The Trump administration sees a possibility for Republicans and Democrats to agree on a smaller round of pandemic relief totaling $500 billion that would omit the biggest areas of disagreement, a senior U.S. official said on Tuesday night.
The official, who discussed the matter on the condition of anonymity, said that both parties might be able to reach an accord on issues like financial help for the Postal Service, aid to schools and more money for businesses to keep their workers employed.
That is far short of what Democrats want.
Pelosi in the past has rejected such an approach. Yet she’s also getting some pressure from fellow Democrats to offer partial relief. Representatives Scott Peters of California, Donald Beyer of Virginia and Derek Kilmer of Washington State are seeking support from other members to ask Pelosi and Majority Leader Steny Hoyer for a vote on extending the $600 a week in extra unemployment aid that expired at the end of last month.
McConnell said in an interview with the Louisville Courier Journal Tuesday that the return of the House for the post office vote “could open the opportunity for discussion about something smaller than what the speaker and the Democratic Senate leader were insisting on at the point of impasse.”
Mnuchin, one of the two key Republican negotiators along with Meadows, said earlier Tuesday that with the House in session this weekend he hoped Pelosi “will be more interested in sitting down.”
Economic and financial-market news hasn’t put pressure on the two sides to accelerate an accord on coronavirus relief. The S&P 500 Index closed at a record high on Tuesday, hours after data showing an unexpectedly strong gain in starts on new home construction in July.
Even so, economists warn that the expiration of supplemental unemployment insurance benefits -- only partly addressed by unilateral, temporary action by President Donald Trump -- along with the end of other fiscal support will damage growth.
“It looks likely that the hit to disposable income from fiscal policy in August will only partially reverse in September unless Congress acts soon,” Goldman Sachs Group Inc. economists including Alec Phillips wrote in an Aug. 14 note. “While the situation is fluid and unpredictable, all else equal this presents a downside risk to our forecast for growth in Q3.”
--With assistance from Erik Wasson, Justin Sink and Todd Shields.
This article was provided by Bloomberg News.