Many Americans are in need of second stimulus checks and a new coronavirus relief package.
As Congress resumes stimulus negotiations, President Trump has called for a “big and focused” stimulus bill now. Meanwhile, several analysts have predicted when lawmakers will pass the next stimulus package.
Stimulus Package Status
Stimulus negotiations have resumed after the presidential election but lawmakers still have not been able to come to an agreement.
This has left Americans with little hope of receiving their second stimulus checks to help them cope with the coronavirus-led economic crisis.
After the election, House Speaker Nancy Pelosi continued to push for her $2.2 trillion revised HEROES Act while the White House has reportedly stepped back from negotiations on a new stimulus package.
Prior to the election, Treasury Secretary Steven Mnuchin discussed stimulus terms with Pelosi almost daily but the two could not come to an agreement. Now, it is up to Senate Majority Leader Mitch McConnell to revive talks with Pelosi.
President Donald Trump, who had promised “a tremendous stimulus package immediately after the election,” has been busy contesting the election results. Nonetheless, he tweeted Saturday:
Congress must now do a covid relief bill. Needs Democrats support. Make it big and focused. Get it done.
Prior to the election, the White House and Pelosi have already agreed that the next stimulus package will include a second round of stimulus checks for Americans.
McConnell acknowledged on Thursday the need for another aid package but continued to reject the Democrat’s $2.2 trillion stimulus proposal.
He has proposed a much smaller package of $500 billion which was blocked by Senate Democrats before the election. McConnell’s bill does not include the $1,200 direct payments to individuals.
Referring to Pelosi and Senate Minority Leader Chuck Schumer, McConnell said: “I gather she and the Democratic leader in the Senate still are looking at something dramatically larger. That’s not a place I think we’re willing to go.”
But I do think there needs to be another package. Hopefully we can get past the impasse we’ve had now for four or five months and get serious about doing something that’s appropriate.
Nonetheless, McConnell insists that the next stimulus package should resemble his $500 billion stimulus proposal, emphasizing that the bill needs to be “highly targeted at what the residual problems are.”
Meanwhile, Joe Biden also discussed stimulus relief aid with Pelosi and Schumer on Thursday. The three agreed on the need for a stimulus package before the president-elect takes office on Jan. 20.
According to a joint readout of the call between the three, they want to pass a bill “that provides resources to fight the Covid-19 pandemic, relief for working families and small businesses, support for state and local governments trying to keep frontline workers on the payroll, expanded unemployment insurance, and affordable health care for millions of families.”
Analysts’ Stimulus Predictions
As stimulus negotiations drag on, many people doubt that the next stimulus package will be approved before the year’s end. Many leading analysts are also divided on the matter.
JPMorgan Chase’s chief U.S. economist, Michael Feroli, wrote last week that “Something in the neighborhood of $1 trillion late in the first quarter is a reasonable expectation.”
Morgan Stanley’s strategists also expect a stimulus package of a similar size in early 2021.
Goldman Sachs’ analysts are more optimistic, stating that even though the election results are still contested, lawmakers are likely to enact a $1 trillion stimulus package even before Biden’s inauguration in January.
However, they believe that this stimulus package will have only a “small” positive impact on U.S. growth in 2021.