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Republicans to cut unemployment benefits to $200 a week

Mitch McConnell unveiled Monday afternoon that Republicans’ $1 trillion coronavirus relief package will cut weekly unemployment benefits from $600 to $200 and include a second round of $1,200 direct checks. 

‘Republicans want to continue a federal supplement to state unemployment insurance,’ the Senate majority leader said.

‘In fact, we’ll propose a weekly dollar amount that is eight times what Democrats put in place when they controlled the White House and Congress in the Great Recession,’ he said of the reduced benefits. 

House Speaker Nancy Pelosi, however, pushed back during an interview with MSNBC following the bill’s unveil.

‘Why are you quibbling over $600 when people need that to buy food, pay rent,’ the California Democrat lamented.

McConnell said from the Senate floor Monday afternoon that U.S. economic recovery has been ‘promising’ so far – claiming there is one foot in the pandemic and one foot in recovery. 

‘American people need more help, they need it to be comprehensive and they need it to be carefully tailored to this crossroad,’ McConnell said during his prepared remarks. ‘Our economic policies have to acknowledge both sides of that coin.’

The proposal to reduce unemployment benefits comes after Treasury Secretary Steven Mnuchin and Donald Trump’s Chief of Staff Mark Meadows announced over the weekend that the White House wants to cap the relief at 70 per cent of initial wages. 

This is intended to be an interim measure until states are able to implement a program where workers would be paid 70 per cent of the income they collected pre-coronavirus.

McConnell also touted a measure that would send a second round of $1,200 relief checks to Americans like was included in the sweeping stimulus package earlier this year. 

‘Chairman Grassley will introduce another round of direct checks for households with the same amount as before, with even more support for Americans who care for vulnerable adult dependents,’ McConnell detailed. 

The Republican bill comes after Mnuchin and Meadows spent the weekend on Capitol Hill negotiating with GOP leaders over the details of the legislation.

The duo initially said this weekend that the 70 per cent wage compensation program would be in the phase four coronavirus relief package. 

The $600 boost in benefits is set to expire in the next few days, meaning if a compromise is not reached, Americans who lost their job during the pandemic could lose thousands of dollars every month.

Democrats, on the other hand, have proposed extending the $600 weekly jobless benefit until January, arguing that the unemployment rate remains unnaturally high due to the health and resulting economic crisis. 

The bill, McConnell revealed Monday, also included bolstered Payment Protection Program funds to prevent layoffs and small businesses from closing.

He also said it would allocate $100 billion to reopen schools as the White House pushes for schools and universities to resume in-person classes in the fall.

‘We’re talking about more than $100 billion more for an education fund than House Democrats put aside in a bill that spent multiple-trillions,’ he said.

If passed, it would also protect employers from facing lawsuits over transmission.

Mnuchin also vowed over the weekend that the second round of direct checks would be administered in August. 

Even with significantly decreasing the weekly unemployment benefits, the latest bill could be dead on arrival as it is still unclear if Republicans will approve another $1 trillion economic stimulus package.

Senator Lindsey Graham said during an interview with Fox News’ Sunday Morning Futures that at least 50 per cent of Republican lawmakers will vote against whatever package leadership unveils.

‘Half the Republicans are going to vote no to any phase four package,’ the South Carolina senator told Fox News host Maria Bartiromo Sunday morning. ‘That’s just a fact.’

‘And a lot of Democrats are going to insist on $3 trillion, which would be way too much,’ he continued. ‘It would be wasted money.’

Graham’s comments, however, came ahead of the latest in a series of meetings between White House officials and Senate Republican leadership at the Capitol Sunday afternoon.

The $200 payment is likely serve as a bridge as states could likely face unknown complications when trying to implement the 70 per cent cap unemployment insurance program.

The lessened payment would be administered on top of whatever unemployment benefits states already pay those who have lost their jobs.

While benefits vary by state, it generally replaces about 45 per cent of a worker’s original wages.

Republicans are looking to incentivize individuals to go back to work, claiming the currently bolstered unemployment benefits are exacerbating unemployment levels by paying many Americans more to sit at home than to go back to their jobs. 

‘I’m confident that President Trump will lead us to a solution where we have money for kids, jobs, and health care. We need to stimulate the economy. We need a phase four. And I think we will come together before August the 5th to get this done,’ Graham said.

His signal that the negotiations could drag out into the first week of next month come as the bolstered unemployment benefits are set to expire within days.

Despite several meetings between administration officials and Republican lawmakers, the White House has not made any further contact with congressional Democrats since Friday – meaning the package presented Monday could be very different from what the opposition party is expecting to see.

‘No discussions with Democratic leaders on the substance of what we’re discussing today,’ Meadows told reporters at the Capitol when asked if he has spoken with them.

Mnuchin and Meadows returned to Capitol Hill Sunday afternoon to continue negotiations over the $1 trillion bill.

The duo claim the package will include a cut back in unemployment benefits from a flat $600 bonus to up to 70 per cent of individuals’ pre-coronavirus wages – they also said it will include a second round of stimulus checks.

Mnuchin says the new stipulations for unemployment insurance is a concerted effort from the GOP to incentivize individuals to go back to work.

‘We’re not going to use taxpayer money to pay people more to stay home,’ Mnuchin told reporters outside the Capitol following a meeting Saturday.

‘I think workers and Americans understand the concept that you shouldn’t be paid more to stay home than to work,’ he reiterated during an interview with Fox News’ Chris Wallace Sunday morning – ahead of another Capitol Hill meeting.

‘The fair thing is to replace wages,’ he continued.

Mnuchin also vowed there will be a second round of $1,200 stimulus checks sent out in August.

The negotiations with Senate Republicans over the specifics of the bill was an effort to gain a solid position before talks with House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer.

Pelosi refused to say Sunday morning whether she would accept a proposal that did not include the boosted unemployment benefits, which are set to expire in a few days.

‘You don’t go into a negotiation with a redline but you do go in with your values,’ the California Democrat told CBS News’ Margaret Brenner during an interview on Face the Nation Sunday.

She also said the $600 figure was agreed upon because it was simple, in contrast to the Republican proposal of 70 per cent of wages, which she said would be much more difficult to figure out and organize.

While speaking to reporters at the Capitol on Saturday, Mnuchin explained: ‘We were in an emergency last time, so we instituted this quickly.’

He also acknowledged that Republicans knew this was a ‘fundamental issue’ when it made it into the previous relief package.

‘In certain cases, people were paid more to stay home than they were to work,’ the Treasury secretary lamented. ‘And I think that’s something the American public understands.’

White House Chief of Staff Mark Meadows said Sunday that the Republican bill will not extend the $600 in unemployment benefits.

‘The original benefits will not [be extended],’ Meadows told ABC News’ This Week host George Stephanapoulos. ‘The original unemployment benefits actually paid people to stay home, and actually a lot of people got more money staying at home than they would going back to work.’ 

Some of Republicans’ biggest complaints about the last sweeping stimulus bill is that it incentivizes people to stay home and collect a check rather than go back into the workforce.

Mnuchin and Meadows detailed that the new legislation would transition to a ‘wage replacement’ unemployment insurance system.

‘We talked about approximately 70 per cent wage replacement,’ Mnuchin said – meaning those who lost their job or are unable to work in the midst of the pandemic would be given up to 70 per cent of their usual earnings. 

Mnuchin detailed that Republicans will roll out the next coronavirus relief package on Monday, also promising that along with the aide will be another round of $1,200 direct checks for Americans in August.

He also assured following meetings with Meadows that the bill has backing from the White House. 

Mnuchin also detailed in an interview with Fox News Sunday host Chris Wallace that the administration swiftly gave up on trying to get in a payroll tax cut because it was clear Democrats would not budge on the issue.

‘Well, in our conversations with Pelosi and Schumer, it was very clear that the Democrats were not going to give us a payroll tax cut,’ Mnuchin told Wallace Sunday morning. ‘So that’s something the president will come back and look at later in the year –’

Wallace cut into Mnuchin’s answer, pushing him on if there was Republican support for the measure Trump has been pushing.

‘There are other Republicans that supported it, and let me just say – again, we know we need bipartisan support. We have tax credits that we put in here to incentivize people to get back to work and small businesses to hire people. We have the direct payments,’ he said.

Mnuchin also assured: ‘As you know, the direct payments are much quicker way of effectively giving everybody a tax cut and it’s much quicker than the payroll tax cut.’

Meadows and Mnuchin met with Republicans and GOP staff on Capitol Hill to salvage the $1 trillion proposal – and the secretary told reporters there one of Trump’s biggest concerns is extending but reducing the expiring unemployment benefits. 

Mnuchin called the $600 weekly aid ‘ridiculous’ and a disincentive for people to go back to work. 

‘We want to move forward quickly. The bill will be introduced Monday and we’re prepared to act quickly,’ Mnuchin said of the bill, adding the president would ‘absolutely’ support the emerging Republican package. 

‘This is all about kids and jobs,’ he continued. ‘This is our focus and we want to make sure something gets passed quickly so that we deal with the unemployment and all the other issues.’

Trump’s push for another coronavirus aide bill comes as he has continued to slip in public polls, especially over his handling of the pandemic.

But the president has denounced the poll numbers as ‘fake,’ assuring he has a high amount of enthusiasm for his reelection in November.

‘The Trump Campaign has more ENTHUSIASM, according to many, than any campaign in the history of our great Country – Even more than 2016,’ Trump tweeted Sunday morning. ‘Biden has NONE!’

‘The Silent Majority will speak on NOVEMBER THIRD!!!’ he touted. ‘Fake Suppression Polls & Fake News will not save the Radical Left.’

Mnuchin’s optimistic assessment of the new legislation came before Democrats weighed in publicly on the updated proposal, which remained only a starting point in negotiations with House and Senate Democratic leaders.

He said he recently called House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer ahead of shuttle negotiations next week on the broader deal.

Since the COVID-19 threat hit the U.S., Mnuchin has acted as the liaison between the White House and Congress, specifically with Democrats. 

But while Mnuchin, who is friendly with Democrats and has donated to them in the past, is making efforts in Congress – Trump continues to bash Pelosi, and other opposition leadership, for their responses to coronavirus.

‘Crazy Nancy Pelosi said I made a mistake when I banned people from infected China from entering the U.S. in January,’ Trump reminded in a tweet Sunday.

‘Tens of thousands of lives were saved, as she danced in the Streets of Chinatown (SF) in late February,’ he continued. ‘Biden agreed with her, but soon admitted that I was right!’

The White House and Senate Republicans are racing to regroup after plans to introduce another $1 trillion rescue bill collapsed Thursday amid GOP infighting over its size, scope and details.

The original bill measures were expected to bring $105 billion to help schools reopen in the fall, new money for testing and benefits for businesses – including a fresh round of loans, tax breaks and a sweeping liability shield from COVID-related lawsuits.

But as Republicans struggled over the details, the White House team downplayed the differences with the GOP senators as overblown and said Trump was focused on providing relief.

‘The president has been very clear. He wants to make sure that the American people have what they need during this unprecedented time,’ Meadows said, ‘to make sure not only the money is there but the programs.’

The expiration of the $600 weekly jobless benefits boost had been propelling the Republicans to act. Democrats already approved their sweeping $3 trillion plan from Pelosi two months ago. But with millions of Americans about to be suddenly cut off from the aid starting Saturday, they were bracing to prevent social and economic fallout.

The White House floated plans to cut the additional aid back to $100 a week, while Senate Republicans preferred $200, with general agreement about phasing out the flat boost in favor of one that ensures no more than 70% of an employee’s previous pay.

Mnuchin also said the $1,200 direct payments would be based on the same formula from the earlier aid bill. Individuals making $75,000 or less, for example, received the full amount and those making more than $75,000 received less than $1,200 depending on their income. Individuals earning above $100,000 did not qualify for the payment.

‘We’ll get the majority of them out in August and those will help people,’ Mnuchin said.

The administration officials said the overall package remained at $1 trillion, apparently on par with Senate Majority Leader Mitch McConnell’s original draft.

Democrats had warned time was running out, saying Republicans were in disarray. 

The jobless benefit officially expires July 31, but due to the way states process unemployment payments, the cutoff was effectively Saturday. Other aid, including a federal eviction moratorium on millions of rental units, also expires at month’s end.

The GOP plan was not expected to come to a vote but serve as a counter-offer to Democrats. That strategy enabled McConnell, who did not have full support from his GOP majority, to avoid having to endure a failed outcome. But it also gave Democrats some leverage in insisting on their priorities as part of any final deal.

McConnell, who spent time over the weekend in his home state of the Kentucky, said Friday he hoped a package could be agreed on ‘in the next few weeks.’

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