What the American Rescue Plan Tells Us About the Biden Administration
By: Ian Connor Linnabary, Gen Z GOP Blog Contributor
A little less than one year ago, the 116th Congress made history by passing the Coronavirus Aid, Relief, and Economic Security (CARES) Act to combat the economic crisis caused by the Covid-19 pandemic. This bill was notable as one of the most expensive rescue packages to ever be passed by Congress. But what truly made this bill stand out was that it was passed on an entirely unanimous and bipartisan basis, with every present member of the Senate voting either neutrally, or in favor of its passage. This bill represented a genuine, bipartisan effort by our elected officials to give much needed aid to Americans struggling during the pandemic. Unfortunately though, the spark of collaborative spirit that inspired that effort has passed. The new Congress is now poised to pass the next round of Covid-19 relief, the first round to be delivered under President Biden. Like the bipartisan package passed in March of last year, the proposed bill will rank among the most expensive in American history. However, unlike last year’s legislation, this package, known as the American Rescue Plan, has garnered almost unilateral opposition from the GOP.
When reading the fine print of the House version of the bill, one can see that it is filled with massive spending provisions — the likes of which we have not seen prior to the pandemic. Breaking down the House version of this bill (which is subject to change in the Senate),we can see that it appropriates $75 billion for vaccinations, treatments, testing, and medical supplies; $19 billion for public health; $6 billion for Native American health services; $7 billion for the Paycheck Protection Program (a legacy of the March 2020 package); $15 billion for Injury Disaster Loans; $26 Billion in aid to the restaurant industry and $250 billion for unemployment provisions. This bill also includes a section that allocates $350 billion dollars to state and local governments. This provision, one of the most contentious, was put in the bill by Democrats as a way to help aid state and local governments in balancing their budgets and fixing budget deficits. This funding will be appropriated to states and localities based on unemployment rates. The problem with this though, is that current unemployment numbers have been inflated by the effects of overly restrictive lockdowns that hurt businesses and jobs, so in reality, this bill would be subsidizing bad policy with federal tax dollars. On top of this, when we look at the actual budget of many of the states that will be receiving this funding (due to their high amount of unemployment), we see that many of them are not experiencing a crippling budget deficit. In fact, some states, such as New Jersey and California, are experiencing budget surpluses despite the economic effects of the pandemic. In addition to the certain states experiencing surpluses, JP Morgan also found that 21 states had revenue increases in 2020. And even though some states have had to reach into reserve funding to combat the pandemic, those reserve funding pools exist for a reason, so this on its face shouldn’t qualify them to receive massive amounts of federal tax dollars.
Another major provision in this bill is $401 billion in stimulus checks. The American Rescue Plan’s proposed structure for these checks has been criticized by members of the GOP for many reasons, one such reason being that portions of this money would go to individuals who haven’t seen a change in income due to the pandemic. Some also argue that another round of stimulus checks aren’t necessary at all, given that we are seeing many states and localities open their economies back up to workable levels. In addition, another major piece of spending included in this bill is aid to our public school system, with about $170 being appropriated to schools. This part of the bill has also garnered criticism from Republicans because the bill does not include any plan for reopening schools. Even after many promises from Biden and his communications team, that the administration is committed to reopening schools within the first hundred days of their administration. This provision seems even less sensical when one realizes that as of February 24th, 2021, $68 billion out of the $80 billion already appropriated for this purpose has yet to be spent. On top of this, the Congressional Budget Office has estimated that only 4% of K-12 spending in this bill will take place in 2021, with some funds remaining unspent into 2029.
While it may seem like I’ve listed nearly all of this bill’s spending provisions, those that I’ve mentioned still don’t encompass the entirety of this massive $1.9 trillion bill. In the end, any close reading of the American Rescue Plan reveals many untargeted provisions that are arguably unnecessary at this point in time. Because of these very real flaws in the legislation, the bill has garnered significant opposition from the GOP, with the measure getting zero affirmative votes from House Republicans. While party-line votes aren’t a new phenomena by any means, it is significant that this pushback isn’t just politics. The GOP genuinely wants to see the American people get the relief they need and have been hard at work to make a targeted, reasonable relief bill happen. Just last month, a group of Senate Republicans met with President Biden to propose a $618 billion alternative. This Republican alternative includes several of the same provisions, but in a more targeted and fiscally responsible form. One of the Senate Republicans who met with President Biden, Utah’s Junior Senator Mitt Romney had this to say of the effort: “We stand ready to negotiate a plan that helps America recover, both physically and financially, from this dreadful disease.” He continued by saying “We have shown a willingness to compromise — which the President and Democratic congressional leaders have yet to reciprocate.”
At the dawn of his administration, President Biden called for unity and bipartisanship, saying in his inaugural address that we must put politics aside and work together to combat the pandemic. Thus far, we haven’t seen his administration, or his party, live up to that call. The American Rescue Plan was the perfect opportunity for President Biden to set the tone of the next four years by leading the way on a bipartisan deal. Instead, the Democrats have chosen to reject compromise and use budgetary reconciliation to pass an incredibly costly, untargeted, and occasionally unnecessary bill without the input of their GOP colleagues. The administration’s failure to work with willing Republicans on this package is an unfortunate sign of the partisan games and agenda-pushing we can expect for the next 4 years — all cloaked in empty calls for “unity” from a President who is unwilling to make even the simplest steps toward “uniting”.