Joe Biden Unveils $1.9 Trillion COVID Stimulus Plan

Biden unveiled his 2-step plan of "rescue and recovery" in a 30-minute presentation, which was just as was leaked in advance: a $1.9 trillion stimulus proposal which will encounter immediate Republican opposition due to its big-ticket spending on Democratic priorities including aid to state and local governments, a hike in the minimum wage to $15, and expanded unemployment benefits.

“We have to act and we have to act now,” Biden said, ahead of laying out a second, even broader economic recovery plan next month at a joint session of Congress. That initiative will include money for longer-term development goals such as infrastructure and climate change, the transition team said. So even more trillions.

As Bloomberg summarized it, "Biden’s speech had the flavor of a shorter and more concise State of the Union address, focused of course on the pandemic and economic recovery. He laid out a number of goals and some plans yet basically set broad goals -- and asked Congress to foot the big price-tag to achieve them."

Biden's bill - which amounts to $400 billion for Covid-19 management, more than $1 trillion in direct relief spending, and $440 billion for communities and businesses - is more than double the $900BN bipartisan bill approved last month, and only slightly below the March 2020 Cares Act. The bigger size, and inclusion of Democratic priorities such as a minimum-wage hike, also means that it will be next to impossible for Republicans to vote for Biden's proposal.

This is a problem because as we explained previously, certain key measures such aid to states and money for health care, will likely need 60 votes in the Senate. On the other hand, jobless benefits, stimulus payments, and the minimum wage hike, could go through with a simple majority under a special budget tool. Amusingly,  progressives are already saying Biden's bill isn’t big enough.

While Biden didn’t mention Trump by name, but he took several swipes at the current administration, especially in terms of the vaccine rollout, which he called a “dismal failure.” That’s tougher language than other officials have been using.

A brief recap of Biden's proposal is below:

  • Direct payments of $1,400, on top of the $600 approved in December
  • $400 per week in supplementary unemployment benefits through September
  • $350 billion for state and local governments
  • Raising the minimum wage to $15 an hour
  • $130 billion to help schools reopen
  • $160 billion in funding for a national program of vaccination, testing, and other coronavirus containment efforts
  • $30 billion for rental and small-landlord support
  • $25 billion for childcare providers
  • Expanded food assistance
  • Expanded child tax credits
  • Expanded medical and family leave
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