Coronavirus Stimulus talks with White House deadlocked

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WASHINGTON – The White House’s latest strengthened bid on a new coronavirus package hit resistance from Democrats and Republicans over the weekend, dashing hopes that a bipartisan deal was imminent.

Democrats have criticized Treasury Secretary Steven Mnuchin’s nearly $ 1.9 trillion offer as insufficient, particularly in its funding and coronavirus screening and testing strategy. Senate Republicans, meanwhile, were hesitant about the cost of the offer and its proposed extension of the Affordable Care Act. Concerns on both sides of Capitol Hill lowered expectations that rose on Friday when President Trump approved the GOP’s most generous offer to date in negotiations.

In a letter to House Democrats on Sunday, House Speaker Nancy Pelosi (D., Calif.) Said the new administration’s offer provided inadequate funding and no national plan for testing, researching contacts and treatment of coronavirus. “Last week the president made it very clear that he did not take the war on the virus seriously, either personally or nationally. This attitude is reflected in the manifestly inadequate response we finally received from the administration on Saturday, ”Ms. Pelosi wrote. “Until these serious issues are resolved, we remain at an impasse.”

House Democrats have called for $ 75 billion and a national plan to test, locate and treat the virus. Ms Pelosi said in her letter that the White House plan included around $ 45 billion in new funds, lacked a national testing and tracing plan and did not address the disproportionate impact of the virus on minority communities.

President Trump, in brief comments on the matter, said Republicans were still eager to reach a deal.

“Republicans want to do it. We’re having trouble with Nancy Pelosi, ”he told Fox News on Sunday.

While the White House called the offer about $ 1.8 trillion, a person familiar with the proposal said it included $ 1.88 trillion in spending, with around $ 400 billion in funds reallocated. from unspent money from previous relief legislation, bringing the total cost to around $ 1.5. one thousand billion.

Mr. Trump is facing resistance from some Republicans who are reluctant to approve more federal aid after Congress authorized around $ 3 trillion in coronavirus relief since March.

In a conference call Saturday morning with White House Chief of Staff Mark Meadows and Treasury Secretary Steven Mnuchin, several Senate Republicans spoke out against the passage of another major aid package. , according to people close to the call. Mr Meadows said he would bring their concerns back to President Trump, suggesting he expected a less than warm welcome, joking that, therefore, lawmakers should attend his funeral, according to the people.

In a letter to members of Congress on Sunday, MM. Mnuchin and Meadows urged lawmakers to pass legislation helping small businesses while continuing to negotiate with Ms Pelosi. Democrats have generally refused to tackle individual bills, saying they want to hold a large package.

“We will continue to work with President Pelosi and Senator Schumer,” wrote MM. Mnuchin and Meadows. “The all or nothing approach is an unacceptable response to the American people.”

The latest White House proposal capped a tumultuous week, in which Mr. Trump ended negotiations, before being overturned. The nearly $ 1.9 trillion offer comes close to the $ 2.2 trillion plan that House Democrats approved earlier this month, though major differences between Democrats and the White House remain.

The two sides moved closer to a contentious issue: state and local government funding, which Republicans have called a bailout for Democratic-led states. The White House’s most recent offer included $ 300 billion in funding for states and local communities, up from $ 250 billion in their latest proposal. The Democrats, who originally claimed more than $ 900 billion, included $ 436 billion in their latest bill.

During the first presidential debate, President Trump and Democratic presidential candidate Joe Biden answered questions about the economic fallout from the coronavirus pandemic and their differing views on reopening the country. Photo: Jim Lo Scalzo / EPA / Shutterstock

The latest White House proposal would also partially restore $ 400 in weekly federal unemployment benefits, which expired in late July until Jan.21, 2021, according to a person familiar with the proposal. In their latest bill, Democrats proposed to take back the weekly sum of $ 600 until January 2021.

GOP lawmakers told Trump administration officials on Saturday that they should negotiate a cheaper bill that Senate Republicans rallied around last month, people familiar with the call said, saying such a package was not necessary.

A major source of concern among Senate Republicans is the provision of the White House proposal to expand Affordable Care Act subsidies for people who have lost their jobs, and with them their sponsored health care. employer, during the pandemic.

Many Republicans oppose an extension of the ACA, which they have criticized and sought to repeal for years. Many Republicans also view its restrictions on abortion funding as insufficient and see increased subsidies making this problem worse. They told Mr. Mnuchin that such a provision was unacceptable, according to GOP collaborators.

During the appeal, Sen. John Barrasso (R., Wyo.) Said a proposal to expand Eligibility for Affordable Care Act grants would represent a “huge betrayal,” people say. .

Democrats said Republicans simply oppose an expansion of the ACA and noted that the health care law already prohibits the use of federal funds made available to consumers through grants and credits. tax for most abortions, with a few exceptions for rape, incest and when a pregnant woman’s life is in danger. Health-on-exchange plans can cover other abortions, but they must set aside separate funding so it doesn’t come from federal grants.

Republicans are also opposed to an effort to expand eligibility for a second round of $ 1,200 stimulus payments. The first round of direct checks required beneficiaries to have a Social Security number to be eligible and excluded certain married US citizens or children of immigrants who work illegally in the United States but pay income taxes in the United States. .

In the absence of another relief deal, economists say, temporary layoffs will become permanent and more businesses will close, characteristic of a typical recession rather than the temporary shock and rapid rebound hoped for by policymakers at the start of the year. this year.

The risks of Congress providing too little support to the economy are greater than the risks of providing too much, Federal Reserve Chairman Jerome Powell said last week. The former could lead to a longer and weaker recovery, he said.

Write to Kristina Peterson à [email protected] and Andrew Duehren at [email protected]

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