The year 2020 tainted by a malevolent virus, Covid-19, declared as ‘Pandemic’ by the World Health Organisation (WHO) has brought a halt to all the economic activities. With more than 5.5M infected and 172k casualties, in the United States, the US Government is siding a battle between the HEROES Act and the HEALS Act passed by the two parties – Democratic and Republican respectively to aid the people of the country . The CARES Act to expire soon, the Washington Law makers are ambiguous in opting between the two acts.

THE CARES ACT - Performance and loopholes:

The Corona Virus Aid, Relief and Economic Security Act (CARES) , a $ 2.3 trillion budgeted act passed by the 116th US Congress and was signed by the first person of America, Mr. Donald Trump on March 27, 2020. The main aim of the act was to provide relief to the individuals and businesses affected by the global pandemic. The key features included stimulus payment of $1500 to the individuals, $500 per child, payment for workers upto $600 per week for four months, unemployment insurance extended till 31st December, 2020, bailout for self-employed, agriculture sector bailout increased from $30 billion to $50 billion, payroll tax extended till 2022, $150 billion for state, local and tribal government ($30 billion for education, $45 billion for disaster relief, $25 billion for transit programs), no cost for corona virus testing, $140 billion for the US health care system out of which $100 billion provided directly to the hospitals, $500 billion for large corporations including airlines (financial security), increase in interest rate from 30% to 50%, $350 billion for stumbling small scale business firms.

Fig 1.1., The depiction of the funds allocated to each sector.

The major loophole circulating around the CARES act is about the ignorance of the safety of the workers. The owes mentioned in the act places the economy in a position where it cannot be rebooted to its original level after the pandemic diminishes. The policy focusses only on the citizens unemployed due to the pandemic and not on the people who are on paid leave or on sickness or residing at their houses and are taking care of a family member. Instead of extending due dates for loans, the act could have focussed on preserving the jobs and maintaining the wages for the people engaged in the small-scale businesses. In this way, loans could have been avoided. The state and the local government are in indispensable need of federal support. The act vehemently has a deadline for each benefit provided. Rather than time based, the act should have focussed how rationally it can minimise human suffering.

THE HEROES ACT:

The Health and Economic Recovery Omnibus Emerging Solutions act (HEROES), a $3 trillion COVID-relief bill, was drafted by the US Democrats on May 12, 2020. It is termed as ‘COVID 4.0’ in Washington because it is the fourth legislative measure towards the pandemic. The Senate has not passed it as it is resisted by the Republican leader Mitch McConnell claiming that the act concentrates more on prolonged unemployment protection, assisting the state and local governments. In the words of speaker Pelosi, the HEROES act has three facets:

Fig 1.2., the depiction of the facets of the HEROES Act.

The key features of the act include providing $1trillion to the state, local, territorial and tribal governments for fiscal (out of which, money is contributed to the development of each sector), payment of $200 billion provided as hazard pay to the workers, provision of $1200 per individual or $6000 per household, the Unemployment Insurance (UI) of $600 extended till 31st January, 2021, implementation of infection control at the work places, $3.1billion allocated to the department of labour, $175 billion in housing assistance ($100 billion as emergency assistance for low-income households, $10 billion for the Supplemental Nutrition Association Program (SNAP), the student loan of $10,000 forgiven, developing Small Business Administration (SBA), including all the non-profit organisations in the Paycheck Protection Programme (PPP) and allocating $659 billion for PPE and $10 billion for the Economic Injury Disaster Loan Programme. It also aided government support to the United States Postal Service ($25 billion) and the Census Bureau ($410 billion).

Fig 1.3., the depiction of how funds are allocated in the HEROES act.

From the fig 1.3., it is evident that the funds are allocated by looking into the state’s rising unemployment levels (37%). The other factors include state population (28%), divided equally by state (19%), state’s COVID-19 (9%) and territories, tribal lands (7%).

The HEROES act has almost rectified the loopholes prevalent in the CARES act. The act provided financial support to the workers on paid leave and emergency leave. It mentioned about the occupational safety of workers at the workplace. It provided great relief to the state and the local Government by funding flexible direct grants to respond to the economic harm caused by the pandemic. It mentioned about the continuous supervision by the Government on the infection rates at the workplace. By the Defence Production Act (DPA), analysing the circumstances within 7 days and procuring timely medical facilities. It is helpful in securing the supply chain for indispensable medical needs. The premium pay of $13 per hour to the workers in the telecom, healthcare, aviation, journalism sectors. The continuous broadband service irrespective of the delay in the bill payments by the people due to the current menacing economic situation. The act should provide many more safety measures, keeping the workers at payrolls and reaching the needs of citizens.

THE HEALS ACT:

The Health, Economic Assistance, Liability, Protections and Schools Act (the HEALS) worth $1 trillion was drafted by the US Republicans on 27th June, 2020. It was the fifth COVID-19 relief package. According to The American workers, Families and Employers Assistance act, there was no extra aid provided, it remained the same $150 billion like in the CARES act. The Unemployment Insurance was reduced to $500 approximately which could aid only 70% of the unemployed worker’s bygone wages. The act expanded the Telehealth services and made it pliable for the Federally Qualified Health Centres (FQHCs), Rural Health Centres to reach out to the feeble remote residents. It put forth a protocol for testing, infection control, transparency in nursing facilities. The state owns 758 skilled nursing facilities. $ 2 billion was put aside as an emergency fund to increase 80% spending on cash assistance and it also supports the Temporary Assistance for Needy Families Programme (TANF), which is a temporary establishment located in eight states. The provision of funds to the helpless residents who are deprived of their basic needs. According to the Corona Virus Response, Additional Supplemental Appropriations Act, 2020, $302 billion was allocated to the supplemental appropriations which covered a wide range of economic factors. $16 billion was allocated for the COVID-19 testing, $2 billion for the mental health services, $ 1.5 billion was allocated for Substance Abuse and Prevention Treatment (SAPT) which aided the low-income households, individuals with HIV/ AIDS, pregnant women and the parenting youth and women and $15 billion was allocated for Child care [out of which $5 billion was allocated to the Child Care and Development Block Grant (CCDBG)]. The small scale business assistance was restricted to fewer than 300 workers. The small loans under $150,000 were grant. The act focussed on restarting the economy, so it also considered the safety of workers and it granted liability shield for the businesses, schools and hospitals up to five years.   

Fig 1.4, The depiction of the HEALS act’s motives.

From the fig 1.4, the HEALS act can simply be summarised as the act which is ‘ready to restart the economy by healing the affected sectors’. The major loophole in this act was no extra funds were provided to the nursing homes and no improvements were made in the Federal Medical Assistance Percentage (FMAP). No funds were allocated for the broadband internet. There were no modifications in expanding the administration flexibilities in the Supplement Nutrition Assistance Programme (SNAP). There was no mention about the safe electoral system in the act for the upcoming Federal elections. There were no advancements provided to the pensioners or post unemployed residents through the COVID Relief Fund (CRF). Beyond the US Treasury’s CRF, no modifications or alterations should be made by the local Government.

THE HEROES Vs THE HEALS – WHICH IS MORE ECONOMICAL?   

The HEROES and the HEALS acts have their respective pros and cons. In certain sectors, such as stimulus payment paid, provision of Unemployment Insurance (UI), the prolonged benefits of UI, provision of housing assistance, the HEROES act addressed these issues in a better way than the HEALS act. On the other hand, the HEALS act has formulated better strategies in provision of bonus for the employees returning to the work after pandemic or appointed again by the firm, allocated funds for COVID-19 testing, the reopening of the schools, better implementation of the Paycheck Protection Programme (PPP) and the provision of liability shield for business organisations and schools.

These two acts are economical when they both are unified where one leads to rekindling the economic progress and another one concentrates on the wellbeing of the residents. By making some alternations, if the Senate House combines both the acts and allocate the funds accordingly, this would help in uplifting the stumbling economy due to the pandemic. In conclusion, both the acts go hand-in-hand when merged into one best act focussing on the lives of the individuals and the economic progress of the United States.
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