These Provisions Have No Place in an Emergency Bill

Mar 23, 2020 | Other Spending

Negotiators continue to work on a third response bill to the coronavirus (COVID-19) pandemic, with legislation proposed today by House Democrats and last Thursday by Senate Republicans. Both bills include important provisions to strengthen public health, aid those most affected by the crisis, support the economy, and address the current emergency. However, mixed in with these proposals are a number of changes that have little or nothing to do with the crisis at hand. In a statement yesterday, we warned policymakers: "Don't Play Politics with the Coronavirus Response." Committee for a Responsible Federal Budget president Maya MacGuineas said:

Preventing a health and economic calamity will require an unprecedented level of spending, but each dollar must still be spent wisely.... Unrelated measures that are tucked into the current bill will compromise its credibility and make it more difficult to pass future response measures as they prove necessary. This is a moment to put special interest politics aside and focus only on the emergency at hand.

Unfortunately, policymakers are seeking to include several of these unrelated measures, diverting precious dollars away from where they are needed most.

A House-proposed draft circulated today includes the following measures that would do little to address or mitigate the crisis:

  • Reduce student loan debt by $10,000 per borrower
  • Permanently expand Affordable Care Act (ACA) premium subsidies
  • Forgive all the U.S. Postal Service's debt
  • Make the Child Tax Credit (CTC) fully refundable for the next 6 years
  • Increase the size of the CTC by $1,600 for children under age 6
  • Bail out multiemployer pension plans that were failing prior to the crisis
  • Temporarily expand dependent care tax breaks

Meanwhile, the Senate-proposed bill released last Thursday includes measures to:

  • Weaken base-broadening enacted in the Tax Cuts and Jobs Act (TCJA), retroactive to 2018, including limits on interest deductibility
  • Enact unrelated technical fixes to the TCJA related to the "retail glitch" and repatriation payment refunds
  • Creating a new $300 above-the-line deduction for charitable giving in 2020

In general, these proposals will do little if anything to address the current crisis. While some are sensible policies on their own, they should be enacted through the regular legislative process and with adequate offsets. They should not be tacked on to emergency legislation, particularly if the measures are permanent or the costs come at the expense of needed emergency spending.

Our above list is not exhaustive, and readers should email us other provisions that simply don't belong. Now is not the time to play politics with a national emergency.