The federal government is throwing a lifeline to Americans as a global pandemic tightens its grip on this nation — a $2 trillion recovery package meant to soften the economic damage sustained in the fight to quell the coronavirus.
The plan, which passed the Senate unanimously and now heads to the House, is unprecedented in size and scope, and rightly so. The fast-spreading coronavirus has upended the American economy. Within weeks we went from the longest recovery in the nation's history to a record 3 million Americans filing for unemployment as businesses, schools and gathering places shuttered.
For the most part, the plan adheres to the principles laid out last week by Neel Kashkari, president of the Federal Reserve Bank in Minneapolis, in a Star Tribune editorial. It will offer one-time direct payments to an estimated 80% of Americans, with an average payout of $1,200. Regrettably, the package was nearly derailed Wednesday when several Republican senators objected to extra unemployment benefits of $600 per week.
That is hardly a munificent amount. For someone suddenly out of work in the Twin Cities, the monthly total unemployment benefit would increase $2,400. Thankfully, a provision that extends unemployment 13 weeks was preserved.
Small businesses can tap loans, many of which can be forgiven if they commit to keeping workers on the payroll. This is imperative for curbing the surge in unemployment claims. The health care system will receive needed funding as it scrambles to handle the pandemic's impact.
Corporations will get help too — a lot of it. That is necessary. Large corporations employ thousands and are pillars of the nation's economy. A strong airline system must be sustained. It is entirely appropriate, however, to attach conditions to that assistance. The watchdog provisions that some fought for in the Senate are needed to guard against giveaways that do little to alleviate the crisis. There should be more rules, but the need for quick passage is the overriding goal right now.
A six-month suspension of student loan debt also makes sense. That will offer at least temporary relief to many who will struggle in a stay-at-home economy just to keep up living expenses.
There is some relief for states as well, although more may well be needed. Minnesota has a good cushion of budget reserves, but the projected $1.5 billion surplus is no doubt gone in the economic contraction. Revenues will take a serious hit just at a time when demand for services will go up. If unemployment claims continue at the current rate, the state may exhaust its unemployment fund in a few months, and would be forced to get loans from the federal government.
There are flaws in this bill, certainly. And as large as it is, it may only be an installment on what is needed to see the U.S. economy and Americans through this viral disaster. The House should follow the Senate's lead and President Donald Trump's urging and immediately pass it in a bipartisan vote. Doing so would send relief to Americans — and the nation's health care system — within weeks.