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Georgia’s Senate race could decide fate of $ 3.4 trillion stimulus plan

  • The form and size of the stimulus plan is on the line in the runoff in Georgia on January 5.
  • “It’s all over,” policy expert Heidi Schirholz said in an interview.
  • A slim Democratic majority in the Senate could use legislative maneuver to pass a $ 3.4 trillion coronavirus aid plan without Republican votes.
  • Visit the Business Insider homepage for more stories.

President-elect Joe Biden is set to take office on January 20, but the balance of power in Washington is still unresolved with a pair of runoff in Georgia’s Senate just two weeks before Biden takes office.

In a race, Democrat John Ossoff challenged Republican Sen. David Purdue, while Republican Sen. Kelly Löfler faced Democrat Rafael Warnock in the second runoff. The results will determine which party controls the Senate in an emergency of public health and economic challenges ̵

1; and how many federal dollars are pumped into the economy early next year.

The scope of another economic aid package in the vote, while Georgians voted on January 5th. Democrats and most Republicans agree that one is needed, but they have been grappling for months over its size and the level of federal support needed to help economic recovery many economists say is weakening. Unemployment claims were filed last week for the first time since early October.

Neither side has moved since Biden defeated President Donald Trump in the Nov. 3 election, and the gap between the two parties can only widen in the lame session. The president-elect this week praised the extensive Heroes Act passed by the House in May, although Republicans rejected it for months as a progressive wish list.

Democrats are now pinning their hopes of winning both races in the state and winning an indifferent majority, leaving newly elected Vice President Kamala Harris to vote by a split. In this scenario, Democrats could use legislative maneuver to adopt pandemic mitigation measures and other tax and expenditure measures by a simple majority and without HV votes.

“Everything is stimulating,” Heidi Schirholz, political director of the left-wing Institute for Economic Policy, told Business Insider. “It’s all because if there is a Senate controlled by Democrats, they will be able to get a huge package through reconciliation.”

She continued: “Without that, it will be up to the Republicans in the Senate what the relief package looks like, if there is one. They have given a lot of signals about where they are.”

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The GOP supports a much smaller relief plan than the $ 3.4 trillion package Democrats and Biden are seeking. Republicans continue to push for a $ 500 billion thinner measure, which was introduced twice in September and October, despite a recent rise in viruses across the country, prompting states to reinstate restrictions and close businesses.

Osof recently scolded Perdue for supporting the plan, which would reduce federal unemployment benefits from the previous $ 600 a week to $ 300 and miss direct payments.

“Senator David Purdue is fighting incentives to screen workers for $ 1,200 and is leading the fight to reduce unemployment insurance while giving billions to his corporate donors,” Osoff tweeted earlier this month. He had previously expressed support for many provisions of Democratic law, including a moratorium on evictions and assistance to troubled state and local governments.

Democrats supported decisive federal action throughout the pandemic, especially progressive ones.

“Can we get people to check mortgage incentives and reliefs and rent forgiveness and support for small business and free tests and pay for hazards and health care for the uninsured (and uninsured) in the middle of a pandemic, or is that too socialist?” Democrat Alexandria Ocasio-Cortes said on Twitter last week.

Yet, regardless of the outcome of the hotly contested race, Democrats may be forced to reduce their ambitions. Elizabeth Pancotti, senior policy adviser for the nonprofit Employment America, told Business Insider that Democrats may need to take care of the “middle ground, Conservative Democrats” by cutting the cost of legislation to ease the pandemic next year.

“If Georgia goes to the Democrats, I think there will still be concessions because there will only be 50 votes,” she said. “If they lose Georgia, I think there are really expensive line items off the table, like the $ 600 federal unemployment benefit. Where there would be a round or two of [stimulus] inspections, the phasing out may be lower. “

Biden campaigned for higher taxes on wealthy people and businesses, a program that Republicans would effectively block if they held on to the Senate.

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