Los Angeles Times - 13.03.2020

A8 FRIDAY, MARCH 13, 2020 SS LATIMES.COM

CORONAVIRUS

evening, adding that a vote
on the measure would take
place Friday, with or without
a deal with the White House.
Pelosi suggested the final
deal would be slimmer than
the ambitious plan Demo-
crats released Wednesday.
“We’ve resolved most of
our differences, and those
we haven’t, we’ll continue
the conversation because
there will obviously be other
bills,” she said.
A significant sticking
point was how to handle sick
pay for workers.
Democrats originally
proposed a permanent man-
date that employers provide
paid sick leave for all work-
ers nationwide, plus an addi-
tional temporary measure
to address the current need
to allow sick workers to stay
home. Republicans said the
ideas were too broad and
would take too long to imple-
ment, advocating for a nar-
rower approach.
A proposal from Presi-
dent Trump to cut payroll
taxes is not expected to be
included, as both parties in
Congress have panned it.
The bill’s future is uncer-
tain in the Senate, where Re-
publicans blasted an earlier
version. But it’s likely that if
the administration signs off
on the measure, the GOP-
controlled chamber will ap-
prove it. Most senators went
home on Thursday while
talks were still underway.
Even if the House passes
a bill Friday, the Senate is
unlikely to do anything fur-
ther before Monday.
The starting point of the
talks was a House-drafted
bill that Republicans said
was too expansive. They said
it enacted a permanent paid
sick leave program that
would burden businesses.
Mnuchin, negotiating on
behalf of the Trump admin-
istration with the backing of
congressional Republicans,
proposed tax credits for
small- and mid-sized busi-
nesses to ease the burden of
providing time off, according
to congressional sources.
Leaders in both parties
felt pressure to act quickly as
more companies sent work-
ers home, schools closed,
theaters went dark and
sports venues canceled
events to stem the spread of
the virus. And the stock
market continued to crater.

Earlier Thursday, Minor-

ity Leader Kevin McCarthy

(R-Bakersfield) predicted

that a deal could come to-

gether in a day or two. Pelosi

said she was open to Repub-

lican changes, but suggested

she wouldn’t delay the bill’s

passage for that long.

“Everybody could have a

complaint about this or that.

I say, save it for another day,”

Pelosi said. “Right now, we

have to find our common

ground, work together, to

get this done as soon as pos-

sible.”

Senate Republicans have

so far left negotiations to

Pelosi and Mnuchin.

The House Democrats’

original proposal required

employers to give workers

up to seven days of paid sick

leave based on their hours,

with an additional 14 days

during a public health crisis,

such as the coronavirus out-

break. While all employers

would have to cover the first

seven days of sick pay, busi-

nesses with 50 or fewer em-

ployees could be reimbursed

by the federal government

for the additional 14 days.

The proposal would rep-

resent a major expansion of

paid leave. Only about a doz-

en states mandate paid sick

leave now. California in 2014

became the second state in

the country to do so.

To address the short-

term need while employers

adjust to the new sick leave

requirements, the original

version also provided Social

Security Administration

funding for workers who

don’t currently receive sick

pay and need to stay home

because they have the dis-

ease or need to care for

someone who does. People

would be eligible to receive

benefits amounting to two-

thirds of their monthly earn-

ings, up to $4,000.

The original bill also pro-

vided $1 billion in emergency

grants to states to process

unemployment benefits and

nearly $1 billion for food pro-

grams, including help for

food banks and funding for

programs for pregnant wo-

men, children and seniors.

Republicans were critical

of Democrats’ proposal to

have the Social Security Ad-

ministration to administer a

paid sick leave program, ar-

guing that it would take six

months to start distributing

checks and hinder other So-

cial Security work. They also

don’t like the enactment of

mandatory paid sick leave

for all businesses.

“If we put out some new

thing, it usually takes the

government six months to 18

months to implement some-

thing,” said Sen. Martha Mc-

Sally (R-Ariz.). “So let’s look

at existing mechanisms and

see how we can provide that

relief in a way that’s support-

ing small businesses and

families that are impacted

right now.”

Republicans also had

some demands. They want-

ed to prohibit federal dollars

in the bill from being used to

cover most abortions, a pro-

vision unlikely to get Demo-

cratic support. They also

wanted to lift an Obamacare

ban on using Health Savings

Accounts for over-the-

counter medicines, to give

manufacturers protection

from liability to encourage

the production of masks,

and to tap a disaster unem-

ployment assistance fund.

McConnell trashed the

bill Democrats wrote. “In-

stead of focusing on immedi-

ate relief to affected individ-

uals, families and busi-

nesses, the House Demo-

crats chose to wander into

various areas of policy that

are barely related, if at all, to

the issue before us.” He

called the bill a “needless

thicket of new bureaucracy.”

Even as negotiations

took place, Trump criticized

Pelosi for resisting his pro-

posal for a cut to payroll

taxes. A payroll tax holiday

has little support in either

party, with Republicans

considering it too expensive

and Democrats saying that

it doesn’t target relief at the

workers most likely to be

hurt if the economy slips

into a recession.

And despite his call

Wednesday night for an end

to partisan bickering, he

retweeted an old criticism of

Senate Minority Leader

Charles E. Schumer (D-

N.Y.) for his controversial

comments on the Supreme

Court.

Times staff writer Chris

Megerian in Washington

contributed to this report.

Parties close to COVID-19 aid deal

ANTHONY FAUCI,head of the National Institute of Allergy and Infectious Diseases, takes questions from reporters Thursday. He told

the House Oversight Committee that “getting [tested] easily, the way people in other countries are doing it — we’re not set up for that.”

Brendan SmialowskiAFP/Getty Images

[Stimulus,from A1]

proposal to suspend the
payroll (Social Security) tax
even as key members of Con-
gress remained skeptical
about its multibillion-dollar
cost and scant prospects of
turning things around
quickly.
For an employee making
$25,000 a year, the deduction
hiatus would leave an extra
$60 in take-home pay every
two weeks.
That is no solace to those
in the gig economy who are
not covered by the payroll
tax or those outside the la-
bor force, including the
elderly. Any temporary tax
savings is easily erased by
furloughs and cuts in hours
tied to economic disrup-
tions, which now include a
drop in demand for goods
and services atop the early
disruptions in supply from
countries such as China.
New victims include the
ushers, ticket takers, jani-
tors and food service work-
ers in Southern California
sports venues, including
Dodger Stadium, Angel Sta-
dium, Staples Center, Banc
of California Stadium, Dig-
nity Health Sports Park and
Honda Center. Major
League Baseball pushed
back the season opener by at
least two weeks, while the
National Basketball Assn.,
the National Hockey League
and Major League Soccer
suspended their games in-
definitely.
Disneyland Park and
Disney California Adventure
likewise will close until the
end of the month, though
Disney Co. said it would con-
tinue to pay its 30,000 work-
ers at the Anaheim resort.
Talks of workforce reduc-
tions, including buyouts, al-
ready are underway for
transportation companies
affected by Trump’s
Wednesday night announce-
ment that he would suspend
travel from 26 European
countries. At least one for-

eign carrier has announced

plans to lay off workers.

“I am concerned that this

is more far-reaching than

9/1 1,” said Lori Bassani, pres-

ident of the union that repre-

sents American Airlines

flight attendants. After

those attacks two decades

ago, flights were halted

nationwide for three days.

Americans’ reluctance to fly

lasted months. The drop in

demand resulted in heavy

losses to airlines.

Airline stocks were hit

hard Thursday — Spirit Air-

lines suffered a nearly 33%

drop while the parent of

United Airlines shed 25%.

Princess Cruises, a sub-

sidiary of Carnival Corp., an-

nounced Thursday morning

that it was suspending oper-

ations for 60 days. The move

came after 21 people on its

Grand Princess ship tested

positive for the virus, trig-

gering delays and quaran-

tines for thousands. Viking

Cruises likewise said it was

suspending operations until

May 1.

Princess did not say

whether it would continue to

pay salaries to the 35,000 em-

ployees of its 18 ships during

the 60-day stoppage. Viking

also did not reveal salary

plans for its 10,000 employ-

ees tending its 70 vessels.

The announcements

drove cruise company

stocks down sharply — Nor-

wegian, Royal Caribbean

and Carnival stocks each

shed more than 30%.

A proposed extension of

the April 15 deadline for tax

returns, floated by Treasury

Secretary Steven T.

Mnuchin, would at best

postpone the pain for work-

ers and companies owing

the federal government.

With 80% of those owing in-

come tax making more than

$100,000 a year, according to

Oxford Economics, it’s

hardly those earning ticket-

taker’s pay who might bene-

fit.

Democrats led by House

Speaker Nancy Pelosi have

proposed paid sick leave to

cover a 14-day quarantine as

well as increased food aid,

more unemployment insur-

ance and free medical test-

ing. Those ideas face push-

back from Republicans,

raising the possibility that

Congress will recess before

passing a relief bill.

Late Thursday, Pelosi

vowed to bring a bill to the

floor despite criticism from

House Minority Leader Kev-

in McCarthy (R-Bakers-

field) that the measure

“comes up short.” He said

Congress may postpone a

recess by 24 to 48 hours.

The Democrats’ plan

would cover two-thirds of

salary for workers at compa-

nies that don’t provide the

benefit. Businesses that

would have to foot the bill for

paid leave could be compen-

sated with tax credits, a

move welcomed by Holly

Wade, director of research

and policy analysis at the

National Federation of Inde-

pendent Business, the lead-

ing small-business lobby.

The Trump administra-

tion appears more focused

on the stock market num-

bers and on businesses most

affected by the economic

slowdown, such as trans-

portation services, which

will suffer from Trump’s

newly announced travel ban,

set to go into effect Saturday

morning. U.S. energy firms

appear to be candidates as

well, amid an ongoing oil

price war between Saudi

Arabia and Russia.

Trump was quick to bail

out agriculture during the

trade war with China but

has vacillated on what he

would have done during the

Great Recession when the

auto industry was bailed out

by the federal government.

“Bailing out specific com-

panies should only happen if

failure of those companies

can’t be handled using the

bankruptcy system and

their failure would do seri-

ous damage to the broader

economy,” said Mark Zandi,

chief economist at Moody’s

Analytics. “Providing finan-

cial support to specific in-

dustries and companies

should be the last thing on

the list of fiscal stimulus

measures.”

Trump said he planned

to ask Congress for $50 bil-

lion more for the Small Busi-

ness Administration so it

could offer low-interest

loans to smaller firms.

But surveys of small busi-

nesses show access to credit

isn’t a problem for most of

them right now, so it’s un-

clear how much help such a

measure could bring.

Times staff writers

Laurence Darmiento, Hugo

Martín and James F. Peltz

contributed to this report,

as well as Times wire

services.

Coronavirus fears drive stocks to a dismal close

SOME TRADERS took the sharp sell-off as validation of an ongoing hunch that the stock market was over-

valued, said René Nourse, a CNBC commentator: “When the coronavirus happened, it kicked the door down.”

Bryan R. SmithAFP/Getty Images

[Markets,from A1]