

Perhaps the one hurdle they had not foreseen was an explosive battle over the Federal Reserve. The dust-up froze negotiations for several days.

“I thought Wednesday night we were finished. This monstrosity reared its head the next morning,” Pelosi recalled.

The Fed fiasco

On Friday morning, staffers told Schumer that Pennsylvania Republican Sen. Pat Toomey‘s effort to limit the central bank from creating similar emergency lending programs to those established in the spring was the primary impediment to a deal. Toomey had long advocated for such language and wanted to make sure the emergency lending facilities were shut down.

Schumer cranked up a messaging campaign by dialing 10 members of his caucus to explain what Republicans were up to and to fight back. Everything stalled out.

After two days of stalemate, Toomey went to the Senate floor on Saturday afternoon to implore Democrats to make him a counteroffer. Watching in his office, Chris Van Hollen picked up the phone.

The Maryland Democrat worked with Toomey on the deficit reduction supercommittee in 2011 and thought he could at least directly engage with him, something no one had done. Toomey did not dismiss him out of hand.

The two senators then gathered on the Senate floor surrounded by colleagues. Van Hollen and Warner filed into the Schumer’s office. Shortly after, they were followed by others including Toomey, Romney and Sen. Tom Cotton (R-Ark.), a Toomey backer.

“It was a wild Saturday,” Warner said. “People went from losing their temper to … who’s going to really say that $900 billion in assistance is going to depend upon something that is significant but esoteric?”

In the end, the discussions revolved around one word: “similar.” Democrats thought Republicans were trying to tie the hands of Biden by hamstringing the Fed’s ability to deal with a crisis; Republicans thought Democrats wanted to use the Fed as an end-run around GOP resistance to money for states and cities.

Toomey had one last discussion with Schumer, and shortly before midnight on Saturday, aides announced the impasse was broken. Instead of “similar,” the legislation would bar the Fed from restarting the “same” facilities. The conservative Toomey said he would vote for the bill.

Finishing touches

Even after Senate negotiators settled the Fed standoff, it took days for the House and Senate to vote.

In the meantime, lawmakers furiously lobbied to ensure their pet projects were included in a $2.3 trillion, 5,593-page coronavirus relief and government funding package.

One issue that increased in urgency was ensuring pandemic-related business loans were tax deductible. When House Republicans found out Sunday morning during a private conference call with Mnuchin that the fix was not going to be included, they were outraged.

Nearly a dozen members, including House Minority Whip Steve Scalise made clear it was unacceptable. Mnuchin went back to the negotiating table, and hours later, word trickled down that the provision made the final cut.

“For many members, it was a deal-breaker,” Scalise (R-La.) said in an interview.

Pelosi, too, was busy closing things out. In a flurry of phone calls with Republican leaders on Sunday — two with McConnell, five with Mnuchin — she secured roughly $38 billion in worker-related tax credits, funding for water infrastructure projects and international vaccine distribution.

And while Congress finally passed a deal after months of delay, Democrats are vowing that this latest agreement will not be the last. McConnell, meanwhile, said he is taking a wait and see approach. But he expects to see another proposal from the Biden administration in the near future — and isn’t planning to give up his push for the liability shield that Democrats detest.

“I have no diminished desire to achieve that,” McConnell said. “I’m going to be taking the same view.”

Melanie Zanona and Sarah Ferris contributed to this report.