After months of bickering, Congress Reaches Final Agreement on Pandemic Relief.
- Direct checks are expected to be $600 per adult and $600 per child, with the amounts decreasing for individuals with more than $75,000 in income and $150,000 for couples. Dependents over the age of 16 don’t qualify.
- Add $300 to weekly unemployment payments for 11 weeks
- Extend two other unemployment programs until they begin phasing out in mid-March and end in early April. Those two programs expand the pool of people eligible for unemployment benefits and extend their duration.
- $15 billion for airline payroll support.
- Roughly $280 billion would go toward the Paycheck Protection Program.
- $325 billion goes toward small businesses.
- Theater operators and owners of small performance venues would be eligible for $15 billion in grants.
- Schools would receive $82 billion under the agreement, and $10 billion would go toward child care.
- The deal would also include $25 billion in rental assistance
- Moratorium on evictions extended
- $30 billion for the procurement and distribution of a vaccine, as well as testing and tracing.
- $1.8 billion in tax credits for businesses to provide paid leave.
- Ability for businesses to deduct restaurant meals.
- Renewable-energy breaks, including incentives for wind energy and carbon capture, would get temporary extensions.
- Extend a tax credit for retaining employees and make it available to PPP recipients.
- The remaining funding previously provided to the Treasury Department to backstop losses in Fed lending programs would be revoked, and the Fed wouldn’t be able to replicate identical emergency lending programs next year without congressional approval. The compromise will ensure the Fed and the Biden administration can’t restart the lending programs “by creating a clone and calling it something different,” Senator. Toomey told reporters Sunday.
- The final package would also prevent patients from receiving surprise medical bills, including from air ambulance rides. Surprise billing typically occurs when a patient is treated at a hospital in his or her insurance network by a medical professional who isn’t, potentially leading to crippling medical charges.
- Pell Grants
- $1 billion in federal loan forgiveness for Historically Black Colleges and Universities
- Climate change items such as reducing chemicals used in air-conditioners and refrigerators.
What’s Not?
- Funding for hard-hit state and local governments, a Democrat priority.
- Liability protections for businesses and other entities operating during the pandemic, a GOP priority.
“Once this deal is signed into law, it cannot be the final word on congressional relief,” Mr. Schumer said on the Senate floor. “There’s more to do in the new year, with a new administration that has a much more favorable attitude toward giving the American people the help they need.”
Democrats Got Far Less Than They Wanted
Democrats got far less than they wanted, and even much less than what McConnel offered before the election.
Republicans are poised to hold the Senate and have insisted on no state bailouts.
Big Winners
The big political winner is Senate Majority leader Mitch McConnell. This is the compromise deal he proposed many weeks ago.
Other big winners include those who are working yet receive blanket checks anyway.
Despite months of wrangling, Republicans and Democrats did not come up with a way to target the funds better.
Big Losers
Landlords who have tenants who don’t pay the rent have continued pain until March 1.
Addendum Additions
Added points 18-20 to “What’s In It?” section above.
Addendum 2
The eviction moratorium extends through February 28. I modified a sentence above that read March or April depending on final agreement.
Addendum 3
Covid Bill is 5593 Pages Long
Apologies for not knowing precisely what was in the bill, but I am sure no one else did either, or still does, except the lobbyists who wrote it.
The bill is 5593 pages long and was sent out as a corrupted file.
Mish
Will the aid to Pakistan include new bathrooms for every letter of the alphabet?
The eviction moratorium extends through February 28. I modified a sentence read March or April depending on final agreement.
I’m seeing Jan 31. See page 2281.
“1 SEC. 502. EXTENSION OF EVICTION MORATORIUM.
2 The order issued by the Centers for Disease Control
3 and Prevention under section 361 of the Public Health
4 Service Act (42 U.S.C. 264), entitled ‘‘Temporary Halt
5 in Residential Evictions To Prevent the Further Spread
6 of COVID–19’’ (85 Fed. Reg. 55292 (September 4, 2020)
7 is extended through January 31, 2021, notwithstanding
8 the effective dates specified in such Order.
“
A quick thought experiment reveals that mass evictions can never occur.
These moratoria are just can-kicking exercises. Eventually, landlords must be made whole via direct Federal grants in special courts, because renters will never be able to make up back rent.
Alternatively, a special federal lending program could be made available to renters to finance back rent owed. Don’t take the loan, pack your things. As for defaulting on the loan….
BEIJING (Reuters) – China’s manufacturing recovery, fuelled in part by demand from COVID-constrained consumers abroad, has soared past expectations this year, so much so that factories are now struggling to fill a shortage of blue-collar workers to clear mounting orders.
The country’s output of industrial robots, computer equipment, and integrated circuits has roared back from its coronavirus paralysis – production for the year to November is up 22.2%, 10.1% and 15.9%, respectively.
Much of the manufacturing boom has come from foreign demand, with export growth topping expectations for eight of the last nine months.
The remarkable turnaround comes as China has mostly eradicated the virus and contrasts with the sluggish comebacks seen in major industrialised peers, where factories are still struggling with pandemic disruptions and the hit to demand.
China’s global export share increased to over 13% in the second and third quarters from 11% last year, according to Nomura, the highest for any quarter since at least 2006 when the investment bank started compiling the data.
While emergency stimulus in the United States and Europe pumped money into consumers’ wallets, the fight to contain the virus in those markets fired up demand both for China-made PPE goods and gadgets for westerners stuck at home.
It is possible the rest of the world is stockpiling so no gaps occur during on-shoring of manufacturing. People now realize they underestimated or neglected the risks associated with doing business in China.
On-shoring? are you being sarcastic, right?
Three-martini lunch tax break come back into existence, in exchange for additional tax credits for working poor and low income families.
The airlines have better lobbyists than I would have suspected. For an industry that really isn’t all that essential , has capital tools at is disposal and has made tons of mistakes I get apoplectic just seing the 15 billion number. I’m far ore forgiving with mass transit which is not a for profit business and benefits lower income and working class people far more.
The real winners will be Amazon and Chinese workers.
I wonder if this will help M1 achieve escape velocity-
Velocity still very low…
Escape velocity (as in that needed to leave the surface of a celestial body), not monetary velocity, which is low. Was just commenting on the chart going vertical, apologies for mixing science with economics 😀
I won’t borrow any more money, so I’m only going to spend what I can get forgiven.
Let’s see what the rules are for the new PPP money. I still haven’t applied for forgiveness on the first round. That’s about to become a higher priority though.
It doesn’t make sense to give out SBA loans to businesses that have no hope of paying them back…..and businesses like mine that are already looking at a big new long term debt repayment won’t borrow more unless they desperately need it. Or shouldn’t anyway.
But what I expect is that human nature will lead people to take out more instant loaned money…and that the increased debt will just be another albatross around their necks. The bankruptcies might go on for a few years until this is sorted out.
Loaning money into existence is only helpful if the cash flow to pay the loans back is coming in. Right now it isn’t.
I doubt we’ll see the spending exuberance this time we saw last spring….with rising infection rates and no vaccine yet for most of us. So the money might go into the mattress this time.
Pretty generous of Schumer to promise more freebies to the people, and it isn’t even an election year!!
In the spirit of the season, could you get Oprah to read off this list?
Mish, remember the Harvest Gold, Avocado Green and Coppertone “Frigidaire By GM” refrigerators from the 50s and 60s? Those lasted forever and you can still find them in old apartment buildings. People just got rid of them because they were too lazy to clean them or tired of the colors. Yeah, a new stainless steel one shipped from China that will be in a landfill in 5 years is better for climate change.
I remember calling them the “Ice Box”
We had an Ice Store in Danville and my mom used to go pick up a big chunk of ice to put in one.
My wife bought one of those in the early ’70’s. Big purchase. Tip top refrigerator. I fixed it several times over the years, but it finally died for good a few years back. Just in time for the electric company to offer “free” refrigerators. Essentially the same reefer as the old one, but using less electricity. Now, in the stores, such units are cheap, bottom of the line. They work, though. So, for “free”? You bet.
Watch out for survivor bias.
Ha, ha. One more category of losers: Anyone whose value is tied to dollars. Will be hard to see if the presses are throttling up all over the world.
The energy savings from modern refrigerators more than makes up for the longevity of the older mechanicals. Too bad we can’t have both though. No real reason, other than planned obsolescence.
seems like something a few fresh grads would start working on. an efficient fridge with a 10 year guarantee
Everything is about keeping costs low. Such refrigerators have been built.
Sun Frost was a company that pioneered them for the off-grid market, 20 years ago or more…back when solar and wind gave people way less power than what most off-grid people have now.
Now, almost all the refrigerators used off-grid are just ordinary refrigerators with a high energy star rating…….way cheaper than a Sun Frost.
You can buy a nice small freezer from Costco or Sam’s for a couple of hundred bucks now. I bought a nice refrigerator for my lake house….full size……for I think $600 if I remember right…..a year or two back.
In the age of Avocado Green appliances you paid more…and the dollars were worth a lot more too. So in real terms they were MUCH more expensive back then.
Ive just reconfigured my budget to not expect any rent for awhile from one tenant. We little guys havent got PR group in Washington.
It’s really kind of you to pick up slack for the government…. not that you have any choice.
Yes, I think that is so wrong. You thought you owned the home you rent out but find that you really don’t own it, until the property taxes are due, than you own it.
The eviction moratorium extends through February 28. I modified a sentence that read March or April depending on final agreement.
I don’t expect the economy to pick up next year so we can expect more of the same moving forward. Another benefit will be gold price will be going up. I just don’t see how we get any GDP other than what they print.
Gold got gobsmacked just after the London open. Just about the time the dollar, which has been rising since the middle of last week, reversed to the downside.
If the dollar keeps falling, I’d expect gold to be hit at least one more time, maybe twice. TPTB will not let gold break out just now…..it probably will trend higher over the next several months….but I wouldn’t look for any huge moves.
Silver and bitcoin have much better potential than gold for now.