Citing a recent proposal from the Democrats for a $2.4 trillion federal aid package he accused of being a “bailout” for “poorly run, high crime, Democrat States,” the president put the US into a temporary frenzy. But don’t worry, despite what the original message may have indicated, there is still hope of aid on the horizon. Here’s what you need to know about what could happen and when.
Why Did The Second Federal Aid Package Fall Through?
In March, as the coronavirus swept across the country, shuttering businesses and causing mass unemployment, the US government signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) act, a $3 trillion federal stimulus package that provided support for the country’s nose-diving economy. Included in the package were hundreds of billions of dollars worth of loans for small business owners as part of the Payment Protection Program (PPP), new tax breaks and provisions, as well as unemployment and stimulus payments. However, as the pandemic dragged on, federal money quickly began to dry up, meaning months into the pandemic, many businesses — big and small — were on the brink of implosion.
Recognizing this, negotiations began months ago for a second federal aid package. While everyone in Washington D.C. was on the same page about the necessity of aid, Democrats and Republicans could not agree on what should be in the package. Republicans wanted a less expensive package that would prevent the country from accumulating more debt and originally said they would not pass anything exceeding $1 trillion. Democrats wanted a more expensive stimulus package, insisting that a more expansive proposal was necessary due to the dire circumstances. Unfortunately, while both sides agreed to small compromises, a middle ground could not be met — leading to a weeks-long stalemate with no end in sight.
That’s when Trump pulled the plug.
Will There Be Any Aid For Businesses?
The need for federal aid did not go away, so Trump’s decision was met by a firestorm of criticism from both the Left and the Right. “With lives at stake, we cannot afford to stop negotiations on a relief package,” wrote Rep. John Katko (R-NY), who is a member of the Problem Solver Caucus, a group of bipartisan lawmakers aimed at passing a stimulus bill. Other members of the group asserted in a statement: “Inaction is not an option.”
Following this criticism, Trump in a flurry of tweets outlined several other actions the administration will take to make sure at least some aid is sent out to Americans in need. While a comprehensive bill doesn’t seem possible, in the words of White House Chief of Staff Mark Meadows, the president is still “willing to be engaged” on piecemeal measures for more aid.
Here’s what Trump has indicated for support so far:
- $25 billion in aid for the airline industry
- A standalone bill for the dispersion of $1,200 stimulus checks
Though these suggestions from the president don’t meet many of the Democrats’ requirements, it is viable that both sides — in a moment of desperation — could agree to emergency aid. President Trump appears bullish on his intention to sidestep bureaucratic red tape to dole out aid as quickly as possible and with little time left, the Democrats may just concede. The next few days will be crucial in terms of ironing out what exactly the president will greenlight and how the Democrats will react.
About the Author
Jemima is a journalist who enjoys reporting on business, particularly small business and entrepreneurship.