Home Madrid Economy Trump plans to hand out $500 billion in cash to Americans as coronavirus tank economy

Trump plans to hand out $500 billion in cash to Americans as coronavirus tank economy

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WASHINGTON (AP) — In a sweeping bipartisan count, the Senate on Wednesday sent President Donald Trump a $100 billion-plus invoice to strengthen coronavirus screening tests and warranty paid sick leave for the millions of workers who are victims of it. But lawmakers and the White House had already focused on the administration’s much larger $1 trillion plan to stabilize the economy as the pandemic threatens the financial ruin of individuals and businesses.

Details on Trump’s economic bailout remain scarce — and it’s sure to grow with lawmaker additions — but his centerpiece is to dedicate $500 billion to begin issuing direct payments to Americans early in the year. next month. It would also funnel money to businesses to help keep workers on the payroll as large sectors of the $21 trillion US economy are all but shut down.

In a memorandum, the Treasury Department proposed two injections of liquidity of 250 billion dollars to individuals: a first series of checks issued from April 6, with a second wave in mid-May. The amounts would depend on income and family size.

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The Treasury plan, which requires congressional approval, also recommends $50 billion to stabilize airlines, $150 billion to issue loan guarantees to other struggling sectors and $300 billion for small businesses. companies. The plan appears to anticipate that many of the loans would not be repaid.

Taken together, the administration plan promises half the trillion dollars to families and individuals, with the other half being used to support businesses and keep employees on the payroll.

The direct payments would only go to US citizens and would be “scaled according to income level and family size”. The two payments would be identical, with the second wave starting on May 18.

The Treasury plan provides a foundation that lawmakers can work from in an unprecedented government response and is likely to be expanded to include additional emergency funding for federal agencies.

The price of the next economic package alone promises to exceed the Treasury’s $1 trillion demand, a bailout not seen since the Great Recession. Trump is urging Congress to pass the jaw-dropping stimulus package within days.

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The Senate plans to stay in session until the third coronavirus bill is passed, with weekend sessions possible. But the House will have its own version and for now is not expected to return until Tuesday, and any final compromise measures will likely not reach Trump’s desk until late next week at the earliest.

Economists say the country is likely already in recession and the stock market continued its free fall on Wednesday. The panic is pushing many lawmakers to shed their ideological baggage to tackle a massive corporate crisis that goes beyond the scope of the 2008 financial panic – a weeks-long virtual shutdown of many businesses and unemployment that could reach 20 % according to some estimates.

On Capitol Hill on Wednesday, Senate Majority Leader Mitch McConnell prepared his colleagues for unprecedented steps to deal with the outbreak’s onslaught on the economy.

“I will not adjourn the Senate until we pass a much bolder package,” McConnell said. “We’re not leaving until we deliver.”

But first, the Senate approved over $100 billion Home-past package sick pay, emergency food aid, free testing and more money for Medicaid, putting him back on track for Trump’s signature — despite Republican objections about the potential impact on small businesses grappling with a new mandate to pay for sick leave. The government would reimburse businesses, but business advocacy groups say the plan is not feasible for many small businesses. Yet only eight Republicans voted no.

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“This legislation isn’t perfect, but we can’t let the perfect be the enemy of the good,” said GOP Sen. Todd Young of Indiana.

McConnell is trying to take control of the third coronavirus effort, shifting responsibility to GOP chairs and promising to consult with Senate Democrats later. Senate Democrat Chuck Schumer of New York blasted McConnell’s approach, saying it’s “too heavy-handed, too partisan, and will take far too long, given the urgency and the need for cooperation.”

However, Schumer has spoken with Treasury Secretary Steven Mnuchin and retains considerable influence as the Senate plans to work through the weekend to try to pass the measure.

Wednesday’s Treasury plan includes $300 billion in “small business interruption loans” that would be 100% federally guaranteed to cover six weeks of payrolls during the crisis. These loans would be made through private banks – and canceled in many cases.

“Every penny they borrow and use to keep people employed, they won’t have to pay back,” said Sen. Marco Rubio, R-Fla., lead author of a detailed Senate plan.

The plan would also establish a dedicated $50 billion loan program for airlines at risk, which would be required to continue flying as a condition of obtaining loans. An additional $150 billion would be used to guarantee loans to other business sectors. Details on the loan programs were hazy, but the terms are sure to be heavily subsidized.

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Fresh out of the primary campaign, Sen. Bernie Sanders has floated his own ideas — getting the feds to keep paying employee paychecks and Medicare covering unmet health care needs stemming from the outbreak. .

“The fastest way to deal with the economic crisis is for the federal government to guarantee that all employers will be able to pay their payrolls and keep their workers on the payroll,” Sanders told reporters. “It’s an expensive proposition, but I think it’s the fastest and best way to make sure the workers of this country continue to have a paycheck.”

Overnight, the White House sent lawmakers a separate $46 billion emergency funding request to bolster medical care for military service members and veterans, fund vaccine and drug production, building 13 quarantine centers on the southern border for migrants, making federal buildings more secure and reimbursing Amtrak for $500 million in anticipated lost revenue, among other things.

Trump’s request also reverses cuts to the Centers for Disease Control and the National Institutes of Health that Trump proposed in his February budget for next year and would create a $3 billion fund for unforeseen needs.

Economists doubted the massive economic bailout being crafted would be enough to halt millions of job losses, even in the short term. It aims to help Americans without a paycheck avoid foreclosures and other financial hardship and prevent businesses from sliding into bankruptcy.

The Treasury plan is on par with the $700 billion bank bailout of 2008 or the nearly $800 billion recovery act of 2009. The White House proposal aims to provide a massive tax cut for employees, $50 billion for the airline industry and $250 billion for small businesses. But nothing is set in stone and all the pressure is for the package to keep growing.

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The amount that would be sent in US checks is yet to be decided. The White House said it liked GOP Sen. Mitt Romney’s idea for $1,000 checks, but not necessarily at that amount and not for wealthier people.

Senate Democrats produced their own $750 billion proposal, including $400 billion to bolster hospitals and other emergency operations in response to the global pandemic and $350 billion to bolster the safety net with controls unemployment and other aid to Americans.

For most people, the novel coronavirus only causes mild or moderate symptoms, such as fever and cough. For some, especially older people and people with existing health conditions, it can cause more serious illnesses, including pneumonia.

The vast majority of people are recovering from the new virus. According to the World Health Organization, people with mild illness recover in about two weeks, while those with more severe illness can take three to six weeks to recover.