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Economy

COVID-19 Aid Talks on Brink of Collapse, Sides “Very far Apart”

WASHINGTON — Washington talks on vital COVID-19 rescue money are teetering on the brink of collapse after a marathon meeting in the Capitol generated lots of recriminations but little progress on the top issues confronting negotiators. 

"There's a handful of very big issues that we are still very far apart" on, said Treasury Secretary Steven Mnuchin. He talked of impasses on aid to states and local governments and renewing supplemental unemployment benefits in the Thursday night meetings.

Both sides said the future of the talks is uncertain. President Donald Trump is considering executive orders to address evictions and unemployment insurance, but they appear unlikely to have much impact.

A breakdown in the talks would put 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 avoid furloughing workers and cutting services as tax revenues shrivel.

House Speaker Nancy Pelosi, D-Calif., and top Senate Democrat Chuck Schumer of New York emerged to give a pessimistic update about the chances for an agreement. 

"We're very far apart. It's most unfortunate," Pelosi said. 

Both sides have adopted a hard line in the talks, though the Trump team is more open in disclosing a handful of its proposed compromises. Republicans were late to agree to the talks and have become frustrated by the inflexible tactics of Pelosi and Schumer, who have been exuding confidence in a political and legislative landscape that's tilted in their favor. 

The Democratic pair say the federal coronavirus aid package needs to be huge to meet the moment: a surge in 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."

Senate Republicans have been split, with roughly half of McConnell's rank and file opposed to another rescue bill at all. Four prior coronavirus response bills totaling almost $3 trillion have passed on bipartisan votes despite intense wrangling. But Trump and McConnell want a bill and discussed the topic at the White House on Thursday morning.

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.

"Don't nickel and dime our children," Pelosi said. "Don't say, 'We want to give a tax break to a business lunch and not give more money for children to have food stamps.'"

Pelosi was referring to a GOP proposal to increase the deduction for business meals from 50% to 100%. The idea seems likely to die, along with Trump's efforts to cut the Social Security payroll tax. But Schumer and Pelosi continue to push to restore a tax break for state and local taxes paid mostly by wealthier people with high incomes and valuable homes.

McConnell, R-Ky., is likely to have to assume a higher profile if the talks are to come to a successful close, but he issued a grim assessment of the situation Thursday, again 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.

Frustration was palpable among Republican senators shuttling in and out of a GOP lunch session, some of whom say Schumer is intent on using the situation as a hammer against Republicans. Schumer is desperate to win the Senate majority just as Republicans are in trying to hold on in a terrible political year.

"As long as they calculate that they're better off politically doing nothing, it's going to be hard for us to move forward," said Sen. Marco Rubio, R-Fla. "And that's the calculation they've made, it appears."

McConnell is sending the Senate home rather than forcing impatient senators to bide their time while Democrats play hardball. That suggests a vote won't come until late next week or even after. Progress has been scant in the talks despite more than a week of negotiation.

White House negotiators made some concessions on jobless benefits and aid to state and local governments in a Tuesday session — and then promptly got scalded by Republicans after details leaked out.

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