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Democrats offer to lower coronavirus relief package cost by $1 trillion as new talks begin

U.S. House Speaker Nancy Pelosi (D-CA), speaks next to Senate Minority Leader Chuck Schumer (D-NY), during a news conference on Capitol Hill in Washington, August 7, 2020.

Jonathan Ernst | Reuters

The prospects for a broad coronavirus relief package appeared grim Friday after a bitter meeting between Democratic leaders and Trump administration officials yielded little progress. 

Negotiators will huddle again at 1:30 p.m. ET on Friday to try to strike a deal to lift a U.S. economy and health-care system struggling under the weight of a once-in-a-lifetime pandemic.

On Friday, House Speaker Nancy Pelosi said that during a Thursday night meeting she offered to cut her desired aid price tag by $1 trillion if Republicans increased the size of their plan by $1 trillion. The Trump administration declined, she said.

Pelosi added that she could cut back spending by making some programs expire earlier than originally proposed. House Democrats passed a roughly $3 trillion relief package in May, and Republicans last week proposed a bill that costs about $1 trillion. 

Neither House nor Senate Democrats would accept legislation that puts “south of $2 trillion” into the pandemic response, Senate Minority Leader Chuck Schumer said Friday. Entering Pelosi’s office, Treasury Secretary Steven Mnuchin said boosting the cost of the GOP plan by $1 trillion is a “non-starter,” making it unclear where the sides could find common ground. 

After the more than three-hour meeting Thursday night, Pelosi, Schumer, Mnuchin and White House chief of staff Mark Meadows painted a dismal picture of aid talks that have accomplished little over a week and a half. 

“We have always said that the Republicans and the president do not understand the gravity of the situation and every time that we have met, it has been reinforced,” Pelosi, a California Democrat, told reporters Thursday. 

Democrats and Republicans appear to have come closer to an accord on issues including direct payments of up to $1,200 to Americans and extending a moratorium on evictions from federally backed housing. They have failed to bridge a gulf on how to continue enhanced federal unemployment benefits, help schools reopen safely during the pandemic, and aid state and local governments facing budget shortfalls during the outbreak.

White House Chief of Staff Mark Meadows (L) speaks to reporters alongside Treasury Secretary Steven Mnuchin (R) following continued negotiations with House Speaker Nancy Pelosi (D-CA) and Senate Minority Leader Chuck Schumer (D-NY) on a new economic relief bill in response to the coronavirus pandemic on Capitol Hill on August 6, 2020 in Washington, DC.

Samuel Corum | Getty Images

Mnuchin said Thursday that the sides have moved closer to agreement on only some topics. 

“I think there is a lot of issues we are close to a compromise position on, but I think there are a handful of very big issues that we are still very far apart,” he said. 

“We’ll see,” he later added. “I think we always said our objective is to try to reach an overall understanding tomorrow. If the Democrats are willing to compromise and do something, I think we’ll get something done.”

In a letter to colleagues Friday, Pelosi outlined several areas of disagreement. It notably did not mention jobless benefits. 

  • She said Democrats aim to put $75 billion into Covid-19 testing and treatment, while the GOP bill includes $15 billion. 
  • Pelosi wrote that the GOP has offered $150 billion for states and municipalities, far below the $915 billion Democrats proposed. 
  • The speaker said the sides are “a couple hundred billion dollars apart” on money to help schools reopen. Republicans included $105 billion for schools in their legislation. 
  • Pelosi called for more money for food, water and utility assistance than the GOP has proposed. 
  • She said Democrats wanted to secure more concessions on ensuring a complete Census and safe voting during the pandemic.

It would take a massive effort for Democrats and the White House to even reach the outline of a deal Friday. But the clock is ticking: the expiration of both the $600 per week enhanced federal unemployment benefit and the eviction moratorium late last month have left millions of Americans scrambling to cover bills and remain in their homes. 

The U.S. added 1.76 million jobs in July despite a resurgence in coronavirus cases that forced many states to pause or reverse their economic reopening plans. The unemployment rate fell to 10.2%, but was still higher than at any point during the 2008 financial crisis.

In a joint statement after the jobs report release, Pelosi and Schumer said the data shows “that the economic recovery spurred by the investments Congress has passed is losing steam and more investments are still urgently needed to protect the lives and livelihoods of the American people.” They urged White House officials “to join us once again at the negotiating table today.”

Democrats have insisted on extending the jobless benefit long term at $600 per week. The White House has made several counteroffers, reportedly proposing extra payments of $400 per week into December. 

On Thursday, Meadows told reporters the White House officials would “stay engaged” in talks to reach a comprehensive agreement. Meadows said Trump told his negotiators that if the broad approach does not work, they should try to strike a “narrower deal” that addresses unemployment aid and evictions. Democrats have repeatedly rejected a limited agreement.

“And if those two things do not work, then [Trump] is prepared to take executive action on his own,” the chief of staff said. 

Trump, who has not participated in face-to-face talks, tweeted Thursday that he instructed his staff to work on executive actions to offer coronavirus relief. The orders would address unemployment benefits, evictions, student loan repayment and a payroll tax cut, he said. 

It is unclear what power Trump has to tackle those topics on his own. Congress controls federal spending. Pelosi told CNBC on Thursday that she thinks the president has the power to extend the eviction moratorium, and urged him to do so. 

Schumer, though, cautioned Trump on Thursday against taking executive action. He indicated an order could get held up in court. 

“An executive order will leave millions of people out. It will be litigated. It won’t be effective, and things will get worse,” the New York Democrat said after the talks. 

Speaking to reporters Friday, Schumer added that an executive order would be inadequate because it would not include money for schools and Covid-19 testing and treatment. 

If the sides can avoid executive action and reach a deal, passage of a bill may not come for at least another week. 

Both the Senate and House left for the weekend after Thursday’s sessions. The chambers have delayed their planned August recesses as they anticipate votes on a pandemic relief package. 

Complicating matters in Congress, the talks have taken on bitterness less than three months before the general election. Senate Majority Leader Mitch McConnell, R-Ky., finds himself stuck between conservative senators who don’t want to spend more money and swing-state Republicans who need to win their races in November for the GOP to keep its majority in the chamber. 

He will likely have to rely on strong Democratic support to get a bill through the Senate. 

For now, a moment of unity looks far away. Pelosi went as far as to say Meadows “slammed the table and walked out” of the meeting on Thursday. 

Meadows disputed the account. 

“It’s fabricated,” he said.

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