A Republican stimulus package with targeted relief for airlines and almost no student loans assistance was put forward by Treasury Secretary Steven Mnuchin.

Treasury Secretary Mnuchin Testifies At House Hearing On Coronavirus
(Photo : Nicholas Kamm-Pool/Getty Images)
U.S. Treasury Secretary Steven Mnuchin testifies before the House Select Subcommittee on the Coronavirus Crisis on September 1, 2020 on Capitol Hill in Washington, DC.

It is a scaled down version of the Republican stimulus bill that addresses relief for targeted sectors like airlines and travel. Student loans were also removed to get slimmer relief bill.

According to Bloomberg News, Mnuchin said the new Republican stimulus will be geared towards relief for major airlines. These were one of the hardest hit by the pandemic.

There also won't be further aid for student loans. This is because President Trump has already extended the CARES Act's suspension of student loan payments through December 31.

Senate Republicans received encouragement from the White House to work on a slimmed down stimulus. It will spend much less money than the $1 trillion offer put forward by Senate GOP last month.

There are no fresh proposals on how to get Democrats back to negotiations. There have been no talks since the last round broke up almost a month ago.

Airline Assistance

Mnuchin said some parts of the economy still needs more support even through some are already recovering. Jobs are returning for some sectors but the travel industries and small businesses still have a long way to go.

United Airlines recently warned that over 16,000 of their employees will go through indefinite furlough. This reduces their work force by 25% amid the pandemic, as said on Morning Edition NPR.

American Airlines and Delta Airlines also announce the same kind of workforce cuts. They will do so through furloughs, layoffs, and buyouts.

Some major airlines have already announced in the past week that they will be cutting travel capacity.

"What is most important is that we deliver some relief quickly to the American workers impacted by this," Mnuchin said in a Coronavirus Crisis hearing Tuesday.

Trump also said he's considering to extend more help to the airlines, maybe through executive action.

Student Aid

As the CARES Act suspension of student loan payments and interest has been extended by Trump, no more relief is expected for student loan borrowers.

The move was criticized by advocacy groups. The groups believe the action was not enough.

They called for a more widespread relief bill that covers all student loans. The CARES Act limits student loan relief to government-held loans only, said a Forbes report. The groups also called for broad student loan forgiveness.

The Student Borrower Protection Center released a statement earlier regarding the matter. They said the actions on student debt "falls short of what Americans need to stay afloat" amid the health and economic crisis.

For other student loans, there also won't be any direct stimulus payments to taxpayers. It will have a scaled-down unemployment benefit of $300 per week, reports claim.

Lower Price Tag

The GOP stimulus plan will cost about $500 billion. This is a far lower price tag than the $2 trillion to $3 trillion relief proposed by Congress Democrats.

The HEROES Act was passed in May. It will include enhanced jobless pay of $600 per week.

Student loans payment will also be extended until September 30, 2021. That is a full 12 months worth of suspension. Notably, the bill will also give $10,000 in federal and private student loan forgiveness for borrowers in economic distress.

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