Congress must take on coronavirus and its effects (photo: Jeff Reed/City Council)

The Senate Should Pass the Act, More Aggressive Measures Needed to Alleviate Widespread Human Suffering and Avoid Severe Recession

Early Saturday morning, the U.S. House of Representatives passed comprehensive legislation that would begin to ease the economic hardships Americans are facing right now as a result of the developing coronavirus crisis. However, as of Tuesday evening, the Senate has yet to act.

The Families First Coronavirus Response Act provides free coronavirus testing, increases funding for states’ Medicaid costs, strengthens food security initiatives, enhances unemployment insurance, and provides paid sick leave and paid family and medical leave through refundable payroll tax credits.

The House deserves recognition for acting swiftly on what’s being referred to as Phase Two of their response – Phase One being the $8.3 billion spending package that focused on tests, treatment, vaccines, and telehealth provisions – while simultaneously working on the details of Phase Three.

However, with the nation’s economic centers nearly closed, business grinding to a halt across the nation, and the stock market continuing to plunge, the coronavirus outbreak is extremely likely to result in a recession. Indeed, both major political parties and the Trump administration acknowledge that Phase Two is merely another first step.

Reflecting on the recent decade-long economic growth period – which, in part due to budget austerity, left too many Americans behind, and disproportionately people with low incomes and communities of color and immigrants  – is instructive. Already, nearly half of all New York City residents cannot afford their most basic needs, let alone an emergency. Absent sweeping revisions to social safety net programs that were already insufficient, such as child care, cash assistance, support for older adults, aid for food, and so on, the human toll will be devastating.

As such, Phase Two must be passed by the Senate and Phase Three advanced. Phase Three must enact bold fiscal policy measures to stave off a severe economic calamity and address the shortcomings in the Families First Act.

On fiscal policy, the president continues to press for his payroll tax cut. But that relief would be too slow, not well targeted, and too narrow – nearly two-thirds of the tax cut (65 percent) would go to households in the top 20 percent. While meaningful differences in the details exist, U.S. Senator Mitt Romney joined progressive policy experts in calling for rebate or “stimulus” checks for unemployed and employed Americans that would put money into peoples’ hands quickly.

While the Families First Act is enormously important, it is indeed only part of the first step response to the coronavirus crisis. Advocates are rightly concerned about the following (among other things): 

The bill reduces the state’s Medicaid share by 6.2 percentage points, meaning New York will now pay 43.8 percent of costs instead of 50 percent. However, this may prove to be insufficient given the extent to which the state budget will be squeezed by falling tax revenue and increasing costs.

A paid leave provision that focused on survivors of domestic violence, sexual assault, and stalking was stripped from the bill, and; the Act does not ensure that caregiving covered by both paid sick days and paid leave includes all caregiving for adults and children with disabilities.

The revised version of the Act only provides paid family leave of up to 12 weeks to people taking care of kids who aren’t in school. In the original version, all workers who received paid sick time would have been eligible for another 10 weeks of paid leave at two-thirds pay.

The Act does not provide resources to shelter providers to quickly and permanently house people who are homeless and at high risk of infection.

Workplace safety standards for health care workers were scrapped by industry lobbyists.

Food assistance benefits through the Supplemental Nutrition Assistance Program (SNAP) should be increased across the board as they were in response to the Great Recession.

Although the Act ensures access to free coronavirus testing, even for the uninsured, the legislation does not address treatment costs for the uninsured, and those with private insurance may face complications in the event of hospital bed shortages.

And while the bill addresses nutrition assistance for older adults, it does not address health insurance affordability and access to home and community-based services to reduce the risk of infection.

The coronavirus outbreak is an unprecedented crisis, and the economic and human toll due to illness and the daily disruptions to our lives will be widespread. The U.S. Senate should swiftly pass the Families First Act to provide immediate relief and the certainty that Congress is functioning in a crisis. Immediately following, the House and Senate must again act swiftly and aggressively to alleviate human suffering and avoid a severe economic recession.

***
Derek Thomas is Senior Fiscal Policy Analyst at FPWA. On Twitter @dlthomasNYC and @FPWA.