House coronavirus bill to cost $2.5 trillion

The coronavirus stimulus bill House Democrats unveiled Monday would cost an estimated $2.5 trillion, nearly 40 percent more than the $1.8 trillion bill being considered in the Senate.

The House bill removes restrictions  on paid sick and family leave that were in an earlier coronavirus package signed into law, expands unemployment insurance and includes strict conditions for corporations receiving federal bailouts.

House Speaker Nancy Pelosi (D-Calif.) has said the House may take up the Senate version if a bipartisan agreement is reached but threatened to call back the lower chamber for a vote in the event of a deadlock.

Senate Minority Leader Charles Schumer (D-N.Y.) on Monday said that negotiations with Treasury Secretary Steven Mnuchin were making steady progress and that he was hoping for a deal by day’s end.

Democrats twice blocked the bill from advancing in the Senate over complaints that it was not tough enough on big corporations set to receive money from the package and that it lacked enough funds to bolster the health care response to the pandemic.

Republicans have blasted Democrats for holding up the bill, arguing their demands include provisions tied to climate change and other issues that should not be part of the current debate.

Stock markets fell further on Monday, putting pressure on both sides to reach a deal. Senate Majority Leader Mitch McConnell (R-Ky.) has sought to use the market tensions as leverage in the political battle.

Economists have called for significant government spending in the face of the pandemic, which has taken a tire iron to the economy. Forecasters are expecting a huge spike in unemployment and a massive economic contraction in the second quarter of the year. Markets have lost more than a third of their value since peaking in February.

A $2.5 trillion package would increase annual government spending, including Social Security, Medicare and Medicaid, by more than 50 percent. It would triple the annual deficit.

Experts argue that increasing deficit spending is important for battling an economic downturn, though fiscal hawks lament the unbridled rise in deficits and national debt during the flush times that preceded the crisis.