$600 a week a sticking point for US coronavirus relief bill

Democrats, Republicans differ over priorities in new round of coronavirus aid between $1 trillion and $3.3 trillion.

Nancy Pelosi and Chuck Schumer
House Speaker Nancy Pelosi, left, and Senate Minority Leader Chuck Schumer have been meeting White House officials to negotiate a coronavirus relief bill for the United States [Susan Walsh/AP Photo]

Negotiators on a huge coronavirus relief bill reported slight progress after talks between congressional Democrats and the White House resumed in the United States Capitol, with issues like food for the poor and aid to schools assuming a higher profile in the discussions.

After a week of almost daily negotiations, Senate Democratic leader Chuck Schumer said he, House of Representatives Speaker Nancy Pelosi, Treasury Secretary Steven Mnuchin and White House Chief of Staff Mark Meadows have moved closer in several areas.

“We remain far apart on a number of issues. But we’re finally moving in the right direction,” Schumer said on the Senate floor on Tuesday. “At the moment, the gap between our two parties in the negotiations is about priorities and about scale.”

After meeting on Monday, Pelosi told her Democratic colleagues on a call that she is hopeful a deal could be reached this week but does not know if it is possible, according to a Democratic aide who spoke on condition of anonymity to describe the private discussion.

Neither side has budged from their positions, with Democrats demanding an extension of the $600-per-week supplemental unemployment benefit that is credited with propping up the economy.

Republicans have yet to offer any aid Democrats want for US states to prevent furloughs, layoffs and cuts to public services. Both sides will likely have to compromise before a deal can be agreed.

“The $600 unemployment insurance benefit is essential because there are no jobs to go back to,” House Democratic Caucus Chair Hakeem Jeffries of New York said on MSNBC on Tuesday morning.

“We’ve got to help out every-day Americans. That’s a line in the sand,” Jeffries said.

Senate Republicans facing re-election in the US’s turbulent political environment are among those most anxious for an agreement.

Senators John Cornyn, of Texas, said on Monday that the chamber should not go on recess without passing the huge relief measure, and Lindsey Graham, of South Carolina, offered a jobless benefit proposal more generous than a pending Republican alternative. Both are facing closer re-election bids in states that should be easy holds for Republicans.

Treasury Secretary Steven Mnuchin, a lead negotiator for President Donald Trump, said on Monday that “we continue to make a little bit of progress” and that the administration is not insistent on a small-bore approach centred on extending the supplemental unemployment benefit and leaving other items for later.

A Republican move to advance a slimmer relief package has been a point of conflict, with Democrats insisting there must be a comprehensive deal.

“We’re open to a bigger package if we can reach an agreement,” Mnuchin said.

Steve Mnuchin and Mark Meadows
Treasury Secretary Steven Mnuchin, right, and White House Chief of Staff Mark Meadows, second from right, sit down in the office of Senate Majority Leader Mitch McConnell in the US Capitol to brief him on talks with Democrats [Susan Walsh/AP Photo]

Senate Republican leader Mitch McConnell renewed his complaints that Democrats are taking too tough a line. McConnell is not a direct participant in the talks but is likely to be an important force in concluding any potential agreement.

Speaking to reporters after Monday’s two-hour session, Democratic negotiators pressed the case for additional food aid, funding for the Postal Service, and the $600-per-week jobless benefit that lapsed last week.

The benefit has helped sustain consumer demand over recent months as the coronavirus has wrought havoc on the US economy.

Pelosi wants to extend the $600-a-week benefit through January at a cost of more than $400bn, while Republicans are proposing an immediate cut to $200-a-week and then replacing the benefit with a calibrated system that would provide 70 percent of a worker’s “replacement wage”.

Most members of the Democratic-controlled House have left Washington, DC and will not return until there is an agreement to vote on, but the GOP-held Senate is trapped in the capital.

“I can’t see how we can go home and tell people we’ve failed, so I think that’s going to be a lot of pressure on everybody to come up with something,” said Cornyn, a close ally of McConnell.

“It really is a matter of will. It’s not a matter of substance at this point. This is just a painful period between people finally deciding OK, we want a deal, and then what that deal will ultimately look like,” Cornyn said.

Mitch McConnell
Senate Majority Leader Mitch McConnell, a Republican, walks back to his office in the US Capitol in Washington, DC on August 3, 2020. McConnell has resisted renewing a $600-a-week federal payment to unemployed workers [Susan Wals/AP Photo]

Areas of the agreement already include another round of $1,200 direct payments and changes to the Paycheck Protection Program to allow especially hard-hit businesses to obtain loans under generous terms.

On unemployment, Pelosi said she would consider reducing the $600 benefit for people in states with lower unemployment rates. Republicans want to cut the benefit to encourage beneficiaries to return to work and say it is bad policy because it pays many jobless people more money than they made at their previous jobs.

Graham is among the Republicans who most aggressively protested the $600-a-week benefit when it passed Congress in March, but on Monday he said he wants to replace it with a system ensuring 100 percent of replacement wages.

The House passed a $3.5 trillion pandemic rescue measure in May, but Republicans controlling the Senate had demanded a slower approach, saying it was necessary to take a pause before passing additional legislation. Since they announced that strategy, however, coronavirus cases have spiked, and the US economy has absorbed a new slowdown.

The Senate Republican proposal carries a $1.1 trillion price tag, according to an estimate by the Committee for a Responsible Federal Budget.

Source: News Agencies