The United States’ economic rescue plan in the face of the global coronavirus crisis, an unprecedented package that can reach two trillion dollars, continues to be negotiated against the clock in Congress in a scenario of increasing anxiety in the financial markets and in the so-called real economy. Republicans and Democrats disagree on various points of the program with which to contain the ravages of the self-imposed economic slowdown, with already one in three US citizens subject to the order to stay home. At around two in the afternoon (local time), a second procedural vote failed due to the Democratic rejection.
The pandemic It is advancing in the United States at a rate that seems as unstoppable as it has been in the other most affected countries, China, Italy, or Spain. With more than 35,000 infected, twice as many as the weekend, and nearly 500 dead, the confinement orders, more or less harsh, have already been imposed in a dozen of the most populous states. The cessation of associated economic activity, consumption, and life, in short, is so abrupt, so incomparable with previous recessions, that the nation has panicked over the coming economic debacle.
Democratic minority leader in the Senate Chuck Schumer said he would continue negotiations and hoped to reach an agreement throughout Monday, making it clear that the procedural vote that was about to take place was doomed to failure. what failure the one on Sunday night. The plan requires the support of 60 of the 100 senators, and the result was 47-47 due to the Democratic rejection. The Republican-designed bill, Schumer admitted, had already incorporated some improvements proposed by the opposition, but still did not offer enough guarantees for the protection of employees of the rescued companies. “Workers first,” he stressed, is the philosophy of the rescue model they defend.
The program It envisages the mass mailing of checks to a large number of homes, $ 1,200 per adult and $ 500 per minor, as well as $ 350 billion in guarantees for small and medium-sized companies to help them minimize layoffs. In addition to the expansion of health coverage, one of the elements that most worries Republicans in the $ 500 billion stock market in loans to companies and states, as it is no longer distributed to the Treasury Department, on a discretionary basis. and with little transparency. In the words of Senator Elizabeth Warren, a former presidential candidate and very critical of Wall Street’s excesses, that measure would become, de facto, an “illegal fund” for companies.
Republican Majority Leader Mitch McConnell spoke out harshly against the opposition over his misgivings against the program and accused them of trying to advance their progressive policies by using it as a vehicle. “Are you kidding me?” He snapped during his pre-vote speech. “Democrats are not going to let us inject funds into hospitals or small businesses unless they manage to dust off their Green New Deal.”
This brutal global crisis unleashed by the virus has come at a time of great political polarization in the United States, less than a year before the presidential elections. This same House in which this Monday discusses the largest economic aid program in modern history is the same in which just a month and a half ago, Trump was being judged – and acquitted – in the third impeachment of the country’s history. From all that normal life embodied, turbulent though it was, it seems like an eternity has passed.
The deal between Democrats, who control the House of Representatives, and Republicans, who are majority in the Senate, is taken for granted as a last resort, but this is a race against the clock, in health and financial terms. This Monday, before the markets open, the Federal Reserve He announced that he will buy assets unlimitedly and for as long as necessary until markets stabilize. That is, free bar of credit in order that the economy does not collapse, but Wall Street seems unfazed by such an announcement. With the activity stopped, the shares of the companies burn in the hands of the investors and the titles go down in the Stock Market. The blockade of the rescue plan and the increase in movement restrictions weighed more on the minds of those who buy and sell on the Stock Exchanges.
Anxiety
The anxiety generated by this break was obvious in the message that Donald trump He wrote on his Twitter account last Sunday, around midnight. “We cannot allow the cure to be worse than the problem, at the end of the 15-day period, we will make a decision on where we should go,” wrote the US president. A mere review of the latest forecasts by the analytical cabinets helps understand fear: Morgan Stanley sees similarities to the Great Depression 80 years ago and has calculated that in the second quarter the economy may drop 30%, Goldman Sachs leaves it at 24% and JP Morgan seems even optimistic, in this regard , estimating a contraction of 14%.
Meanwhile, the difficulties continue. A Kentucky senator, Rand Paul, has tested positive for the coronavirus, and another who was in contact with Paul, Mitt Romney and Mike Lee, both from Utah, are quarantined as a precaution.
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