This week Senate Majority Leader Mitch McConnell suggested he might be ready to pump the brakes on any future coronavirus relief packages.
“We haven’t had much discussion about adding $2.7 trillion to the national debt, and the way that could indeed also threaten the future of the country,” McConnell recently said on The Hugh Hewitt Show.
Leaders of both parties have acknowledged that more aid is needed to address the overwhelming economic fallout that’s occurred during the pandemic, but McConnell appears increasingly reluctant to approve additional stimulus at the current scale. He also suggested that bankruptcy for some states might be preferable to bailouts — a process almost all states currently cannot use.
With the likely passage of a $480 billion bill aimed at providing more funding for small businesses this week, the combined coronavirus relief will include over $2.7 trillion going toward workers, businesses, and states. These bills far surpass the roughly $1.5 trillion lawmakers approved across different bills in the wake of the 2008 financial crisis.
But the current economic crisis and public health crisis is unprecedented; more than 22 million people have filed for unemployment insurance in the span of a month.
Many economic experts note that the stimulus that’s needed will have to match the singular magnitude — and nature — of the crisis. Additionally, they emphasize that current interest rates, which are lower than they were when congressional Republicans imposed their tax cuts in 2018, reduce the cost of borrowing.
“We want massive, debt-financed disaster relief while the economy is in its medically induced coma,” economist Paul Krugman has said.
McConnell and other Republicans, including House Minority Leader Kevin McCarthy, meanwhile, have been stressing that continuing to approve stimulus packages at this rate could be detrimental to the national debt. They’ve argued that the best response to the economic downturn may not be ramping up the degree of stimulus but to reopen parts of the economy strategically.
“The best way to get the economy back [up] and running is to begin to open it up again, rather than passing immediately another bill where we have to borrow,” McConnell told Politico.
While the timing around reopening the economy is by far the largest question on pretty much everyone’s minds, doing so too soon could result in further spread of the coronavirus, which would then have even worse implications for the economy down the line. As Vox’s Ezra Klein put it, “So long as the virus is a live threat, our economies won’t recover because we won’t let them recover.”
At this point, McConnell’s statements appear to indicate that he’s less open to the same types of stimulus that Democrats are proposing in the upcoming package — something lawmakers have dubbed CARES 2. Democrats have signaled that their priorities include expanding funding for states and cities, which are under severe financial strain due to tax revenue shortfalls, and including hazard pay for frontline workers.
While Democrats have leverage of their own in both the House and the Senate, McConnell’s comments make it seem like he’ll be putting up some serious opposition.