US Congress closes in on $900bn Covid aid bill as Friday deadline looms
US congressional negotiators tampered on Thursday morning the growing optimism that they are closing in on a $900bn Covid-19 aid bill, alluding to “a few final issues” that need to be addressed before an agreement is made.
The stimulus bill is tied to Congress’ annual budget for most government agencies, which needs to be passed by Friday to avert a government shutdown.
Speaking on the Senate floor, the Senate majority leader, Mitch McConnell, said that it is “highly likely” negotiators will be working through the weekend to reach an agreement. He said it appears Congress will have to pass a stopgap bill, which will extend their funding deadline and prevent a shutdown.
“I hope we’ll extend it for a very, very short window of time,” he said, citing the urgency of a new stimulus package.
Earlier this week, leaders of both parties expressed optimism that negotiations were coming to an end. But on Thursday, both McConnell and the Senate minority leader, Chuck Schumer, suggested that the two sides still have disagreements that need to be resolved before moving forward.
“Many, if not all, difficult topics are behind us, a few final issues must be hammered out,” Schumer said. “We’ve very close to an agreement, but the details really matter.”
For months, Republicans have been gunning for a stimulus package with a much lower price tag than Democrats want. The two sides seem to have found common ground on a $908bn relief package – over $1tn less than the first stimulus package.
The legislation is expected to include stimulus checks of about $600, extend unemployment benefits, help pay for vaccine distribution and assist struggling small businesses.
The measure is set to be attached to a $1.4tn spending bill that must pass by Friday to avert a government shutdown. Two contentious issues appear to have been left by the wayside – it is not expected to include a dedicated funding stream for state and local governments, which has long been a Democratic priority but opposed by Republicans, or new protections for companies from lawsuits related to the pandemic, something high on the Republican agenda.
Senator John Thune, the Senate’s No 2 Republican, said the proposed direct payments to individuals would be around $600 to $700 a person.
Mark Ritacco, director of governmental affairs for the National Association of Counties, said some steps Congress could take to help local authorities include providing a oneyear extension of unused funds provided by the Cares Act, a Covid-19 relief bill enacted in March.
His organization also hopes Congress will expand the number of counties that can receive aid to include smaller counties, especially as they must administer the new vaccines. It suggested having the federal government replenish more local Covid-19 relief costs already partly reimbursed by the Federal Emergency Management Agency (Fema), such as personal protective equipment for schools and other government buildings.
But some Republicans are wary that having Fema pay more is a roundabout way of providing more state and local government aid.
“If it’s simply a way of disguising money for state and local governments, we’ll have a lot of opposition,” Thune said.
The negotiations come at a key moment for a US economy clearly weakening after an initial rebound from recession triggered by the pandemic earlier this year. Consumer spending, buoyed through the summer and early fall by more than $3tn in federal assistance, has hit a wall as new lockdowns limit business activity and keep people home.
Another 885,000 Americans filed new claims for unemployment benefits last week, representing an increase of 23,000 from a week earlier. The number represents the highest weekly figure since September. Overall, more than 20.6 million Americans are now receiving unemployment benefits.
Economists say unemployment numbers are heading in an alarming direction as Americans prepare for the holidays amid more coronavirus-related layoffs.
A number of experts also said the data underscored the need for Congress to pass another coronavirus relief bill to aid Americans who are financially struggling.
Joe Biden said the stimulus package was encouraging but more aid would be needed.
“It looks like they’re very, very close, and it looks like there is going to be direct cash payments, but it’s a down payment – an important down payment – on what’s going to have to be done beginning at the end of January, into February,” the president-elect told reporters.
Commerce department data showed retail sales fell unexpectedly sharply in November, with consumer outlays on goods and services showing softness across the board.
The Federal Reserve on Wednesday promised to keep funneling cash into financial markets further into the future to fight the recession, even as policymakers’ outlook for next year improved following initial rollout of a coronavirus vaccine.