House Democratic leadership has brushed aside the deficit peacocks like Sen. Joe Manchin trying to impose austerity on survival checks in their $1.9 trillion bill fulfilling President Biden's American Rescue Plan. They released legislation late Monday proposing sending the $1,400 survival checks at the same level as previous payments, starting the phase out at $75,000 for an individual, $150,000 for couples. Manchin and others, including Republican Sen. Susan Collins, had been pushing to start the phase out at $50,000.
House Democrats have been coordinating with the White House, so it's likely that Biden signed off on this and moving ahead without regard to what Republicans are demanding. In a nod to Manchin, however, the drop-off for incomes higher than $75,000/$150,000 will be sharper than in previous rounds with the cutoff at $100,000/$200,000. But here's an important correction: it will account for any drop in 2020 income. If you get a partial payment based on your 2019 income but qualify for the full benefit because of income loss in 2020, when you've filed for 2020 the IRS will send the remainder of what you're owed based on that income. It's not clear if that's retroactive to the previous rounds of payments, but at least it's a key correction for this one.
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Manchin didn't immediately indicate he would fight this in the Senate, where his vote is necessary for the it to pass. "We're just trying to make sure that people are truly in need," he told reporters. He was facing a united front of Sens. Bernie Sanders and Ron Wyden in the Senate. Those are the two writing the most critical parts of the larger bill. Sen. Jon Ossoff from Georgia, whose promise of survival checks was central to his election, has also weighed in to remind colleagues of that. "Working and middle class Americans have been crushed by this crisis and deserve immediate financial relief," he tweeted Monday. "That's why I'm fighting against cuts to the direct payments families are counting on. Send the people help!"
"Our nation is struggling, the virus is still not contained, and the American people are counting on Congress to meet this moment with bold, immediate action," Ways and Means Chair Richard Neal said in a statement releasing this part of the bill. He pushed back against the idea that the bill has to be watered down to appeal to Republicans. "While it is still our hope that Republicans will join us in doing right by the American people, the urgency of the moment demands that we act without further delay," he continued in the statement.
The legislation released Monday has other critical components to provide longer-term assistance for struggling families, most notably the cash benefit for families with children. It also increased premium subsidies in the Affordable Care Act for two years, making plans far more affordable, and provides full premium subsides for the unemployed.
The one point of contention right now between House and Senate is extension of the boosted unemployment insurance. Neal's plan extends it to August; Wyden said in response he will push for them to last through September. "[I] am going to work to find a resolution that preserves both relief payments and jobless," Wyden said. "We can do both." That should be a fairly easy one. Ending them in August potentially screws up August recess and the congressional schedule, setting up another needless benefits cliff. Having them end with the fiscal year gives Congress the option of including them with government funding. That gives Republicans less of a chance to create chaos and increases certainty for everyone.
These developments put the House on track to meet House Speaker Pelosi's deadline of having the package completed in the next two weeks, giving Congress time to have the bill done before the looming deadline of March 14, when the current extension of unemployment insurance expires.