The left is rebelling against the idea of reducing the number of Americans eligible for $1,400 checks in President Biden’s massive coronavirus relief package, saying Democrats can’t be afraid to go big when it comes to pumping taxpayer money into a pandemic-stalled economy.
They also warned that dragging out negotiations can lead only to a watered-down package that could come back to bite the party in the 2022 midterm elections.
Sen. Bernard Sanders, the Vermont independent who has become the face of the Democratic left after running for the party’s presidential nomination in 2016 and 2020, said Sunday that lowering income levels for the latest round of coronavirus relief checks — a belt-tightening move supported by lawmakers in both parties — is bad politics.
“From a political point of view, it is absurd to be telling working-class people, somebody who has a decent union job making $55,000, $60,000, ‘Sorry, you’re not eligible for the program,’” Mr. Sanders said Sunday on CNN’s “State of the Union.” “It makes no sense to me at all, nor do I think it makes sense to the American people.”
Mr. Biden said he is not budging on the maximum $1,400 checks in his $1.9 trillion plan, but he is open to more restrictions on eligibility for relief.
Lawmakers almost universally agree that wealthier Americans don’t need relief checks.
Liberals say reducing the income thresholds on the lower end will leave millions of people out in the cold.
“The people who got the first two checks — a lot of them are really hurting and have bills piling up and tell me they’re trying to pay their car insurance,” said Senate Finance Committee Chairman Ron Wyden, Oregon Democrat. “They’re expecting a third check.”
The direct payments included in multiple rounds of coronavirus relief last year started phasing out for individuals who make more than $75,000 per year and married couples making more than $150,000 per year.
Democrats have been talking about narrowing those limits to $50,000 and $100,000, respectively.
Treasury Secretary Janet Yellen said on “State of the Union” that people earning $60,000 per year are worthy of support.
“The exact details of how it should be targeted are to be determined, but struggling middle-class families need help, too,” Ms. Yellen said.
The left is urging lawmakers to go as big as they can, as fast as they can, and clean up later if they need to.
“Do not let the price tag dictate the intervention. Let the scale of the problem dictate the price tag,” said Amanda Fischer, policy director at the Washington Center for Equitable Growth. “Do not get caught up in undeserving people getting handouts or rewards that are ill-gotten. It will slow you down, and you can always tax it on the back end if someone’s really getting a windfall.”
Rep. Alexandria Ocasio-Cortez, New York Democrat, endorsed the “spend now, tax later” idea. She said it’s “shockingly out of touch” to say someone who makes $50,000 per year is too wealthy to qualify for relief.
“Give too little, and they’re devastated. Give ‘too much,’ and a single mom might save for a rainy day,” Ms. Ocasio-Cortez said in a post on Twitter. “This isn’t hard.”
Sen. Jeff Merkley, Oregon Democrat, said Mr. Biden needs to follow through with the $2,000 checks he promised last month when he was campaigning for the two Georgia Democrats in runoff races for Senate.
“I would advise him, if he were to ask me, that is not the place to compromise,” Mr. Merkley said on The Intercept’s “Deconstructed” podcast. “That if you want to see us lose a Senate race in Georgia in two years, then modify the promise made, break the promise made during the Georgia runoff.”
Mr. Biden said the $1,400 payments, combined with $600 checks in a package that passed in December, fulfill his promise of $2,000.
The president said Friday that he doesn’t people with yearly incomes of $300,000 to get a “windfall.”
“But if you’re a family that’s a two-wage earner, each of the parents — one making 30 grand and one making 40 or 50 — maybe that’s a little more … well yeah, they need the money, and they’re going to get it,” Mr. Biden said.
In past rounds of relief, the amounts of the checks tapered off as income levels increased. The $600 checks were fully phased out for individuals earning more than $87,000 per year and couples earning more than $174,000 per year.
“What’s important to the president is that we don’t lose sight of people in the middle of the income scale who continue to struggle,” said Jared Bernstein, a top economic adviser to Mr. Biden.
White House press secretary Jen Psaki also suggested that the limits are fungible.
She said Mr. Biden believes that a doctor and a nurse who are married, are living in the president’s childhood hometown of Scranton, Pennsylvania, and are earning a combined $120,000 per year should get a check.
“That’s in his plan,” she said. “In the plan presented by Republicans, they would not get a check.”
Senate Republicans offered a $618 billion plan last week that would provide direct payments of up to $1,000 per person. Those payments would start to phase out for individuals making $40,000 per year and couples earning more than $80,000 per year.
Critics of the direct payments have pointed to analyses that show a good chunk of the money would go into savings accounts rather than go toward stimulating the economy.
Neil Bradley, executive vice president and chief policy officer at the U.S. Chamber of Commerce, pointed to a Census Bureau survey indicating that a majority of households with less than $50,000 in annual earnings have lost employment income during the pandemic.
“A majority of household[s] with more than $50,000 in income — including those between $50,000 and $150,000 — have not experienced any loss in earned income,” Mr. Bradley said in a letter to Mr. Biden and members of Congress. “Congress should consider targeting any additional stimulus checks based on income, loss of employment, or similar criteria.”
Liberals fear a repeat of 2009 negotiations, when the White House spent a good deal of time courting congressional Republicans before lawmakers passed a nearly $800 billion stimulus package that liberals deemed insufficient.
“It stemmed the crisis, but the recovery could have been faster and even bigger,” said Mr. Biden, who was vice president at the time.
Liberal activists say there is no way to go too big or too fast right now, given the slow recovery in 2009 and House Democrats’ losses in the 2010 midterms.
“There’s a case to be made that the very slow economic expansion after the last recession led to, in this case, the Democrats being punished electorally,” said Indivar Dutta-Gupta, co-executive director of the Georgetown Center on Poverty and Inequality.
The mantra this time should be “substantial, sustained and structural,” Mr. Dutta-Gupta said.
He was skeptical that Democrats would be able to smooth over any perceived deficiencies in another round of legislation.
“I think that this is it, this is your shot — right now,” he said. “There is not only no guarantee of another chance, I can almost guarantee there won’t be another chance.”
Congressional Democrats powered through a budget resolution Friday that would allow them to pass a bill without any Republican support.
With a 50-50 Senate and a narrow majority in the House, they don’t have any margin for error.
The split Senate chamber gives outsized influence to Sen. Joe Manchin III of West Virginia, the most conservative Democrat in the chamber, who favors a more immediate bipartisan deal on a package of about $1 trillion.
Mr. Manchin said Mr. Biden’s advisers led the president astray by moving forward with a partisan path this early in his term.
“We should have found something that we could have voted on bipartisan first and then gone down this lane when we hit a roadblock,” Mr. Manchin said at an event hosted by the Bipartisan Policy Center. “And they didn’t do that.”