News & Media
Coronavirus April 20 Update: Additional Relief Talks Stall, USDA Proposes $19 Billion Package for Farmers, and Funding Resources for Small Businesses
Coronavirus relief talks stall
White House and congressional negotiators struggled through the weekend to resolve the final sticking points of a nearly $500 billion relief package for the COVID-19 pandemic.
Despite optimistic assessments from both sides Sunday morning that a deal was close at hand, no agreement was reached by nightfall. Multiple sources familiar with the talks, who weren't authorized to speak publicly, said several obstacles remained, including a dispute over which federal agency should administer a new $25 billion virus testing program.
And it wasn't immediately clear whether negotiators were still fighting over a new round of aid to state and local governments. Senate Minority Leader Charles E. Schumer, D-N.Y., told CNN that fresh funding was "so important" to avoid municipal layoffs.
But President Donald Trump told reporters Sunday night that state and local government aid would have to wait for a subsequent relief bill. "That will probably be in our next negotiation," he said.
Even so, the outlines of a deal began to take shape after a long weekend of negotiating.
The pending deal would pump another $310 billion into the so-called Paycheck Protection Program, which provides small businesses with some two months' worth of loans that are forgivable if 75 percent is used to keep employees on staff.
Of the PPP funds, $60 billion would be earmarked for lending by smaller financial institutions. And there would be another $60 billion or so put into the Small Business Administration's Economic Injury Disaster Loan program, which finances loans of up to $2 million directly to firms without a bank as the intermediary. Of that figure, at least $10 billion would be for grants worth up to $10,000 each that wouldn't need to be repaid, according to sources familiar with the talks.
The emerging deal could also include an additional $75 billion for hospitals and $25 billion to fund more testing for a pandemic that had killed nearly 41,000 Americans as of Sunday evening, according to data compiled by Johns Hopkins University.
All told, the price tag was inching up above $470 billion, with possibly more added, including for SBA fees paid to lenders so more of the money could go directly to small businesses. Jennifer Shutt and Paul M. Krawzak have the full story here.
Price tag of the coronavirus relief package is lowered
The mammoth coronavirus relief package enacted late last month will cost less than most lawmakers anticipated, the Congressional Budget Office said Thursday.
The sweeping legislation (PL 116-136), which offered business loans, cash to families, an expanded social safety net and more, will cost $1.8 trillion over the coming decade, the CBO said in a preliminary cost estimate. Lawmakers and independent analysts had previously pegged the price tag at about $2.3 trillion.
But a portion of that aid came in the form of loan guarantees, including $454 billion to support lending by the Federal Reserve. That funding is not likely to increase the deficit because "income and costs stemming from that lending are expected to roughly offset each other," the CBO said in its analysis.
The lower-than-expected price tag softens the budget blow slightly with lawmakers already pushing for another round of coronavirus relief. But the accumulation of relief measures, combined with a crashing economy, is sending federal deficit projections soaring.
Before the coronavirus took hold, the Congressional Budget Office projected in January a deficit this fiscal year of $1 trillion. Adding the cost of the three relief measures passed last month (PL 116-123, PL 116-127, PL 116-136) would bring the deficit total to nearly $2.8 trillion, not counting additional measures currently under discussion.
And none of that accounts for the huge economic hit the nation has taken since the CBO's January forecast, something likely to add substantially to the agency's original $1 trillion deficit estimate for fiscal 2020.
Independent forecasters now expect this year's budget deficit to nearly quadruple the pre-coronavirus estimate, reaching nearly $4 trillion. That amount of red ink in a single fiscal year would dwarf the deficit peak of $1.4 trillion during the Great Recession and, as a share of the economy, approach levels not seen since World War II.
On 4/20, marijuana advocates urge alternatives to smoking, vaping
A cloud hangs over this year's 4/20 celebrations as marijuana advocates contend with the risks of the coronavirus outbreak. Smoking marijuana can cause inflammation of the lungs, according to the National Institute on Drug Abuse, potentially increasing the risk of complications from COVID-19. The virus can attack the lungs, filling air sacs with fluid.
Advocacy groups are promoting safer ways to consume cannabis instead. The National Organization for the Reform of Marijuana Laws, or NORML, recommends vaporizer heating devices to mitigate combustive smoke exposure, or switching to smoke-free edibles and tinctures.
The group also stresses that individuals should avoid illegal products that can contain mold and pesticides, which could lower the immune system. Blackmarket vape cartridges can also contain dangerous contaminants like vitamin E acetate.
Although medical dispensaries are considered"essential" in most states that have legalized them, state-legal marijuana companies have been locked out of congressional efforts to aid small businesses A bipartisan letter led by the House Congressional Cannabis Caucus Thursday urged House leadership to consider marijuana businesses for future loans, payouts and loan forgiveness. "Workers at state-legal cannabis businesses are no different from workers at any other small business—they show up to work every day, perform their duties, and most importantly, work to provide for their families," the lawmakers wrote.
New aid for farmers
Agriculture Secretary Sonny Perdue rolled out a $19 billion rescue plan Friday for farmers who could be forced out of business because of the ripple effects of the COVID-19 pandemic.
Perdue is likely to come under scrutiny over fairness in distributing billions of dollars in direct payments to a cross section of farmers and ranchers, just as he was regarding distribution of trade aid to compensate farmers for lost foreign markets during trade disputes.
However, few in agriculture are likely to question the need for help during the pandemic.
In a statement, the secretary said he is pulling together funding and authorities provided in two economic relief packages (PL 116-127, PL 116-136) and using $873 million of existing USDA funding for food purchases. The department's umbrella name for the aid package is the Coronavirus Food Assistance Program.
Of the $19 billion, $16 billion in direct payments to farmers and ranchers will be "based on actual losses for agricultural producers where prices and market supply chains have been impacted," Perdue said in the statement.
The department will use $3 billion to purchase a variety of agricultural and food products. Purchases are a standard tool the USDA uses to remove surplus products from the market to keep market prices from declining. Ellyn Ferguson has the full story here.