U.S. stimulus talks remain on life support after the House passed a Democrat-only $2.2 trillion package that did nothing to bridge the gap with Republicans.
The 214-207 vote, which garnered no GOP support, followed the most concerted talks between the top negotiators since early August. House Speaker Nancy Pelosi told reporters Thursday evening that she would review documents that Treasury Secretary Steven Mnuchin had sent her to determine where to go next.
How the talks might be affected by President Donald Trump’s announcement early Friday that he had tested positive for Covid-19 is uncertain. The Treasury said Friday morning that Mnuchin tested negative. He’s been advised that he need not quarantine, based on limited contact with Trump, according to a person familiar with the matter.
Pelosi and Mnuchin held multiple phone calls Thursday after meeting in person at the Capitol on Wednesday, amid rising pressure from a wave of job-cut announcements by large companies. “We are going back and forth with our paper,” Pelosi said Thursday, underscoring the importance of the language used in any deal.
Eighteen Democrats, most from swing districts, voted against the bill, arguing that passage would hinder efforts to find a bipartisan solution.
The talks have so far failed to resolve what’s been a difference of hundreds of billions of dollars between the two sides. Sharp disagreements also remain on components of coronavirus relief, with the Trump administration rejecting the scale of aid Democrats want for state and local authorities, and Pelosi demanding the end of tax breaks she says are devoted to the wealthy.
Pelosi said the House’s vote on its own bill would help present in a more public way what Democrats are unified in “pushing for” in the negotiations. Republicans in the Senate, where they have a majority, attempted to pass their own package last month -- a $650 billion plan, nicknamed the “skinny” package, that was blocked by Democrats.
Clock Ticking
With the presidential and congressional elections 32 days away and Congress expected to go on recess beforehand for the final leg of the campaign, time is running short. Private economists have already cut their growth forecasts for the fourth quarter after the failure to find a compromise on another fiscal package.
Economic data are already showing the fading impact of the $2 trillion stimulus enacted in March. Americans’ incomes fell in August by the most in three months after the government’s supplemental unemployment benefits expired, a report showed Thursday.
Although Trump and his aides have continued to express confidence in the recovery, major companies have announced job cuts in recent days. Walt Disney Co. said Tuesday it’s slashing 28,000 workers, American Airlines Group Inc. said Wednesday night it would begin to furlough 19,000 employees and United Airlines Holdings Inc. is planning to cut more than 13,000.
“People say we should have a skinny package -- no, we don’t have a skinny problem. We have a massive problem,” Pelosi said on the House floor Thursday.