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Coronavirus

Democrats Say Relief Programs Could Become This Generation's New Deal

Congressional Democrats have included some of their longtime legislative priorities in the $1.9 trillion COVID relief package. Republicans accuse it of being an expensive liberal wish list; Democrats say they want a New Deal for the present era.
Congressional Democrats have included some of their longtime legislative priorities in the $1.9 trillion COVID relief package. Republicans accuse it of being an expensive liberal wish list; Democrats say they want a New Deal for the present era.

One of the key aims of President Biden's $1.9 trillion coronavirus relief bill is to send money to people who were already at risk of falling behind on bills or slipping into poverty.

Democrats say the relief bill set to pass the House Friday includes several new programs intended to create a new social safety net that some in the party are comparing to a new, smaller version of President Franklin Delano Roosevelt's New Deal.

"What we're addressing here is the economic disjunction in American life," said Rep. Richard Neal, D-Mass., who chairs the House Ways and Means Committee. "What we're asking for here is an opportunity for people at the lower end of the economic scale, the people that we depend upon every single day in America, incidentally, to get a chance."

The goal, the Massachusetts Democrat says, is to help families stay solvent as the economy continues to suffer. To do this, he says, some elements of the bill, such as an expanded and reimagined Child Tax Credit, would work in concert with programs like food stamps, rent and utility assistance, and health care programs such as Medicaid and the Children's Health Insurance Program.

Republicans say many of the programs included in this bill have nothing to do with addressing the specific demands of the pandemic, like reopening schools and speeding up vaccine distribution.

Indeed, on top of the small-business loans and money for health care included in previous bills, the latest round of relief includes longtime Democratic priorities.

Senate Minority Leader Mitch McConnell, R-Ky., has accused Democrats of taking advantage of their new power in Washington to make good on a plan to turn pandemic relief into an extremely expensive liberal wish list.

"It was last March, remember, when a senior House Democrat called this disaster 'a tremendous opportunity to restructure things to fit our vision,' " McConnell said on the Senate floor. "Americans are suffering, but their side sees an opportunity to ram through ideological change."

Democrats don't exactly disagree. They say they ran and won on a promise to exactly pass these kinds of programs. For Congresswoman Rosa DeLauro that means finally enacting what she calls a federal child allowance that would use the tax code to send families a tax credit as a monthly payment.

"We're looking at lifting people out of poverty with the stroke of a pen," DeLauro, D-Conn., said. "Then you're looking at economic security for middle class families. You know, when you're looking for big change, this is where I look."

The legislation increases the existing child tax credit to $3,000 for children 6 to 17 and $3,600 for children under 6. The amount is gradually reduced for couples earning over $150,000 and individuals earning more than $75,000 per year. Families eligible for the full credit would get payments of $300 per child for young children and $250 for older children, per month, from July 2021 through the end of the year.

The idea is something DeLauro has been working on for 18 years and she says the bill could help half of all children living in poverty.

"You look at the statistics," she says, rattling them off: 50% of Black children would be lifted out of poverty, she says. That figure, she adds, is 40% for Hispanic children, 61.5% of Native American children, 38% of Asian American Pacific Islander children, and 40% of white children.

The idea is essentially an experiment in basic income for families. Democrats have said the bill is aimed at helping people who have been harmed the most in the pandemic because they were already in dire financial circumstances or at risk of falling behind even in a healthy economy.

Many Democrats say the goal is to create a new network of social support programs that could become as widely accepted and widely used as Social Security.

"What this piece of legislation does is ensures that we have built the transforming architecture for something enduring for lifting families out of poverty in the United States," DeLauro said. "We did it for seniors. We are now going to do it for children."

Many elements of the bill, aside from a $15 minimum wage, have widespread support among Democrats and are expected to become law at least temporarily.

Democrats say their goal is to make sure they stay.

"I'm hell bent on making these credits permanent," Neal said.

He says these tax changes, like the child tax credit expansion, may be temporary now but it will be exceedingly difficult for any politician to explain why they support ending relief that gets people, and children in particular, out of poverty.

"I think that the idea always is that once it's in, it'll be very difficult to remove down the road." Neal said. "And my plan here is to make sure that the experiment is not only worthwhile, but is lasting."

But passing permanent programs will likely be much more difficult because they will require bipartisan agreement in the Senate. Democrats are using a budget tool called reconciliation to avoid a filibuster in the Senate, but the complex rules governing budget legislation mean that expensive programs like these must either be paid for or allowed to expire.

All 50 Senate Democrats would have to vote with 10 Republicans to pass a permanent bill. And that is far from guaranteed.

Sen. Mitt Romney, R-Utah, has a competing plan for a monthly child benefit for families. His plan would increase the monthly payments for younger children to $350 and would include expecting parents. The maximum monthly payment would $1,250 per family and would start to phase out for single tax filers earning more than $200,000 and joint filers earning over $400,000.

Those elements might have bipartisan support, but his plan comes with more restrictions. Children would need a valid Social Security Number — which would exclude unauthorized immigrants -- and he proposes ending a long list of other social safety net programs to help pay for the cost of the credit.

Romney's plan would eliminate the Temporary Assistance for Needy Families (TANF) block grant, the Child and Dependent Care Tax Credit (CDCTC), the state and local tax deduction and the head of household tax filing status. He also proposed trimming the Earned Income Tax Credit.

Democrats are unlikely to accept the majority of those ideas. They insist that Biden is committed to these programs and they insist that there will be some other way to make them permanent — though they haven't outlined any specific ways to forge bipartisan agreement.

"I believe with this administration, it will be permanent," DeLauro said. "I believe that [this bill] will be an indelible mark, and we will move forward."

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