Trump signs $484 billion package to rescue small businesses

WASHINGTON -- President Donald Trump on Friday signed a $484 billion spending package that includes more money for small businesses, the latest bid by Washington lawmakers to rescue an economy devastated by the coronavirus pandemic.

“Great for small businesses, great for workers,” Trump said in the Oval Office. “This is a tremendous victory.”

The new law would revive a small-business loan program that ran out of money after being overwhelmed by demand, deliver tens of billions of dollars in aid to health-care providers and provide $25 billion to expand U.S. testing for infection by the virus. An enduring shortage of testing has hamstrung the government’s response and become a point of tension between Trump and U.S. governors.

Several trade groups, including the National Automobile Dealers Association and the American International Automobile Dealers Association, advocated more funding for the small-business program and sent a letter to Congress last week asking it to “act expeditiously” to assure the program has the resources it needs to help the country’s small-business economy through the COVID-19 pandemic.

Highlighting the depth of the economic collapse, lawmakers are already discussing the next phase of virus rescue legislation. The Labor Department reported Thursday that another 4.4 million people filed for unemployment last week, bringing the total since March 14 to 26.5 million.

But no further action is expected until at least next month, with Republicans and Democrats divided over how much more aid to provide and where it should go. Congress is not scheduled to be in session until May 4.

The newest measure is the fourth coronavirus-related spending package since early March, totaling almost $3 trillion -- an unprecedented amount of federal assistance that far surpasses the sums doled out following the 2008 financial crisis.

The law would would provide $320 billion to make new loans under the Paycheck Protection Program, which provides forgivable loans to small business that keep employees on the payroll for eight weeks. It sets aside $30 billion of the loans for banks and credit unions with $10 billion to $50 billion in assets, and another $30 billion for even smaller institutions.

The measure also includes $60 billion in loans and grants under a separate Economic Injury Disaster Loan program, and makes farms and ranches eligible for the loans. Hospitals could receive $75 billion, with a significant portion aimed at those in rural areas.

Debate over the next round of stimulus has centered on whether states should a federal bailout. Several states that were already struggling with high public employee pension costs are facing even greater budget crunches due to the pandemic response.

Governors from both political parties and congressional Democrats have demanded that state aid be included in a future assistance package, but Republicans in Congress have balked. Senate Majority Leader Mitch McConnell this week suggested that states should pursue bankruptcy protection rather than receive federal bailout funds.

“I would certainly be in favor of allowing states to use the bankruptcy route,” McConnell said Wednesday on the syndicated Hugh Hewitt radio show. “It’s saved some cities, and there’s no good reason for it not to be available.”

Hewitt had pointed out that blue states such as California, Illinois and Connecticut had given too much to public employee unions and therefore should not get federal rescue money.

Trump told reporters on Thursday he had spoken to McConnell, senators and governors about what states should receive, adding that “if we can help states, we’re always going to help states.”

But he also agreed with the notion that some Democrat-run states already faced budget problems before the virus hit.

“It is interesting that the states that are in trouble do happen to be blue. It is interesting, you know, if you look around. I mean, the states that seem to have the problem happen to be Democrat,” he said.

New York Gov. Andrew Cuomo, a Democrat, called McConnell’s suggestion “vicious” and “dumb.” Rep. Peter King, a Repubican from New York, said letting states go bankrupt would be “shameful and indefensible.”

The latest rescue package passed the House on Thursday with an overwhelmingly bipartisan 338-5 vote, albeit under unusual circumstances. Lawmakers wore masks while casting their votes and entered the House chamber in small groups in order to maintain social distancing precautions.

The Senate approved the measure unanimously on Tuesday after a week of debate between Republicans and Democrats over the size and scope of the package.