Impasse on US virus aid package

Hopes for a vital economic rescue package are souring in the US amid increasing worry that negotiations between the Republicans and Democrats might collapse.

The impasse in the negotiations is putting at risk more than $100 billion to help reopen schools, a fresh round of $1,200 direct payments to most people, and hundreds of billions of dollars for state and local governments to help them deal with the impact of coronavirus.

President Donald Trump went into a huddle with majority Leader Mitch McConnell, a key player in the troubled talks, as House Speaker Nancy Pelosi and Senate Minority leader Chuck Schumer, yielded little ground on an unprecedented $3.5 trillion House-passed rescue package.

McConnell seemed to downplay the significance of the Trump meeting, telling a reporter merely that “we talked a little bit about everything.”

Trump and McConnell both badly want an agreement, but Democrats control the House and may actually provide the lion’s share of votes in the Senate. 

Democrats say the federal coronavirus aid package needs to be huge in order to meet the moment: a surge in virus cases and deaths, double-digit joblessness, and the threat of poverty for millions of the newly unemployed.

“We believe the patient needs a major operation while Republicans want to apply just a Band-Aid,” Schumer said. “We won’t let them just pass the Band-Aid, go home and leave America bleeding.”

After a Wednesday session that produced no progress, White House chief of staff Mark Meadows and Treasury Secretary Steven Mnuchin were returning to Pelosi’s Capitol suite to confront the gulf in their negotiating stances. Both sides have set a goal of agreeing on a deal by week’s end – though that is appearing increasingly out of reach.

The White House is also promising that Trump will attempt to use executive orders to address elements of the congressional package involving evictions and jobless benefits. But there’s no evidence that the strategy would have much impact or be anything close to what’s necessary, and Pelosi appeared unimpressed at a morning news conference.

“I don’t think they know what they’re talking about,” Pelosi said dismissively.

Pelosi and Schumer staked out a firm position to extend a lapsed $600-per-week bonus jobless benefit, demanded generous child care assistance and reiterated their demand for food stamps and assistance to renters and homeowners facing eviction or foreclosure.

McConnell issued a grim assessment of the situation on Thursday, complaining that Pelosi and Schumer are not negotiating in good faith.

“Day after day, they’ve stonewalled the president’s team. Day by day, they’ve tried to invent new euphemisms to create the illusion of progress,” McConnell said Thursday.

McConnell is sending the Senate home rather than forcing impatient senators to bide their time while Democrats play hardball.

But Pelosi will likely have to make some concessions soon. Her dollar figure for aid to states and local governments far exceeds what independent experts such as Moody’s Analytics recommend, for example, and her position in favour of restoring the expensive state and local tax break is probably unsustainable.

“She’s not going to allow the negotiations to collapse. She knows what the right moment is to pull the trigger and to try and close the deal,” said Democratic lobbyist Steve Elmendorf. “But she also knows when to wait and to let the other side come to you.”

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