Brown on Business
October 12-18, 2020
COVID-19 and 2020 introducing new words, phrases into American life
By Wesley Brown
With less than three months left in this crazy year that is 2020, Americans have almost created a new language to deal with the strange virtual, distant and masked society that we have been forced to live.
In the past few months, new and former unfamiliar words that were unknown or silent a year ago are now part of our everyday lives. For example, words, phrases and acronyms that are now part of our daily language include COVID-19, Zoom, BLM, PPP, QAnon, social distancing, new normal, PPE, pandemic, quarantine, lockdown, flattening the curve, and super-spreader.
But there is one 2020 acronym that hopefully will soon be put on the shelf, only to be replaced by another one that is just as cynical. For those who do not know, the CARES Act is an acronym for the $2.2 trillion omnibus Coronavirus, Aid, Relief and Economic Security Act.
Obviously, Congress lawmakers and staffers often come up with cute acronyms that serve as an explainer or headline for the actual legislation that is being considered or eventually approved by the U.S. House and Senate and then signed into law. Since the U.S. became nation, lawmakers have often used interesting titles and names for their bills.
For example, the landmark reform legislation that came out of the Great Recession was the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, named after the two Democratic congressional that sponsored the bill. Today, it is known by its more familiar and shortened moniker, the Dodd-Frank Act.
In that same year, probably the nation’s most famous bill was passed as the centerpiece legislation of former President Barack Obama’s administration. Today, the Affordable Care Act (ACA) is formally known as the Patient Protection and Affordable Care Act, and commonly known as Obamacare. Interestingly, Republicans seeking to dismantle this historic act have introduced several counter bills, including the Revoke Excessive Policies that Encroach on American Liberties Act, or REPEAL. It failed to get out of committee in 2011.
The 880-page CARES Act was overwhelmingly approved by Congress and signed into law by President Donald Trump on March 27. The $2.2 trillion omnibus bill handed out at least $1200 to most American families making less than $75,000 annually. That legislation also included the popular $670 billion Paycheck Protection Program (PPP) that gave business owners forgivable loans to keep workers on payroll after the pandemic shut down the economy in the spring.
Besides the direct assistance payments, the COVID-19 emergency relief bill also includes more than hundreds of billions of dollars in CARES Act funding that was funneled to states and local government through the various federal agencies such as the Departments of Health and Human Services, Education and Housing and Urban Development (HUD).
The federal rescue package also included $150 billion in direct payments to each state that can only be used for COVID-19 related programs and expenses and must be spent by the end of Dec. 31, 2020. In March, Gov. Asa Hutchinson created a 15-person task force, known of course as the CARES Act Steering Committee, to identify the needs of the state and make recommendations for the best use of federal stimulus funds.
Some states that have large budget deficits have held onto to their CARES Act allotments after U.S. commerce essentially halted in the spring after COVID-19 was declared a global pandemic, leading to stay-at-home and social distance orders across the U.S. Those states, including Rhode Island, Tennessee, Texas and Florida, and meting out those funds slowly in hopes that Congress will pass new legislation giving them leeway to plug COVID-19 budget holes.
But not Arkansas. To date, the panel of state lawmakers and top policymakers has approved more than $$420 million of the state’s $1.25 billion allotment from the federal emergency relief package. The most controversial has been the state’s Ready for Business Grant program that was unveiled in late April by the Arkansas Economic Development Commission and saw funds run out within a few hours.
According to AEDC, which is now part of the state Department of Commerce, the COVID-19 grant program received over 2300 successful application within an hour after the program was launched. Due to overwhelming demand during the program rollout, AEDC quickly revised the allocation of funds among qualified applicants in order to provide assistance to more Arkansas businesses.
After new rules were written before the second launch of the program, about 75% of the funding went to businesses with less than 50 employees and another 15% of the recipients has meted out to minority and women owned businesses. Altogether, the state has allocated nearly $148 million in grants through that now expired program.
At the Sept. 25 meeting of the governor’s steering committee, the panel approved a $165 million request from the state Commerce Department’s Division of Workforce Services to shore up the state’s dwindling Unemployment Trust Fund due to the increase in benefits being paid out due to the COVID-19 pandemic.
At the Oct. 6 meeting called by the governor, the agenda includes another $70 million in funding demands, including a $50 million funding for suicide prevention, health and other activities to support veterans’ issues during the pandemic. That CARES Act funding request by Sen. Trent Garner, R-Camden, if approved by the steering committee, would be placed with the state Department of Veterans Affairs and nonprofit organizations that assist Arkansas veterans.
Even if that funding is approved, the Arkansas task force would still have more than $700 million in CARES Act funding on hand. But if President Donald Trump gets his way, Americans will have to learn another COVID-19-related acronym tied to a second COVID-19 relief package that could be even larger than the first one.
In May, House Democrats approved the so-called Health and Economic Recovery Omnibus Emergency Solutions Act, or the HEROES Act, an 1800-page coronavirus relief bill that extends the $600 per week unemployment insurance supplement through Jan. 31, 2021. That bill also allows the supplement to continue through March 31, 2021 for those who have not exhausted their benefits.
The House bill backed by Democrats among other things, also approves additional funding for voter protections for the upcoming 2020 presidential election, $25 billion for the U.S. Postal Service, and additional food stamp spending.
On the other hand, Republicans are proposing a smaller $1 trillion bill known as the Health, Economic Assistance, Liability Protection and Schools Act, or HEALS Act, penned by U.S. Senate Majority Leader Mitch McConnell. That legislation would cut unemployment benefits to $200 per week until states can implement a 70% wage replacement program.
More recently, the House passed a thinner version of the HEROES Act that is $1.2 trillion less than the original bill. As of Oct. 7, U.S. House Speaker Nancy Pelosi is talks with U.S. Treasury Secretary Steve Mnuchin and Senate leaders on that could send a second round of stimulus dollars into Arkansas and other states before the Nov. 3 presidential election. With nearly all 50 states experiencing a rise in new COVID-19 cases, the hope is that the new influx of cash will keep the economy afloat until a coronavirus vaccine or cure is found.
If both the current House and Senate versions of the new emergency relief package are approved, negotiators will also have to come together to resolve key differences between the competing bills. That also means choosing between two new acronyms that will make U.S. lawmakers either HEROES or HEALS.