Biden’s $1.9tn stimulus plan faces growing Republican backlash


US president-elect Joe Biden’s $1.9tn economic stimulus plan faced a growing backlash from Republicans in Congress on Friday, highlighting his challenge in securing strong bipartisan backing for the relief package.

Pat Toomey, the Pennsylvania senator, and Rick Scott, the Florida senator, joined Republican lawmakers in the House of Representatives who attacked the plan after it was announced in a speech by Mr Biden on Thursday night.

“Blasting out another $2 trillion in borrowed or printed money — when the ink on December’s $1 trillion aid bill is barely dry and much of the money is not yet spent — would be a colossal waste and economically harmful,” Mr Toomey said in a statement.

The initial negative reaction to the plan from Republicans represents a rebuke to Mr Biden’s appeal for “unity” and a speedy approval of the stimulus plan, which will become his top legislative priority after his January 20 inauguration.

While Democrats control the House of Representatives, the Senate is evenly split, with vice-president-elect Kamala Harris casting any deciding vote.

Senate rules require a 60-vote supermajority threshold for legislation to pass, but Democrats could still pass the stimulus plan with a simple majority using a parliamentary procedure called reconciliation that is reserved for tax-and-spending bills. However, this would force Democrats to remove any unrelated measures in the package, such as an increase in the federal minimum wage.

The result of the Republican scepticism is that the overall pricetag of Mr Biden’s stimulus package may be reduced during negotiations on Capitol Hill, with some measures stripped out.

“The end result will probably be another fiscal relief package, but it is also likely to be much smaller than proposed,” economists at Moody’s Analytics said on Friday, estimating that it would be “no more than half the size” of Mr Biden’s plan.

Elements of the plan could also be resisted by centrist Democrats such as Joe Manchin of West Virginia.

Mr Biden’s team is also grappling with uncertainty over the timing of consideration of the stimulus bill in the Senate, which is also set to hold the impeachment trial of outgoing president Donald Trump for inciting a deadly riot on Capitol Hill.

The main elements of Biden’s stimulus plan

$465bn — Direct stimulus payments to individuals of up to $1,400 each

$350bn — Aid to state and local governments

$350bn — Extension of emergency jobless benefits of $400 per week

$170bn — School and university reopening funds

$160bn — Coronavirus vaccination, testing and tracing funds

$120bn — Child tax credit expansion

$250bn — Combination of other policy changes

Source: Analysis of plan by Committee for a Responsible Federal Budget

Nancy Pelosi, the House speaker, has not said when she will send the article of impeachment to the upper chamber, which would trigger a trial, possibly as early as next week. On Friday, she sidestepped questions from reporters on timing: “You’ll be the first to know, when we announce that we are going over there.”

Many Republicans have embraced more direct payments to individual Americans, and would likely back Mr Biden’s proposal to send out cheques of $1,400. But the party is opposed to $350bn of spending on aid for state and local governments — a key Democratic priority.

“I will continue fighting for targeted relief that provides needed assistance to Americans hit hardest by this pandemic,” said Mr Scott. “But I will not stand by and let failed liberal policies be used to mortgage our kids’ and grandkids’ futures.”

Mr Biden and his top economic aides have argued that the US economy remains in desperate need of help to cope with a slowing recovery at a time when the coronavirus pandemic is still raging.

Discouraging data this week — including a surge in unemployment benefit claims and weak retail sales figures — have added to concerns about fading economic momentum.

As well as direct payments and aid to states, the $1.9tn stimulus plan presented by Mr Biden also includes a boost to the child tax credit, an extension of unemployment benefits, as well as funding for school reopenings and vaccinations.

Although the plan received overwhelming backing from Democrats on Capitol Hill, some progressive lawmakers complained that it was not ambitious enough.

Cori Bush, a Democrat from Missouri, wrote on Twitter that the $1,400 cheques were not the same as $2,000, while Alexandria Ocasio-Cortez of New York said she wanted the boost in unemployment benefits to apply retroactively.

Bernie Sanders, the Vermont senator due to chair the budget committee, called the plan “a very strong first instalment”.


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