On Sunday, a group of 10 Republican Senators wrote a letter to President Joe Biden, saying the 10 of them were willing to support $600 billion in coronavirus relief spending, but not the $1.9 trillion that Biden has proposed—in other words, one-third of the amount on offer. Signing the letter were Susan Collins (ME), Lisa Murkowski (AK), Bill Cassidy (LA), Mitt Romney (UT), Rob Portman (OH), Shelley Moore Capito (WV), Todd Young (IN), Jerry Moran (KS), Mike Rounds (SD), and Thom Tillis (NC).
What’s does the package offered by the 10 GOP senators contain? And what is lost when you cut out $1.3 trillion, an amount that is the equivalent of nearly $4,000 per person living in the United States? Some headline differences include the following:
- Relief checks: The Biden plan would provide $1,400 per person, including children, for individuals with incomes below $75,000 (and couples below $150,000). The GOP plan would provide $1,000 per adult, $500 per child for individuals with incomes below $40,000 and couples making $80,000 or less. Effectively, the GOP cuts the amount sent out in relief checks in half, reducing the cost of this line item by (depending on your estimate) $205–245 billion.
- Unemployment insurance: The Biden plan would provide $400 a week in supplemental payments until September 30th. The GOP plan would provide $300 a week until the end of June. This effectively cuts unemployment insurance spending by more than half, trimming another $160-220 billion.
But, of course, these two cuts only trim of $400 billion (or so) of the $1.3 trillion cut. A full comparison—with estimates from the GOP senators drawing on a chart published yesterday by MarketWatch—reveals cuts in far more areas:
| Biden Proposal | GOP Senators’ Proposal | |
| Relief checks |
$425–465 billion |
$220 billion |
| Unemployment insurance |
$290–350 billion |
$132 billion |
| Direct pandemic assistance |
$160 billion |
$160 billion |
| Small business |
$50 billion |
$50 billion |
| Nutrition |
$12 billion |
$12 billion |
| Mental health/domestic violence support |
$5 billion |
$4 billion |
| Aid to schools |
$170 billion |
$20 billion |
| Childcare support |
$40 billion |
$20 billion |
| State and local governments |
$350 billion |
0 |
| Childcare tax credit expansion |
$120–149 billion Sign up for our free newslettersSubscribe to NPQ's newsletters to have our top stories delivered directly to your inbox. By signing up, you agree to our privacy policy and terms of use, and to receive messages from NPQ and our partners. |
0 |
| Paid family/sick leave |
$84 billion |
0 |
| Health insurance subsidies |
$57 billion |
0 |
| Rent, utilities, homelessness support |
$35 billion |
0 |
| Transit |
$20 billion |
0 |
| Tribal governments |
$20 billion |
0 |
| Veterans’ health |
$20 billion |
0 |
| Cybersecurity |
$9 billion |
0 |
| Total |
~$1.9 trillion |
$618 billion |
When NPQ reviewed the Biden plan nearly two weeks ago, we noted that the plan made nods toward three areas of establishing social rights. The $1,400 relief checks are not completely universal, but at least hint toward the concept of a universal basic income. Childcare tax credit provisions, along with an associated proposal to raise the federal minimum wage to $15 an hour by 2025, hint toward the idea of a living wage. And the paid family leave provision would allow the US to become the 180th nation in the world to offer that benefit. The senators’ proposal vitiates the relief checks and contains none of these other provisions.
Perhaps more shocking is the lack of any allocation in the GOP proposal for covering housing issues, even as the nation’s total rent debt continues to climb. (An article in Bloomberg estimated that rent owed now totals over $70 billion, while the measure passed by Congress in December only provided $25 billion to cover this shortfall.) The risk of cascading evictions whenever the federal rent moratorium is lifted remains very high until this gap in funding is covered.
And the biggest missing item, once again, is the exclusion of federal aid to state and local governments (and also tribal governments). As NPQ has noted many times, federal transfers to state and local governments are important for many nonprofits. An analysis conducted early last year for NPQ found, based on 2015 data from the National Center for Charitable Statistics, that nonprofit contracts with state and local governments total $187 billion a year, four times the $44 billion received from private foundations.
But a federal government failure to support state and local governments affects far more than nonprofits. Broadly speaking, current state constitutional provisions and laws in every state but Vermont require “balanced budgets” at the state and local level, even as the federal government can run as much of a deficit as it chooses. And because economic slowdowns increase state and local public service costs and decrease revenues—the result is budget-cutting that offsets federal spending. When states and localities cut costs, that boosts unemployment both directly and indirectly, thereby retarding economic recovery, as indeed happened with the Great Recession, where state cuts effectively served as a hard brake on federal stimulus spending. Moody’s economists estimate that passage of something like the Biden bill could help the country reach full employment a year earlier than would otherwise occur. Another way of putting this: Failure to allocate resources on that scale could delay recovery by a full year, with all of the concomitant health and social costs that long-term unemployment creates.
Once again, the perils of half measures are evident. What is at stake? Ultimately, these policy decisions will affect the many millions of families that human services and many other nonprofits aim to serve.—Steve Dubb
