PPP Program Refunded; State Aid Next Thorny Partisan Battle

Congress and the White House agreed to a $484 billion package to replenish the very popular Payroll Protection Plan (PPP), plus other disaster lending programs at the Small Business Administration. The legislation, signed by President Donald Trump Friday, also included $75 billion for hospitals and $25 billion for both delivery and research directed at testing.

This week’s legislation, CARES Act 2.0, passed with broad bipartisan support, through a voice vote in the Senate, no objections, and a roll call vote of 388 to 5 in the House of Representatives. The big question now in Washington, D.C., is whether or not the bipartisanship that has marked the first four coronavirus bills can continue as an inevitable fourth bill is considered this summer.

Traditional partisan divides are already appearing.

The most important emerging partisan divide currently is over when and how much states should re-open. States led by Republican Governors have been the first to announce openings. And states led by Democratic Governors have seen protests by people carrying pro-Trump signs.

The President’s leadership has been spotty sending out Tweets saying “Liberate Michigan, Virginia and Minnesota” but he also expressed disagreement with Republican Georgia Governor Brian Kemp for opening non-essential businesses too soon. As the open or not open debate continues it appears to divide mostly along partisan lines.

Similarly decisions on the next legislative steps are also beginning to see similar divisions, led by remarks of Republican Senate Leader Mitch McConnell that Congress should look at the possibility of letting local and state government use the bankruptcy code to solve their fiscal issues rather than sending money. During the negotiations for CARES Act 2.0 Democrats lost their efforts to have money targeted for state aid, but the issue is certain to arise when Congress returns in early May and a new round of coronavirus relief will be top of the agenda.

Figure: Top Trump Tweets

PPP Program Refunded; State Aid Next Thorny Partisan Battle
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