Bernie Sanders threatens to hold up coronavirus bill after 4 GOP senators push to cut unemployment aid

Key Points
  • The prospect of a planned Senate vote on a $2 trillion stimulus package in response to the coronavirus pandemic dimmed Wednesday as senators threatened to hold up the legislation.
  • First, four GOP senators said they could delay the bill over a core unemployment insurance provision. 
  • Then, Sen. Bernie Sanders said he would delay the bill if his Republican colleagues did not drop their opposition. 
Bernie Sanders threatens to put hold on virus bill over unemployment aid fight with GOP senators
Bernie Sanders threatens to put hold on virus bill over unemployment aid fight with GOP senators

Chances for a planned Senate vote Wednesday on a historic $2 trillion relief package in response to the coronavirus pandemic appeared to dwindle as senators threatened to delay it over a key unemployment insurance proposal.

Earlier in the day, four Republican senators — Lindsey Graham and Tim Scott of South Carolina, Ben Sasse of Nebraska and Rick Scott of Florida — threatened to oppose the chamber's push to pass the rescue package through fast-track procedures. They argued a proposal to add $600 per week to unemployment insurance for up to four months, a core provision of the near-final legislation, could encourage companies to lay off workers and Americans to stay unemployed, urging a vote to cap the aid. (Sasse introduced an amendment Wednesday night saying the benefits should not exceed previous pay). 

Sen. Bernie Sanders, I-Vt., then said he would delay the bill if his GOP colleagues did not drop their opposition, calling it an "outrage" to prevent Americans from getting emergency unemployment insurance. In a statement, he said he is "prepared to put a hold on this bill" to lobby for tighter restrictions on companies receiving aid from a taxpayer pool of $500 billion. 

The prospect of an impasse in the Senate appeared to hit U.S. stock indexes at the end of Wednesday's session, as markets closed in the green but off their highs. Investors hoped Congress could quickly approve the legislation, which gives direct payments to Americans, loans to businesses large and small, and resources to states and hospitals to fight the outbreak.

Democratic presidential candidate Senator Bernie Sanders speaks during a news conference in Burlington, Vermont, U.S. March 11, 2020.
Lucas Jackson | Reuters

Asked about the GOP senators' criticism of the unemployment plan during a White House briefing Wednesday, Treasury Secretary Steven Mnuchin said "I don't think it'll create incentives" not to work. He said state systems were not equipped to assure Americans would only get benefits equal to their previous pay, adding "this was the only way we could assure that states could get money out quickly in a fair way." 

"Our expectation is this bill passes tonight and gets to the House tomorrow," he said. 

Lawmakers rushed to put together the stimulus plan, which the Senate hopes to pass by Wednesday night after several false starts during frenzied negotiations in recent days. After Democrats blocked an earlier version of the legislation twice to try to secure concessions, Republicans accused them of delaying aid desperately needed to boost a reeling economy and health-care system.

House Majority Leader Steny Hoyer, D-Md., said Wednesday that he would give representatives 24 hours' notice before a vote on the relief package. By about 7 p.m. ET, the Senate had not released the final version of its legislation. 

House Speaker Nancy Pelosi told PBS on Wednesday that the chamber could try to pass the bill by voice vote with the vast majority of representatives still out of Washington. If a member requests a recorded vote to document individual responses, lawmakers would have to come back to the Capitol. 

First, though, the Senate has to overcome its remaining hurdles to approve the package. Pelosi criticized the GOP senators for their opposition to the legislation. 

"Please don't resent our lowest paid workers in America for getting $600," she said. 

The emergency unemployment insurance provision, a compromise reached between Democrats and Republicans, including the Trump administration, aims to help workers hit by widespread layoffs as regular businesses in the U.S. ground to a halt to slow the pandemic's spread. Earlier Wednesday, the four Republican senators said some workers would get more money from the insurance than they did from their jobs.

"Let's just make sure we make people whole. Let's not increase their salary, because you can't afford to do that," Graham told reporters. 

In response to the lawmakers' concerns, a senior GOP aide said that "we'll have to do something" to secure their support. 

Taylor Foy, a spokesman for the Senate Finance Committee, which drafted the unemployment provision, said "nothing in this bill incentivizes businesses to lay off employees, in fact it's just the opposite." He noted that the legislation aims to both make sure companies have enough money to cover payroll and create a stronger unemployment insurance program for those who lose their jobs. 

"This increase is designed to make the average worker whole. It's also important to remember that nobody who voluntarily leaves an available job is eligible for [unemployment insurance]," he said. 

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Sanders' counter threat to hold up the legislation revolves around perhaps the biggest Democratic concern that emerged from an earlier version of the bill. They worried Mnuchin would have too much discretion over how the government doled out the $500 billion in aid and how companies would use it. 

The Trump administration and Republicans agreed to add an inspector general and congressional panel to oversee the fund. However, some Democrats still worry about repeating the mistakes of the Troubled Asset Relief Program during the financial meltdown of 2008, when banks awarded executives with bonuses after receiving bailout money. 

Sanders said that if he did hold up the relief bill, he would push to "make sure that any corporation receiving financial assistance under this legislation does not lay off workers, cut wages or benefits, ship jobs overseas, or pay workers poverty wages."

— CNBC's Kayla Tausche and Lauren Hirsch contributed to this report.