Hopes for an end-of-the-year coronavirus relief deal are off to a rocky start, raising fresh questions about the chances for a long-elusive agreement before January.
Lawmakers in both parties say they want a deal, but they have just a few weeks to get one.
Neither side is signaling any interest in backing down, with both saying they have more leverage because of the elections.
Senate Minority Leader Charles Schumer (D-N.Y.) said the “starting point” on any agreement should be the $2.2 trillion coronavirus bill passed by the House in October, the same line Democrats have held for months.
“Joe Biden has won, now move on and work with us to solve the COVID crisis,” Schumer said Thursday, pointing to the results of the presidential election. “The American people are waiting for relief from the COVID virus, but Republicans refuse to take comprehensive action that meets the needs of the country.”
Senate Republicans are digging in on the roughly $500 billion figure that they previously coalesced behind. Senate Majority Leader Mitch McConnell (R-Ky.) is making it clear that he wants any deal to mirror the scaled-back packages that have been blocked twice by Senate Democrats.
“My view is the level at which the economy is improving further underscores that we need to do something at about the amount that we put on the floor in September and October. Highly targeted at what the residual problems are,” McConnell told reporters.
He warned that the “dramatically larger” figure being pushed by Schumer and Speaker Nancy Pelosi (D-Calif.) is “not a place I think we’re willing to go.”
In a post-election setback for Democrats, McConnell is taking over the reins of any negotiations from Treasury Secretary Steven Mnuchin, according to GOP senators. The decision significantly shifts the dynamics because the administration, before the election, had indicated it could agree to $1.9 trillion or higher, while that figure was always dead in the water with Senate Republicans.
“I think Secretary Mnuchin has done a great job in a really tough assignment … but I think these negotiations are always better if the members are dealing directly with the other members,” said Sen. Roy Blunt (R-Mo.), a member of GOP leadership and a close ally of McConnell.
The stalemate comes as coronavirus cases are climbing across the country, with the United States setting new records for the number of cases per day. Some states have begun reimposing restrictions to try to limit the spread, sparking fears of another economic setback.
Federal Reserve Chairman Jerome Powell warned that the U.S. economy will likely need further support from Congress and the central bank even if a coronavirus vaccine becomes available by the end of the year.
“There’s going to be a probably a substantial group of workers who are going to need support as they find their way in the post-pandemic economy because it’s going to be different in some fundamental ways,” Powell said during a virtual appearance on a panel hosted by the European Central Bank.
Lawmakers had hoped that getting past the November election would dial down the political tensions and create the space to cut big end-of-the-year deals. The inability to get an agreement is frustrating senators in the chamber’s shrinking center.
“I think the best thing that could happen as far as speeding up the process would be for the Democrats to join us in passing the smaller Senate bill, and then go to conference like the good old days and work out the difference,” said GOP Sen. Susan Collins (Maine), who recently won reelection.
There are behind-the-scenes signs of progress on the other big lame-duck issue: funding the government. Senate Appropriations Committee Chairman Richard Shelby (R-Ala.) briefed Senate Republicans during a closed-door lunch this week and spoke with Pelosi.
“I had a nice talk with Speaker Pelosi yesterday about all this and we could go forward and you know cooperating. She said she’d like to get these bills done,” Shelby said.
Speculation has swirled that coronavirus relief could be merged with a bill funding the government. But progress isn’t happening, yet, on the coronavirus piece and lawmakers are being peppered with questions about if Trump would sign full-year funding bills on his way out the door.
Biden spoke with Schumer and Pelosi on Thursday about the need for a lame-duck coronavirus relief deal. Republicans argue that Democrats should cut a smaller deal knowing that they will have the White House after Jan. 20.
“I’ve used the analogy, it’s like, give me $200 bucks. …Why not just take $100? Why don’t they just take the five or $600 billion, and argue for more,” said Sen. Ron Johnson (R-Wis.).
Sen. Kevin Cramer (R-N.D.) added that neither side should “feel like they have a whole bunch of leverage” and put the prospects of getting a deal this year at “50-50.”
Some GOP senators say that any deal, in order to pass Congress by the end of the year, would likely have to be between $500 billion and $1 trillion — in other words significantly closer to the Republican price tag.
But Democrats are showing no appetite yet to accept a smaller figure, arguing that the coronavirus’s steep economic and health consequences demand a sweeping response.
“The McConnell approach is so disproportionate to the urgency of the crisis … We’re still not seeing any indication that the Republican leadership is really looking at anything that is really in the ballpark,” said Sen. Ron Wyden (D-Ore.).
Asked about accepting a smaller bill now and negotiating more next year, he added: “You have to have a chance to negotiate something that isn’t just disproportionate to the challenge.”
Biden and the party’s congressional leadership, in their talk, indicated that they wanted a lame-duck bill that would include items not envisioned in the GOP plan like more help for state and local governments and expanded unemployment benefits.
Pelosi, meanwhile, indicated that Democrats were in the same place that they were before the election, driving home that there hadn’t been movement toward an agreement.
“We’re at the same place. Even more so,” Pelosi said, asked if their position hadn’t changed.
That leaves lawmakers, at least at the start of the lame-duck, without a clear path to an agreement this year.
Asked about the larger figure being floated by Democrats, Shelby added, “that’s not going anywhere.”