More than a Shot in the Arm: The Need for Additional COVID-19 Stimulus... (EventID=111142)

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Connect with the House Financial Services Committee Get the latest news: https://financialservices.house.gov/ Follow us on Facebook: https://www.facebook.com/HouseFinancialCmte Follow us on Twitter: https://twitter.com/FSCDems ___________________________________ On Thursday, February 4, 2021, from 10:00 a.m. (ET) full Committee Chairwoman Waters and Ranking Member McHenry will host a virtual hearing entitled, “More than a Shot in the Arm: The Need for Additional COVID-19 Stimulus." ___________________________________ Witnesses for this one-panel hearing will be: • Clarence Anthony, CEO and Executive Director, National League of Cities • Derrick Johnson, President and CEO, National Association for the Advancement of Colored People (NAACP) • Janet Murguía, President and CEO, UnidosUS • William Spriggs, Chief Economist, The American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) • Dr. Michael Strain, Economist, American Enterprise Institute ___________________________________ Overview As of February 1, 2021, the coronavirus disease 2019 (COVID-19) pandemic has caused over 102 million infections and over 2.2 million deaths worldwide, with more than 25.8 million infections and 436,000 deaths in the United States alone. The daily mortality rates for COVID-19 since mid-November 2020 make it the leading cause of death in the United States. The COVID-19 pandemic has disproportionally affected low-income communities and people of color. For example, in substantially non-white counties that have a high rate of poverty, residents have a nine times greater chance of death from COVID-19 than in mostly white, similar-income counties. COVID-19 has also taken a substantial economic toll. The national unemployment rate peaked at 14.7% in April 2020 when 20.5 million people in the United States lost their jobs. The unemployment rate in the United States remains at 6.7%, significantly higher than the 3.5% pre-pandemic unemployment rate. Real gross domestic product (GDP) for the third quarter of 2020 is 3.4% below the level of real GDP for the fourth quarter of 2019, the most recent quarter before the onset of the pandemic. The Response and Relief Act The Coronavirus Response and Relief Supplemental Appropriations Act, 2021 (Response and Relief Act), which passed Congress as part of the 2021 Consolidated Appropriations Act, became law on December 27, 2020.7 The Response and Relief Act supplemented the stimulus and relief provisions in previous COVID-19-related legislation. Among other economic relief, the Response and Relief Act provided $25 billion in emergency rental assistance, extended the Centers for Disease Control and Prevention (CDC) eviction moratorium through January 31, 2021, and provided $600 in direct economic stimulus payments to eligible individuals. Additionally, the legislation amended the Paycheck Protection Program (PPP) by making business expenses paid with the loans tax deductible, increasing the number of forgivable uses of PPP loans, simplifying the process for receiving loan forgiveness for loans of $150,000 or less, and requiring demographic reporting for loan recipients to better track diversity data. The Response and Relief Act also established a $9 billion capital facility for minority depository institutions and community development financial institutions (CDFIs), in addition to $3 billion for the CDFI fund; augmented healthcare, nutrition, and transportation programs; and expanded broadband internet access. CARES Act Stimulus Programs The CARES Act appropriated $500 billion to Treasury’s Economic Stabilization Fund, of which up to $25 billion was available to passenger airlines, up to $4 billion to cargo airlines, and up to $17 billion to businesses critical to maintaining national security. As of November 9, Treasury had approved over $28.2 billion to 610 applicants in the aviation industry. Despite support provided in the CARES Act, the aviation industry continues to struggle with over 123,000 airline workers losing their jobs since February 2020.9 The remainder appropriated to the Fund — approximately $454 billion — was made available to support Federal Reserve lending facilities such as the Main Street Lending Program (MSLP) and Municipal Liquidity Facility (MLF). On November 19, former Treasury Secretary Mnuchin wrote to the Fed requesting the return of any unused portion of funds committed to the Fed’s facilities, and on November 20, the Fed Chair agreed. Data from the Fed indicates that approximately $138 billion in unused funding from emergency lending facilities was returned to Treasury at the end of December. The Response and Relief Act eliminated the CARES Act facilities and what remained of the $454 billion appropriation, although the Fed and Treasury retained the authority to set up emergency lending facilities, so long as they are not identical to.... Hearing page: https://financialservices.house.gov/calendar/eventsingle.aspx?EventID=407097