Make Growth and Medical Independence from China Priorities in the Stimulus Package
Following the largest emergency aid package in American history, Congress is working to craft a smaller, more targeted follow-on package to help accelerate a return to healthy lives and a healthy economy.
The May and June monthly jobs reports smashed expectations, but the U.S. faces immediate economic headwinds from COVID flare-ups, extended lockdowns by Democratic governors and mayors, looting and violence in major cities, and uncertainty about the economic recovery.
In contrast to the $3 trillion liberal grab bag rammed through the House by Democrats, Senate Republicans are countering with the HEALS Act (the Health, Economic Assistance, Liability Protection and Schools Act), unveiled last week at an estimated cost of $1 trillion.
The proposal includes more targeted funding — including for testing, telehealth expansion, and new flexibility for workers’ health savings accounts. It also allows state and local governments to use up to 25 percent of their federal COVID relief for lost tax revenues if they comply with Congress’s original intent of sharing relief funds with smaller cities and rural communities.
The HEALS Act includes a number of COVID-related tax incentives to help local businesses keep and hire workers, while creating healthy workplaces for customers and employees.
It also helps the unemployed reconnect to their job by transitioning the $600-a-week federal unemployment supplement to one based on state unemployment formulas that better reflect actual wages and regional salaries. Another round of stimulus checks that send $2,500 to a family of four will also make the transition smoother.
These are practical, immediate solutions that give immediate support to prevent the 30 million Americans temporarily unemployed from becoming permanently unemployed.
However, Congress needs to include two more key elements to restore a strong, post-COVID economy that expands paychecks and increases the number of U.S. jobs: First, we must make America medically independent from China. Second, we must use pro-growth policies that will foster real prosperity beyond just getting through the next few months.
During this crisis, we have learned about America’s vulnerability to China when it comes to crucial medicines, medical supplies, ingredients, and technology. Yet Congress, despite spending trillions to deal with the fallout from that vulnerability, has not acted on this cruel COVID lesson.
Working with House Republicans, the Ways and Means Committee GOP have developed and introduced legislation to make America medically independent from China. Our approach establishes resilient supply chains anchored in the U.S. and running through reliable trading partners.
These bills include aggressive, smart tax incentives to on-shore the research and manufacturing of crucial medicines, medical supplies, ingredients, and technology. We offer new tax incentives for developing more infectious-disease drugs while cutting the corporate tax rate in half for advanced manufacturing done here in the U.S.
This will protect lives and create good-paying American jobs.
We need growth, too. While the Tax Cuts and Jobs Act (TCJA) helped restore the U.S. as the most competitive economy on the planet, we must do more to spur growth for the long-term post-COVID — especially in the area of innovation.
The nation that wins the innovation race wins the future. So House Republicans have introduced pro-growth legislation that brings back to the U.S. intellectual property held overseas, permanently doubles the research-and-development tax credit, repeals an upcoming tax deadline that discourages research in America, and makes permanent one of the most pro-growth policies of the TCJA: expensing.
Including these pro-growth policies in the current COVID package will ensure that American businesses can invest now with certainty in the equipment, research, technology, and software to expand our economy beyond the pandemic.
This next step should safeguard the health, medical security, and financial needs of the American people, both now and well into the future. They deserve these tools to help them resume their livelihoods and take care of their families.
COVID-19 presented unexpected challenges, and Americans are doing their part to beat this virus. They deserve Congress’s best effort to build a stronger, healthier, and more prosperous America.