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Congress Begins Mapping Out Economic Response to Virus Outbreak

Bloomberg logo Bloomberg 3/9/2020 Erik Wasson
a man in a dark room: U.S. House Speaker Nancy Pelosi, a Democrat from California, speaks during a news conference on Capitol Hill in Washington, D.C., U.S., on Thursday, March 5, 2020. © Bloomberg U.S. House Speaker Nancy Pelosi, a Democrat from California, speaks during a news conference on Capitol Hill in Washington, D.C., U.S., on Thursday, March 5, 2020.

(Bloomberg) -- Members of both parties in the House and Senate are moving to craft legislation aimed at stemming the economic fallout from the coronavirus outbreak, including possible tax cuts and expanded unemployment benefits.

House Speaker Nancy Pelosi plans to meet with top Democrats Monday to begin drawing up a response to the economic disruption caused by the coronavirus outbreak, which is already threatening to stall growth.

Pelosi told reporters there is no need to shut Congress down. “At the present time, there is no reason for us not to continue with our vital legislative work in the Capitol,” she said in a message to fellow House Democrats.

President Donald Trump said Monday his administration will discuss a possible payroll tax cut with Senate Republicans. He said they would seek “very substantial relief” for the economy that has been roiled by the outbreak of coronavirus.

The Senate’s top tax-writer, Finance Committee Chairman Chuck Grassley, meanwhile, said he is weighing options for narrowly focused tax cuts and other ways of addressing the virus’s economic effects. Some tax cuts could be targeted toward industries hit the hardest, he said.

“I guess you’d say everything’s on the table,” Grassley told reporters. Asked whether he could support paid sick leave for some people affected by the outbreak, he said the only possibility he sees is using the Federal Emergency Management Agency to help cover hospital expenses for people who don’t have insurance.

“Since you can do that for natural disasters, we might be able to do it for this sort of thing,” Grassley said.

Pelosi and Senate Democratic leader Chuck Schumer released a proposal late Sunday focused on those most directly affected by the crisis -- people who are losing their jobs or being told to go home sick without pay or who are worried they can’t afford to get tested -- as opposed to broad economic stimulus measures.

The expanding outbreak of the virus worldwide and an oil-price war between Russia and Saudi Arabia sent a shock through markets Monday. U.S. stocks plunged more than 7.5% in the worst day on Wall Street since the financial crisis, and crude sank 20%.

More: Trump’s Aides Drafting Economic Steps to Fight Virus Fallout

“Now more than ever we need President Trump” to lead the country’s response “competently,” Schumer said on the Senate floor Monday. He said the administration’s response thus far has been “slipshod.”

Second-ranking Senate Republican John Thune told reporters that he and other Finance Committee members are “just starting to give consideration to any type of menu of options. I think we’re going to wait and hear what the White House has in mind.”

Agriculture Secretary Sonny Perdue told the School Nutrition Association his agency will “do all we can” to grant regulatory waivers to let schools continue providing free and subsidized meals to low-income students if they are closed due to the outbreak.

Perdue said any decision on whether to make more people eligible for food stamps would be up to Trump.

Pelosi will convene a meeting of House committee leaders to discuss the contours of an economic relief package separate from bolstering the nation’s ability to deal with the virus, according to a senior House Democratic aide. Congress last week approved about $8 billion to combat the spread of the virus and lawmakers said they were ready to spend more if necessary.

House Ways and Means Chairman Richard Neal has invited officials from health insurers including Humana Inc., Anthem Inc., Cigna Corp. and Aetna Inc. to meet with him Tuesday to discuss coronavirus testing and coverage, according to a House Democratic aide.

Multiple Democratic aides said it’s hard to know the right response on the economy because the virus has been stifling demand as people curtail travel, businesses cancel events and suppliers are suffering shortages.

Pelosi and Schumer on Sunday called for expanded paid sick leave, enhanced unemployment insurance for those laid off due to the virus crisis, expansion of food stamps and school lunches, anti-price gouging protections and free virus testing. It also calls for government reimbursement of virus treatment costs not covered by insurance and greater distribution of protective equipment to health workers. The exact details how these goals are to be achieved have yet to be worked out.

More than a quarter of private U.S. workers don’t get any sick leave with their jobs, including more than half of part-time workers and about 40% of service employees -- and about one-third of private U.S. workers don’t get medical benefits via their employment, according to government data.

The Joint Economic Committee also plans this week to examine the most efficient way of providing relief to the economy, Vice Chairman Don Beyer, a Virginia Democrat, said on Monday.

Separately, Transportation and Infrastructure Chairman Pete DeFazio said in an interview that given low interest rates, enacting a major infrastructure package makes more sense than ever. Infrastructure spending is a perennial favorite proposal for economic stimulus, but getting any plan through Congress would depend on what Trump and Republicans are willing to go along with. It also would be more long-term spending than a quick jolt for the economy, given the limited number of shovel-ready projects.

Little Time

There would be high hurdles to passing a bill this week as Congress plans to leave Washington for a week-long recess on Thursday. Skittish lawmakers worried about contracting the coronavirus may press leaders to extend the recess.

Three Republican members of Congress, Texas Senator Ted Cruz, Representative Paul Gosar of Arizona and Representative Doug Collins of Georgia, have placed themselves in self-imposed quarantines after coming in contact at a recent political conference with a person who later tested positive for the coronavirus.

On Wednesday, the Education and Labor Committee will examine the Health Families Act, H.R. 1784, and the wider issue of requiring employers to provide paid sick leave. The author of the legislation, Connecticut Democrat Rosa DeLauro said Monday she couldn’t say how quickly any virus relief bill could be passed.

“Everybody is trying to move at warp speed as it were but I can’t give you a timeline,” she told reporters.

(Updates with Pelosi, Trump comments starting in third paragraph)

--With assistance from Steven T. Dennis, Justin Sink, Alexander Ruoff, Laura Litvan, Daniel Flatley, Mike Dorning and Nancy Ognanovich.

To contact the reporter on this story: Erik Wasson in Washington at

To contact the editors responsible for this story: Joe Sobczyk at, Laurie Asséo

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