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The Washington dynamics on rescue aid have started to shift

Posted April 22, 2020 9:48 a.m. EDT

— The US Congress will soon send another half-trillion dollar rescue package to the President's desk.

Capitol Hill leaders have agreed to $2.7 trillion in spending to address the economic devastation wrought by the Covid-19 pandemic. Most lawmakers acknowledge that is -- still -- likely not enough. But dynamics in Washington are starting to shift.

Bottom line: There is bipartisan acknowledgment that more will need to be done legislatively to address the pandemic fallout. But how and when to get there -- well that is now a matter of sharp disagreement. A growing number of Republicans want Congress to reconvene. The policy and ideological differences between the parties will be exposed in spades in the next phase of legislation. The first four rescue packages weren't easy -- the negotiations were long and complicated. But those will pale in comparison to what's coming, which raises the question if anything else is coming at all.

What's next: The House on Thursday will vote to pass the package. Unlike the Senate, it won't be done unanimously, and lawmakers have been called back to Washington for votes.

Just saying: Think back to any time before the current pandemic, and the idea that a nearly *half trillion dollar* spending package would not only be passed unanimously in the Senate, but be considered just an "interim" response would get you laughed out of every room in Washington.

What you should have been watching Tuesday

The Senate floor on Tuesday was instructive -- and not because the chamber passed another massive rescue package without a recorded vote. Instead it's what happened beforehand. Three Republican senators, Mike Lee of Utah, Rand Paul of Kentucky, Dan Sullivan of Alaska, all in Washington to give floor speeches about the need to back in Washington and working.

Lee and Paul made clear they had issues with how the interim package was constructed. Shortly after, Senate Majority Leader Mitch McConnell, a Kentucky Republican, made clear the Senate wouldn't consider any more rescue or stimulus legislation until the full Senate returns.

This was days, if not more, of internal conference frustration with the current dynamics moving into the public sphere.

Pin these quotes

The issue of the debt has largely been tied up and tucked in a closet for the last two months, which is why this comment from McConnell to reporters on Tuesday made ears perk up: "I think it's also time to begin to think about the amount of debt that we're adding to our country and the future impact of that."

Now compare that to how Senate Minority Leader Chuck Schumer, a New York Democrat, said of his expectations of the next legislative package, which would be the fourth round of assistance: "There will be a big, broad, bold Covid-4. For anyone who thinks this is the last train out of the station, that is not even close to the case."

Again, there is bipartisan awareness that more will be needed to address the unprecedented economic shutdown in the country. But Republicans and Democrats have been fairly aligned in the last month in putting together massive rescue packages. There are now clear divergences in what's coming next, what's needed, and when.

About that urgency: It may be less than a week before lawmakers are confronted with an urgent need, according to bank executives and industry sources. The interim rescue package includes $310 billion for the Small Business Administration's Paycheck Protection Program, which ran dry last week.

In surveying bank executives and industry sources, that money is likely to go out the door in a matter of days.

"Maybe two, maybe 10, but it will be days, not weeks," one bank executive told CNN, noting the thousands of applications the executive's institution had waiting to submit as soon as the program reopens.

So what happens when the funding runs dry again -- and lawmakers are still far away from even agreement on the broad outlines, let alone extremely important details, of the next rescue package?

The wildcards

There are really two here -- the economy, and the President.

The economy: The depth of the economic disaster was what has brought lawmakers together on the preceding four legislative responses. Even the interim legislation slated to be signed by President Donald Trump this week was driven by economic realities: the initial funding for the Paycheck Protection Program had run out in 13 and a half days. It needed to be refilled, and perhaps most importantly, the President (and Treasury Secretary Steve Mnuchin) asked for it to be refilled.

So the economic numbers matter in terms of what happens next. Keep an eye on the Federal Reserve, the vast array of bazooka-like lending programs the central bank has rolled out and the Fed Chairman Jay Powell, specifically. Powell has been on the phone with leaders in both parties in recent days, CNN reports. His view on what is needed or necessary matters here -- a lot.

The President: Trump has been extremely vocal about his desire for another rescue package -- this one with a more broad stimulative effect than the life-raft-like packages of the last six weeks. Much of what Trump wants specifically -- major infrastructure investment, payroll tax cut, appear completely out of the realm of possibility in talking to lawmakers and aides in both parties. But his desire for something -- and something substantial -- will go a long way in determining what happens next. There's a 0% chance Republicans would've been on board with the scope and scale of the nearly $3 trillion in emergency spending program had Trump not gotten fully behind the measures. Trump's role in pushing for the next rescue package will be more important than ever if he wants one.

The broad push to return

This isn't limited to Senate Republicans. In fact, it's even more palpable among House Republicans. On Tuesday, top House Republican Kevin McCarthy of California sent a letter to House Speaker Nancy Pelosi urging her to develop a plan to get members back to Washington. That letter didn't come out of the blue, it came after countless suggestions from members on private calls to get back to the Capitol.

"In my view, conducting the business of the people's house is the definition of 'essential work' -- just as many of our friends and neighbors continuing to hold up our communities on a daily basis." McCarthy wrote.

For the last week, the issue of returning to Washington has emerged as a common refrain from members of the House, according to one source familiar with those conversations. Several members feel like it is their duty to return, and it isn't just Republicans. Last week, Rep. Jason Crow, a 41-year-old Democrat from Colorado, told CNN he thought that members who were healthy enough, should come back immediately.

The frustration: It's a combination of reasons. For one, members who aren't in leadership feel like forcing members to agree on everything by unanimous consent isn't sustainable. They want more say, and as one aide put it to CNN, there isn't much chance to influence the legislative process when everything is being negotiated by McConnell, Pelosi, Mnuchin and Schumer. On the other hand, now is not a moment where members are able to do traditional constituent outreach at home. They can't go to the scenes of tragedy, they can't go to town halls. The view is emerging that they might as well be in Washington.

The pushback: This isn't a unanimous view -- not even within the respective GOP conferences. Pelosi and Schumer both made clear Tuesday they would prefer Congress to be in session, but said that decision needed to be guided by health experts, with consideration to the employees around the Capitol, not just the lawmakers themselves. Pelosi has teed up a House vote Thursday to allow proxy voting during the pandemic to try and address some of the issues.

What about proxy voting?

Republicans don't support proxy voting, and House GOP Whip Steve Scalise of Louisiana sent a notice to his members on Tuesday urging them to vote against the proposal when it comes up Thursday. Overall, the feeling is that more needs to be done to include rank-and-file members in the legislative process, and proxy voting is not going to cut it. Republican aides say that we should expect a fair number of Republican members to return to Washington to vote against the proposal. Right now, as one aide put it, members just want to get back to work.

What it all means

This is going to become a much more dominant story line in Washington in the days ahead, and it tracks in large part with the push by certain states to ease restrictions before others.

It's the tension between those who want to get back to work, regardless of the risks, and those who are cognizant of the risks and want to be guided purely by public health officials. More broadly, this debate is going to become intertwined with talks about the next rescue package. That, perhaps more than anything, is likely the most important effect of the "return to Washington" debate.

"People feel a responsibility. People are going through a profound crisis, and I think there is a real frustration we aren't in Washington," one aide said.

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