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The stimulus stalemate has turned into a high-stakes political battle in an election year.
But if Democrats and Republicans are able to come to a compromise, Americans could receive more money as soon as October.
The crux of the disagreement comes down to how much and what kind of aid to provide. However, the November election could ultimately lead politicians on both sides of the aisle to decide whether or not to budge.
“We’re in a place where a lot of it is going to depend on the polls right now,” said Howard Gleckman, senior fellow at the Urban-Brookings Tax Policy Center.
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President Donald Trump tweeted on Wednesday that Democrats do not want to give Americans more stimulus payments.
While both sides of the aisle back a second round of stimulus checks, the Democrats’ proposal has been more generous. The HEROES Act, which was passed by the House in May, called for payments that would increase the amount dependents receive to $1,200, for a family maximum of $6,000.
“Maybe what you heard a little bit from Trump yesterday was a little bit of a primal scream,” Gleckman said, as the president works to convince the American public that he is successfully handling Covid-19 pandemic and economic response.
“The question is will he be willing to do something he has rarely done, perhaps never done, in his administration, which is really take the lead on something and stand up and say, ‘This is my legislative priority,'” Gleckman said.
‘Heavy-duty campaign season’
Getting a deal done will not just be determined by party lines. It will also depend on which Congressional seats are up for re-election, and how secure lawmakers’ chances are for getting voted in again.
“We’ve also run now into heavy duty campaign season,” Gleckman said.
That creates conflicting issues between the Democratic and Republican base, he said.
House Democrats in swing districts may feel vulnerable, Gleckman noted, while some Republican Senators could be in trouble.
The whole challenge now is to try to figure out whether or not there’s some middle ground.
senior fellow at the Urban-Brookings Tax Policy Center
Meanwhile, Senate Majority Leader Mitch McConnell, R-Ky., will likely not forward a bill that has approval from a majority of Democrats and only some Republicans.
House Speaker Nancy Pelosi, D-Calif., on the other hand, will likely resist a package that only includes approval from moderate Democrats while leaving out the party’s far left progressives.
“The whole challenge now is to try to figure out whether or not there’s some middle ground,” Gleckman said.
Stimulus checks could go out very quickly
People wait for their numbers to be called at an unemployment event in Tulsa, Oklahoma, on July 15, 2020.
Photo by Nick Oxford for The Washington Post via Getty Images
On Wednesday, White House Chief of Staff Mark Meadows told CNBC that he is the most optimistic he has been that both sides of the aisle can come to an agreement.
“If there’s going to be a deal that actually helps us make a soft landing, I think that deal has to happen in the next week to 10 days,” Meadows said.
If Congress is able to approve a bill next week, more money could get to Americans in October before the election, Gleckman said.
That goes particularly for another round of stimulus checks, which most people now receive in the form of direct deposits.
The IRS and Treasury Department could get most of that money out to Americans in a “matter of weeks,” Gleckman said.
A protester blocks the street leading to the Washington, D.C., home of U.S. Senate Majority Leader Mitch McConnell, R-Ky., demanding the extension of unemployment aid, on July 22, 2020.
Jonathan Ernst | Reuters
Enhanced federal unemployment benefits would likely take more time as some states are already struggling to manage claims, he said.
Any additional aid to states could reach people in a month or two.
The biggest obstacle right now in getting something done is time, Gleckman said.
“The closer you get to the election, the more difficult it is to do this, because all of those tensions just get exacerbated,” Gleckman said. “The political rhetoric gets more and more amplified.”