President Trump is reportedly planning to meet with his senior advisors this week to talk about options for the next coronavirus stimulus bill, which many are hoping will include a second round of checks. The Wall Street Journal cites a senior administration official for the information.
President’s team to discuss next stimulus bill
The meeting comes as the White House prepares to negotiate with Capitol Hill about the next stimulus bill. President Trump’s advisors have reportedly put together a number of proposals aimed at incentivizing people to return to work and go about their usual activities like dining at restaurants and going on vacation. A resumption of normal activities should help restart the struggling economy as soon as possible.
The senior administration official who spoke to the WSJ said the U.S. has gone through the “rescue phase” and is currently in the “transitional reopening phase.” He believes officials want the country to move into a “growth-incentive phase for the future economy.”
The meeting on the next stimulus bill is scheduled for this week, although the timing could change. The person noted that the White House is becoming more focused on the civil unrest that’s sweeping the nation following the death of George Floyd in police custody.
Wait and see
Democrats and Republicans have significantly different approaches to the next stimulus bill. Trump, his advisors and Republicans have been waiting to see how the first three rounds of coronavirus relief have worked. Many are concerned about the skyrocketing federal budget deficit. White House officials reportedly said they aren’t trying to stall to kill the next stimulus bill entirely.
White House aides believe the next stimulus bill won’t be finished until July. It will partially depend on how successful states are at reopening their economies and whether the downturn starts to turn around.
The Trump administration continues to expect a V-shaped recovery that brings a rebound in the economy over the summer, followed by brisk growth into next year. However, many economies have warned that while economic activity will gradually pick up in the coming months, the expect the recovery to be long and slow. The Congressional Budget Office said earlier this week that it could be nearly 10 years before the U.S. economy fully recovers from the pandemic.
What could be in the next stimulus bill?
Since Republicans and Democrats differ widely on what they want to see in the next stimulus bill, the price tag also varies widely. Republicans have said it could be as high as $1 trillion. Senate Majority Leader Mitch McConnell reportedly told Trump he doesn’t want to exceed that level, although Democrats want to spend a lot more than that.
One of the topics that could come up in President Trump’s meeting with advisors this week is unemployment. Lawmakers from both parties passed a provision that added $600 per week in federal unemployment benefits to state aid, resulting in most people receiving more money to stay home from work than what they earned on the job. Democrats want to extend the extra $600, but Republicans oppose it in favor of incentives to get Americans back to work.
The Trump administration is reportedly considering reducing the amount of the extra federal unemployment benefit to between $250 and $300 per week, according to The Wall Street Journal. Another possibility is to set the benefits as a share of workers’ compensation, so they receive more than the 30% to 40% most workers receive in unemployment. However, that option could end up being too complicated for some states to implement.
Trump officials are also discussing other potential provisions for the next stimulus bill, like a payroll tax cut or a tax credit for people who go on vacation in the U.S. within the next three to six months. One priority for the White House economic advisors is incentivizing companies to do business in the U.S. For example, some want to make certain provisions that are set to start phasing out in two years. The provisions enable companies to deduct capital expenditures associated with relocating from China or other countries.
Trump is open to providing some aid to state and local governments that are facing shortfalls due to the pandemic.
The next stimulus bill will also be up for debate in the Senate as lawmakers discuss ways to support Americans as the effects of the pandemic continue to linger.