Stimulus Update: After Lackluster Jobs Report And Trump’s Covid-19 Bombshell, Pelosi Signals A Deal Is Still Possible
House Speaker Nancy Pelosi (D-Calif.) said she and Treasury Secretary Steven Mnuchin are “coming to terms” on key testing and tracing provisions in the next round of federal coronavirus aid, even as Washington awoke Friday morning to news that President Trump and the First Lady had both tested positive for Covid-19.
In an interview on MSNBC, Pelosi said that she and the Trump administration are moving closer together on the amount of virus spending in the bill but still need to hash out the language related to that spending, as well as other issues.
New aid to state and local governments (Democrats want roughly double the spending the White House is willing to accept) and certain tax changes are among the biggest hurdles still preventing a deal.
Pelosi noted the possibility that Trump’s diagnosis might encourage Senate Republicans, who have been so far opposed to spending on the levels that she has been discussing with the administration so far (between $1.6 and $2.2 trillion), to support the next package.
On Thursday evening, the House passed a $2.2 trillion coronavirus relief bill, but no Republicans signed on and the bill is extremely unlikely to even get a vote in the Senate.
Some Democrats, hoping for a bipartisan compromise this week instead, also voted no on the measure.
“This kind of changes the dynamic,” Pelosi said of Trump’s announcement that he had tested positive for Covid-19, “because here [Republicans] see the reality of what we have been saying all along. This is a vicious virus.” Trump and his close advisors have continually played down the threat of the pandemic.
661,000. That’s how many new jobs were added in September, according to data released Friday by the Labor Department, compared to the 859,000 that were expected. The unemployment rate fell to 7.9%. Pelosi said she was “very concerned” about the new data.
September’s jobs report showed a slowing economic recovery after the expiration of key stimulus benefits, including forgivable loans for small businesses designed to keep workers on their payrolls and an extra $600 per week in unemployment benefits from the federal government, over the summer. The number of long-term unemployed (people who have been out of work for at least 27 weeks, which is beyond the expiration of traditional state benefits) and the number of people who have lost jobs permanently have both grown, tightening the focus on whether Congress will provide more federal aid to prop up the fragile economy in the last days ahead of the November election. If not, it’s very possible that the economic situation will become even more dire. “Everything depends on Phase 4 [the next round of federal aid] and whether we get that or not,” Aneta Markowska, chief economist at Jefferies, told the New York Times. “There’s no middle ground.”
Mnuchin tested negative for the virus on Friday morning. Pelosi told MSNBC she is still awaiting the results of her own tests. The two met in person on Wednesday to discuss the aid bill.
Trump, First Lady Test Positive For Covid-19 (Forbes)
House Passes $2.2 Trillion Stimulus Bill, But That Doesn’t Mean $1,200 Checks And More Unemployment Benefits Are On The Way (Forbes)
Still No Deal On Second Stimulus As Early Optimism Wanes (Forbes)
Stimulus Update: Mnuchin Says Next Bill To Include $1,200 Checks ‘If There Is A Deal,’ Offers Pelosi $1.6 Trillion (Forbes)