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GOP set to propose smaller coronavirus stimulus bill

U.S. President Donald Trump addresses the first day of the Republican National Convention after the delegates voted to confirm him as the Republican 2020 presidential nominee for re-election in Charlotte, North Carolina, U.S., August 24, 2020.

Carlos Barria | Reuters

Republicans are working on a more narrow coronavirus stimulus bill that they could release to members of Congress as soon as this week, two senior administration officials and three people briefed on the matter told CNBC.

The GOP is mulling a roughly $500 billion proposal that addresses only areas of bipartisan support: expanded unemployment insurance, a new authorization of small business loans and money for schools and Covid-19 testing, treatment and vaccines. The plan would not include another direct payment to Americans. 

It would set enhanced jobless benefits at roughly $300 to $400 per week. The figure would be less than the $600 per week approved in March, which Democrats want to reinstate after it expired at the end of July. 

While Republicans appear intent on putting more pressure on Democrats, the legislation is unlikely to become law. House Speaker Nancy Pelosi, D-Calif., still does not plan to restart stalled pandemic aid talks with the White House until the GOP agrees to double the price tag of its existing, roughly $1 trillion proposal, her spokesman Drew Hammill said Wednesday. 

“Democrats have compromised in these negotiations. We offered to come down $1 trillion if the White House would come up $1 trillion. We welcome the White House back to the negotiating table but they must meet us halfway,” he said. 

Earlier, White House chief of staff Mark Meadows told Politico that he had his staff “reach out” to Pelosi’s office on Tuesday. Hammill said a Meadows aide did not mention the prospect of resuming negotiations. 

Meadows said he expects Pelosi to hold out until the end of September, when Congress faces a deadline to avoid a government shutdown, to try to get her desired relief provisions in a bill. 

Congress has failed to pass legislation to respond to overlapping health and economic crises even after financial lifelines for Americans expired. A $600 per week extra jobless benefit, a federal moratorium on evictions and the window to apply for Paycheck Protection Program small business loans have all lapsed. 

While new coronavirus infections in the U.S. have slowed, the country is still typically reporting tens of thousands of cases per day during a sprint to create more effective Covid-19 treatment and a vaccine. Despite three months of rapid employment gains on the heels of historic job losses, the U.S. unemployment rate still topped 10% in July. 

Discussions between the Trump administration and Democrats on providing more relief have stalled. Sticking points include how much aid to send to state and local governments, how much money to send schools adjusting to either physical reopening during the pandemic or remote learning and whether to maintain the $600 weekly unemployment payments. 

President Donald Trump took executive action this month to allow states to temporarily extend extra jobless benefits of at least $300 per week. Most states have opted into the program, but the funding redirected from the executive branch is only expected to last a few weeks. 

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