Senate GOP mulls forgivable loans to businesses to halt layoffs, bankruptcies

Senate GOP mulls forgivable loans to businesses to halt layoffs, bankruptcies
© Greg Nash

Sen. Marco RubioMarco Antonio RubioTrump seeks to sell public on his coronavirus response Rubio knocks coverage of US coronavirus cases as 'grotesque' and 'bad journalism Lessons from the front line — Florida's fight with sea level rise MORE (R-Fla.) said Tuesday that Senate Republicans are crafting a plan to provide forgivable loans to businesses derailed by the coronavirus outbreak through a $1 trillion economic rescue plan.

In a series of Thursday tweets, Rubio detailed how GOP senators plan to support companies that could be forced to lay off workers as the measures to slow the coronavirus pandemic shut down entire industries across the U.S.

Rubio said that the loans would be issued through banks, credit unions and other private-sector financial firms to help speed the process of distributing funds. If a business uses the loan to keep workers on payroll, pay their rent or handle other necessary expenses, Rubio added, they would not be forced to pay back the loan.

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The overall goal was to “Get cash to small business [as] fast & easy as possible so they don’t have to lay people off,” tweeted Rubio, who is spearheading the Senate GOP’s deliberations on business aid. “If they use it for that purpose doesn’t have to be paid back.”

President TrumpDonald John TrumpCuomo grilled by brother about running for president: 'No. no' Maxine Waters unleashes over Trump COVID-19 response: 'Stop congratulating yourself! You're a failure' Meadows resigns from Congress, heads to White House MORE and lawmakers are scrambling to get ahead of a likely flood of layoffs and business failures driven by the coronavirus pandemic and the drastic measures needed to slow its progress.

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Claims for unemployment insurance spiked by 70,000 in the week between March 8 and March 13, with numbers almost certain to soar as a rising number of restaurants, bars, entertainment venues, hotels and other businesses are forced to close or limit service for weeks, if not months.

“There are a lot of enterprises that are hurting right now, and they’re going to start laying off people unless we get some money to them,” said Sen. Mitt RomneyWillard (Mitt) Mitt RomneyGranting cash payments is a conservative principle 7 things to know about the coronavirus stimulus package Scarborough rips Trump for mocking Romney's negative coronavirus test: 'Could have been a death sentence' MORE (R-Utah) on the “The Hugh Hewitt Show” Thursday. “We’d rather have the employers paying those people than have them show up to the unemployment office.”

The Trump administration and lawmakers are also seeking ways to help workers who’ve already been laid off or may be forced to miss work if they or a loved one contracts the coronavirus.

Trump on Wednesday signed a bill negotiated by House Speaker Nancy PelosiNancy PelosiMeadows resigns from Congress, heads to White House Pelosi floats undoing SALT deduction cap in next coronavirus bill Overnight Health Care: More states order residents to stay at home | Trump looks to sell public on coronavirus response | Judges block Ohio, Texas abortion bans | Dems eye infrastructure in next relief bill MORE (D-Calif.) and Treasury Secretary Steven MnuchinSteven Terner MnuchinUS extends waivers on Iran sanctions amid coronavirus pandemic On The Money: Democrats eye infrastructure in next coronavirus package | Mnuchin touts online system to speed up relief checks | Stocks jump despite more stay-at-home orders Schumer praises choice of Defense inspector general to oversee corporate lending fund MORE to bolster unemployment insurance, paid sick leave and provide free coronavirus testing. 

Mnuchin also told Fox Business Network that the administration is proposing to send every U.S. household $1,000 for each adult and $500 for each child within three weeks of the stimulus bill passing with another round to come six weeks later if the economy is unable to rebound.

Lawmakers in both parties support emergency direct payments to U.S. households, which were deployed by former President George W. Bush during the 2001 and 2008 recessions. 

The proposals differ greatly from the universal basic income plans supported by a slew of progressives, including former Democratic presidential candidate Andrew YangAndrew YangMajority of young Americans support universal basic income, public healthcare: poll Granting cash payments is a conservative principle Solving the coronavirus economic downturn — good psychology makes for good politics and policy MORE, that would provide each U.S. adult with a steady, monthly income regardless of the state of the economy.

Jordain Carney contributed.