President-elect Joe Biden outlined a new stimulus package in a speech on Thursday evening, calling for $1.9 trillion in new federal spending.
The initial thrust of the bailout will devote $20B to a rapid expansion of the nation’s COVID-19 vaccination program, including the establishment of community vaccination centers nationwide, and $50B for expanded COVID-19 testing.
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“The more people we vaccinate, the faster we do it, the sooner we can save lives and put this pandemic behind us," the president-elect said. "The sooner we can rescue and rebuild the American economy.”
The plan will also include $1,400 stimulus checks for most Americans, which Biden said would be an addendum to the $600 checks sent out in the last stimulus bill. Such a payment would help many households pay rent or mortgages and stimulate retail spending, both of which would indirectly support those hard-hit real estate sectors, Biden said.
The president-elect's plan devotes $25B in rental assistance for low- and moderate-income households whose members have suffered job losses during the pandemic, in addition to the $25B Congress approved last month. It would also provide $5B to renters to pay utility bills.
Biden said that 14 million American households are behind on their rent and that the assistance would help them, but also be a "bridge to economic recovery for countless mom-and-pop landlords."
The current federal eviction moratorium, which will expire at the end of March, would be extended to Sept. 30 under Biden's plan. People with federally guaranteed mortgages could apply for forbearance until Sept. 30 as well.
Biden said that 1 in 7 U.S. households, and 1 in 5 Black and Latino households, don't have enough food to eat. Besides more money for food stamps and related programs, he said that the government would partner with restaurants to make meals for the hungry, which would have the added benefit of putting restaurant employees to work.
The plan calls for the increase of the national minimum wage to $15/hour, which would impact the retail and restaurant industries more than most.
The stimulus package will also include $350B in funding for state, local and territorial governments, which have suffered significant losses in revenue since the beginning of the coronavirus pandemic. It would further extend unemployment insurance provisions, which would also help households pay rent and buy goods.
Part of the proposal would set aside $15B to fund a new grant program for small-business owners, separate from the Paycheck Protection Program, and $35B to make low-interest loans to entrepreneurs.
The previous bill included an additional $300B of PPP loans, increasing the potential size of the loans to three-and-a-half times payroll, a measure aimed at keeping small businesses afloat — and helping pay commercial rents.
Biden also proposed $130B in funding to help schools reopen, including testing for teachers and students, improving ventilation and providing personal protective equipment, The Washington Post reports. Office owners have said reopening schools is a key piece of any commercial real estate recovery.
Biden’s incoming chief economic adviser, Brian Deese, told Reuters Wednesday that the president-elect will push for the stimulus measures first. Later, he will propose recovery measures related to health care, climate change and infrastructure, though he didn't offer specifics. Biden said he plans to introduce that proposal next month.
The fate of the proposal is uncertain. While the president-elect is certain to receive strong Democratic support for the measure, the wafer-thin control of both houses of Congress after Jan. 20 by the Democratic Party doesn't assure passage in the form Biden proposes it, especially in the U.S. Senate. Previously, Republicans have objected to the cost of direct payments to Americans, as well as bailing out state and local governments.
The upcoming Senate impeachment trial of President Donald Trump and the fact that the Senate needs to confirm Biden's Cabinet picks might also slow the process.
Biden stressed the need to pass the stimulus despite objections, characterizing it as an economic and moral imperative. Biden stressed the need to keep front-line workers employed by local governments on the job.
"We simply cannot afford not to do what I'm proposing," Biden said. "We must act now, and we must act decisively."
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