Apr 3, 2020 - Politics & Policy

Lawmakers worry about coronavirus stimulus rollout

Photo: Mandel Ngan/AFP via Getty Images

Congress passed a $2.2 trillion stimulus bill to help struggling Americans and businesses hit hard by the coronavirus. Now, lawmakers on both sides of the aisle worry the agencies responsible for delivering the aid may not be ready for the task.

Why it matters: People are desperate for federal help to dig them out of the economic hardship brought on by the pandemic.

  • But lawmakers and staff who helped draft the rescue package have privately expressed concerns that the Trump administration — particularly the Small Business Administration and Labor Department — may be overwhelmed by the demand for loans and unable to get checks out the door as fast and responsibly as they're needed.
  • Some fear a repeat of what happened with the botched rollout of the Affordable Care Act in 2013 when the site crashed due to tremendous demand.

What we're hearing: "Senators are nervous. They set up these massive programs, and they're proud of the programs that they set up, but they're nervous," a Senate GOP aide tells Axios.

  • Small businesses and those seeking unemployment insurance (6.6 million Americans filed for unemployment last week alone) are the two areas where Americans need the emergency money immediately.
  • The $349 billion relief program for small business kicks off today, and Hill aides say it'll be a test of whether the SBA can handle the mounting loan requests.
  • The day before the program’s launch, many banks and lenders tasked with funding the loans and approving applicants — including JP Morgan, the biggest U.S. bank — said they still didn't have the necessary information to participate on time.
  • "It's gonna be a complete disaster, I'm sure, when the phone lines are jammed or the websites aren't working," one Senate Democratic aide said.

The White House, Treasury Department and Small Business Administration did not respond to requests for comment.

State of play: Republican and Democratic lawmakers continue to talk regularly with the White House and Treasury Secretary Steven Mnuchin following last week's passage of the CARES Act, and have voiced their concerns about the implementation of the bill.

  • Senate Minority Leader Chuck Schumer (D-N.Y.) has spent "a lot of time calling Mnuchin, calling Trump, calling Cabinet officials, saying, 'You need to make sure that X, Y, and Z is happening,'" a person close to Schumer tells Axios.
  • Sen. Mark Warner (D-Va.) has raised concerns with Mnuchin that the SBA could soon be stripped of its resources, given the broad eligibility and the generosity of the small business program, a policy aide to Warner told Axios. "It's also questionable whether the SBA can scale up a program that’s this big."
  • Warner told Mnuchin they'll likely have to pump more money into the SBA if the program is successful, the aide said, and the administration suggested they would be willing to work to expand the program down the line.
  • Mnuchin told reporters this week that he would ask Congress for more funding if the money runs out.

What’s next: Washington leaders expect to have a good idea in the next two weeks about whether the stimulus programs are successful, a Trump administration official said. Lawmakers and policy aides say they'll closely monitor how these programs are being used to see what needs to be fixed or whether certain areas need to be expanded.

  • Changes could come in the form of amendments or a supplemental bill.
  • Speaker Nancy Pelosi has been preparing the House of Representatives for a sweeping Phase 4 stimulus package, but most Senate aides tell Axios their first concern is making sure the CARES Act isn't a failure.
  • "We still need to stop the bleeding," a Senate Republican leadership aide told Axios. "Phase 4 is about recovery, but we're still in surgery right now. So I just think it’s premature."

Go deeper

Pelosi slams McConnell on stimulus delay: "You want a pause? Tell that to the virus"

House Speaker Nancy Pelosi lambasted Senate Majority Leader Mitch McConnell Thursday for delaying moving forward on the next coronavirus relief package.

The big picture: McConnell has said for weeks that Congress should wait until it has assessed the impact of the $2 trillion CARES Act passed in March.

The economy's honeymoon phase of its coronavirus recovery

Illustration: Aïda Amer/Axios

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What's happening: The Fed's latest Beige Book, a survey of business leaders around the U.S., was released Wednesday and revealed that for firms in each of the Fed's 12 districts, "the outlook remained highly uncertain and most contacts were pessimistic about the potential pace of recovery."

Updated May 28, 2020 - Health

Pennsylvania Sen. Casey calls for action plan to contain coronavirus infections in nursing homes

Screenshot: Axios

The federal government needs to provide more oversight when it comes to monitoring nursing homes during the coronavirus pandemic, Sen. Robert Casey (D-Pa.) told Axios' Mike Allen on Thursday during an Axios digital event.

What Casey is saying: "Tens of thousands of people are dying in nursing homes without an action plan, which has to start at the federal level — the administration and Congress doing more to combat this problem."