Coronavirus USA

Second stimulus check: how much do Republicans want to cut aid with the HEALS Act?

The Republicans' proposal to counter the HEROES Act has been described as "falling far short" by Nancy Pelosi as the two sides prepare to negotiate a deal.

Second stimulus check: how much do Republicans want to cut aid with the HEALS Act?
ERIN SCOTT REUTERS

Senate Majority Leader Mitch McConnell on Monday announced the delivery of the Republicans’ long-awaited new stimulus package, the Health, Economic Assistance, Liability Protection and Schools (HEALS) Act. In line with what Senate Republicans had been touting for some time, HEALS consisted of $1 trillion in funding with another round of stimulus checks for US citizens hard-hit by the coronavirus pandemic and rampant unemployment included in the bill.

The HEALS Act is the Republican response to the Democrat-led proposal passed in the House of Representatives in May, the HEROES Act, which consisted of a $3 trillion package with an emphasis on individual economic aid and a broader spectrum of recipients for stimulus checks and additional financial support for families.

Democrats dismiss HEALS 

However, Senate Republicans put the kibosh on HEROES almost before the ink on the bill was dry. McConnell has been a vocal proponent of belt-tightening in federal spending during the Covid-19 pandemic and felt that the Democrats’ proposal was too expensive. By contrast, the Democrats and some Republicans have said that HEALS is akin to using a sheet of A4 to to bridge the Grand Canyon.

Senate Minority Leader Chuck Schumer said the Republican legislation did "not go far enough", while House Speaker Nancy Pelosi was equally dismissive of the proposal: "What we have seen so far falls very short of the challenge that we face in order to defeat the virus, and in order to open our schools and open our economy. We have to act. And what they’re proposing falls far short.”

Now Americans will have to wait while the two parties go to the negotiating table to hammer out a deal. It has long been suggested that the final cut of the stimulus package will land somewhere between the two proposals at around the $2 trillion mark – in line with what was provided in the CARES Act signed into law in March, which made $2.2 trillion available.

Second stimulus check included in HEALS 

McConnell touted HEALS as a "tailored and targeted" plan to reopen schools and businesses, while protecting companies from lawsuits. Practically the only aspect of HEALS and HEROES that both Democrats and Republicans agree on is a second round of stimulus checks. As with CARES, these will consist of $1,200 for individuals, with mopre supports for families who have adult dependents. The CARES Act only allowed for $500 stimulus checks for dependents under the age of 18.

The same income criteria for the stimulus checks will be in place as was for the CARES Act ($1,200 per adult with adjusted gross income up to $75,000, tapering down to zero above $99,000. For married couples filing jointly the threshold is $150,000 tapering down to $198,000.)

There had been suggestions that the Republicans would seek to include a $40,000 earning threshhold on a further round of stimulus checks but this appears to have been discarded. 

Unemployment benefits a sticking point

One of the main sticking points are unemployment benefits. The $600 weekly payment for those who have lost their jobs due to the pandemic expires on Friday 31 July and the Republicans have long been resistant to extending it. In June, McConnell said the added unemployment benefits were a “mistake” and voiced widely held Republican concerns by suggesting they encouraged Americans to remain out of work.

Under the HEALS Act, the $600 payment would be slashed to $200 and only extended for two months. Then, individual states would be obliged to foot the bill to pay workers up to 70 percent of their pre-pandemic wages.

McConnell: HEALS Act just a starting point

Republican Senate Majority Leader Mitch McConnell (C) prepares to meet with Chief of Staff to US President Donald J. Trump Mark Meadows and Treasury Secretary Steve Mnuchin.

There is no set timescale for the two parties to reach consensus on the latest stimulus package but it is expected that both Republicans and Democrats will push for a bill to be hammered out before 7 August, when the Senate goes into recess for a month.

McConnell acknowledged that the HEALS Act was just a starting point that would need bipartisan support, telling a news conference: "We can't pass a bill in the Senate without Democrats.”