Trump, Pelosi tout stimulus progress but differ on scope of deal

President Donald Trump and House Speaker Nancy Pelosi both said on Wednesday talks between the White House and Democratic legislators over a new round of virus relief aid are progressing.

But the two appear to still be miles apart when it comes to the scope of the package under discussion – a chasm that may bode poorly for a new round of stimulus to help struggling Americans before the November 3 elections.

In an interview with Fox Business News on Thursday, Trump said he called off virus relief aid talks with Congressional Democrats two days ago “because they weren’t working out”.

Trump dropped the bombshell on Tuesday that he had halted stimulus talks with democratic legislators until after the election, only to reverse course within hours and urge Congress to pass targeted aid including financial lifelines for airlines, small businesses, and a new round of $1,200 stimulus cheques for individuals.

“We’re starting to have some very productive talk,” Trump said on Thursday.

“We started talking again. And we’re talking about airlines and we’re talking about a bigger deal than airlines. We’re talking about a deal with 1200 dollars per person and we’re talking about other things.”

Pelosi’s camp confirmed on Wednesday the House speaker had spoken to US Treasury Secretary Steven Mnuchin – the Trump administration’s point man on stimulus talks – about a standalone $25bn package for the nation’s airlines which are currently laying off tens of thousands of workers.

On Thursday though, Pelosi said while she is open to a separate deal for airlines, that can only happen as long as there is agreement over a more comprehensive COVID-19 relief package.

“Ain’t going to be no standalone bill, unless there is a bigger bill,” Pelosi told reporters.

The competing narratives over targeted versus comprehensive aid are happening against a backdrop of mounting evidence that the US economic recovery is slowing as the effects of the nearly $3 trillion in stimulus passed earlier this year wear off.

Applications for unemployment benefits filed with states – a proxy for layoffs – fell to 840,000 last week, the US Department of Labor said on Thursday.

Though slightly lower than the previous week, initial jobless claims are still roughly four times higher than February’s pre-pandemic levels.

On Tuesday, Federal Reserve Chairman Jerome Powell warned the economic recovery could be imperilled without more government stimulus.