May 15, 2020
The $3 trillion HEROES Act is expected to pass the House Friday evening. It is dead on arrival in the Senate, but many of the policy proposals could return in a compromise bill this summer.
Three buckets: Most of the provisions in Speaker Nancy Pelosi’s (D-CA) 1,800-page bill can be divided into three categories.
In addition to the health care measures described in a separate story, the labor and workplace measures in the bill include:
In the executive compensation space, the ability to offset operating losses against prior year’s income provided for in the CARES Act would be cut off if a company has “excessive” compensation, stock buybacks, or dividends. Many companies will have some losses from this crisis. This provision incentivizes companies to lower their tax burden and cut pay or explain to shareholders why returns are not being maximized.
Everyone’s a critic: As soon as the bill was released, Republicans dismissed the length and cost of the bill and downplayed the need for another relief package at this time. "That will not pass. It's not going to be supported," said Sen. John Barrasso, a member of the Republican leadership. A few moderate Democrats, including Rep. Abigail Spanberger, (D-VA) voiced opposition.
At the same time, the most progressive wing of the Democratic caucus said the bill was insufficient. The bill’s passage later today depends on this group. Congresswoman Rashida Tlaib (D-MI ) and others, including former presidential candidate Senator Kamala Harris (D-CA), called for monthly cash payments to individuals.
The skinny: This bill is not going anywhere. Senate Majority Leader Mitch McConnell (R-KY) wants a more narrowly targeted approach and will not take any action on another COVID-19 bill until after the Memorial Day recess. The Democrats have clearly outlined not only what they want in the next virus-related legislation, but also the $3 trillion in spending they would like to execute if they control the Senate and the White House next year.