Congress’ COVID Relief Negotiations: Stimulus Talks Get Into Full Swing

Unemployment benefits will begin to lapse for millions of American In less than a month, putting the pressure squarely on Congress — and Democratic leaders– to usher through a $1.9 trillion Covid relief bill.

The next four weeks will test Democratic unity and require the party’s progressives and moderates to put aside clear philosophical differences over the scope of what is needed for the recovery right now. It will also cement a reality for President Joe Biden: his first major push in Congress isn’t going to be a bipartisan one. Instead, a process is fully underway that will allow Democrats to pass this bill through the Senate with just 51 votes.

Bottom line: Congress is out this week, but the quiet work of pulling together the Democrats’ opening offer at Covid relief continues this week with the House on track to pass their portion of the $1.9 trillion proposal as soon as next week.

In the next few days, the House Budget Committee will put together the final bill based off of the section by sections that committees passed last week. This will ensure Democrats are in a place to be able to get the caucus on board and pass the bill as soon as next week.

The immediate obstacles

House Speaker Nancy Pelosi has a five-vote margin on this bill. This isn’t spring 2020, when the economy was cratering and the uncertainty of the virus was so paralyzing for the country that lawmakers came together in a matter of weeks to pass the largest stimulus bill in history with unity. The scrutiny on this package — even by some Democrats — is more intense. That doesn’t mean that a few Republicans won’t cross the aisle and vote for it, giving Pelosi perhaps more room to move the legislation on the floor, but watch members comments over the next several days while they are home on recess to get a clue for how much a lift this is going to be for the House speaker.

The Senate problem

In the last several weeks, House Democrats haven’t been working in a vacuum as they transformed Biden’s proposal into legislative text. Senate Democratic aides from the Finance Committee have been consulting with House Ways and Means panel. The Senate’s HELP Committee has been working closely with the House Education and Labor panel. Aides have been in close contact and Democratic senators have made it clear — both through private nudging and public comments — what they need in the House bill to make it workable on their side.

Still, House and Senate Democrats aren’t in complete unity right now. The expectation is that changes to the House bill will happen in the Senate, but not in a formal committee mark up like last week in the House. Instead, the current plan for Democrats is to bring their bill — with some potential changes that have been ironed out privately– directly to the Senate floor. That could happen as the week of March 2. But, Democrats in the Senate will have two weeks to pass their bill before unemployment benefits lapse. And, if they pass a different bill than the House, the House will have to pass it again before March 14.

For those counting at home, that is 27 days — less than a month — to figure this out.

In that time, Senate Democrats will need to settle a series of intra-party debates over the scope of this bill, whether they are all willing to spend $1.9 trillion, whether they are willing to raise the minimum wage to $15 an hour, whether they are satisfied with the House’s guardrails on stimulus checks that give individuals making $75,000 and couples making $100,000 the full $1,400 while phasing out the check amount faster for higher earning Americans.

Democrats have largely tried to talk about these issues privately and most are likely to vote for whatever comes to the floor given the expectation that giving Americans additional financial benefits is going to be popular. One Democratic senator told CNN last week, “Look, I am voting for this no matter what.” But the next three weeks could test Democratic unity in a way we haven’t seen for a long time.

The minimum wage fight

When Sen. Bernie Sanders, an independent from Vermont, was up to become the top Democrat on the Senate Budget Committee, no one in leadership necessarily expected Democrats would be controlling a 50-50 Senate where what Democrats want and what they have to do to legislate are potentially in conflict.

The events of January 5 turned the Senate dynamics on their head, and Sanders’ role on the panel now as chairman has inevitably pushed the Senate Democratic caucus further left on some key issues. His staff has been expanded to include old Senate hands with a specialty in navigating arcane Senate rules like reconciliation. Add on top of that the fact that Senate Majority Leader Chuck Schumer is up for reelection in the state of New York next year and cognizant of potential primary challengers (including an energetic House sophomore with a history of unseating powerful members of leadership) and well, the dynamics of who has power in these negotiations look very different than they might have two years ago.

Right now, nothing is encapsulating these dynamics more clearly than the fight over the minimum wage.

The people to watch: Sen. Kyrsten Sinema has made it clear that she will not vote for a Senate Covid relief bill that includes raising the minimum wage to $15 an hour.

“Kyrsten is working to ensure a next relief bill is laser-focused on addressing Arizona’s immediate needs and believes all proposals not related to those immediate needs — like the minimum wage increase — must be excluded from the package,” her spokesman said in a statement to CNN last week.

Without Sinema, the Senate cannot pass the Covid relief bill even using the budget process that allows them to pass it with just 51 votes. Schumer has no margin for error. And Sinema’s threat could imperil the entire bill. Not to mention, she is not the only one who has privately expressed concerns about raising the minimum wage in this proposal. Sen. Joe Manchin, a moderate Democrat from West Virginia, is also opposed to including this. Whether it would imperil his vote is not as clear.

While Schumer has repeatedly said that he’s working closely with Sanders to try to push it through, other members of Democratic leadership are more sober about the dynamic.

Asked what it would take to include the minimum wage, the Majority Whip Dick Durbin, a Democrat from Illinois, told reporters last week “I don’t know what it will take, but I’ve heard serious questions asked by some Democratic members that are going to have to be resolved.”

In other words, right now the issue of raising the minimum wage could seriously endanger this Covid relief proposal. Include it, you lose at least one moderate senator. Leave it behind, you risk losing progressives.

One potential way out of this minimum wage fight

It’s very possible that the issue of raising the minimum wage doesn’t pass muster with the Senate parliamentarian. That could save Democrats the pain of having to make this call for themselves.

In order to move a bill using reconciliation, the Senate parliamentarian reviews each provision with the staff to ensure it meets a set of specific set of criteria. One of those criteria is that it must not just have an incidental impact on the budget. In other words, the proposal cannot do something else, but then just happen to have a budget impact. It’s supposed to only be in the bill if its purpose is to impact the budget. During the fight over repealing and replacing the Affordable Care Act, a lot of provisions over abortion rights language were stripped from the GOP’s bill because the parliamentarian argued they didn’t have a direct budget impact.

But, then again the parliamentarian allowed drilling in ANWR to be included in the GOP’s tax bill in 2017. In other words, we should not be predicting one way or another if the $15 minimum wage would survive. Sanders’ has hired staff specifically to help him navigate this review by the parliamentarian known as the Byrd bath, named after the late Democratic Sen. Robert Byrd of West Virginia, who came up with the rule to stop either side from abusing the reconciliation process and trying to use it to just pass legislation that bypassed a filibuster.

Those talks are already well underway now. But, it is possible that the Senate parliamentarian will be the one to actually pull the plug on the issue, saving Democrats from having to make the call themselves and risk losing votes.