House passes bill to avert shutdown
WASHINGTON » The House passed a two- day stopgap spending bill Friday night to avert a partial government shutdown, trying to buy time for frustratingly slow endgame negotiations on an almost $1 trillion COVID-19 economic relief package. Senate action wasn’t guaranteed but appeared likely before the midnight deadline.
The House passed the temporary funding bill by a 320-60 vote as frustrated lawmakers headed for a weekend session.
Senate Majority Leader Mitch McConnell, R-Ky., said early in the day he was “even more optimistic now than I was last night,” but Democrats launched a concerted campaign to block an effort by Republicans to rein in emergency Federal Reserve lending powers. They said the GOP proposal would deprive President- elect Joe Biden of crucial tools to manage the economy.
Believing a deal could be reached Friday “would be a triumph of hope over experience,” said a downbeat No. 2 Senate Republican, John Thune of South Dakota.
Funding for the government was to lapse at midnight, and a partial, low-impact shutdown would ensue if Congress failed to pass the stopgap spending bill. All essential federal workers would remain on the job, and most government offices would be closed on the weekend anyway.
The two-day stopgap bill could be stopped by a single senator voicing an objection, but the most likely Republican to do so, Josh Hawley of Missouri, announced he would not block the measure after receiving assurances that direct payments for individuals were included in the broader measure.
Democrats came out swinging at a key obstacle: a provision by conservative Sen. Pat Toomey, R-Pa., that would close down more than $400 billion in potential Federal Reserve lending powers established under a relief bill in March. Treasury Secretary Steven Mnuchin is shutting down the programs at the end of December, but Toomey’s language goes further, by barring the Fed from restarting the lending next year, and Democrats say the provision would tie Biden’s hands and put the economy at risk.
“As we navigate through an unprecedented economic crisis, it is in the interests of the American people to maintain the Fed’s ability to respond quickly and forcefully,” said Biden economic adviser Brian Deese. “Undermining that authority could mean less lending to Main Street businesses, higher unemployment and greater economic pain across the nation.”
The key Fed programs at issue provided loans to small and mid-sized businesses and bought state and local government bonds, making it easier for those governments to borrow, at a time when their finances are under pressure from the pandemic.
The Fed would need the support of the Treasury Department to restart the programs, which Biden’s Treasury secretary nominee, Janet Yellen, a former Fed chair, would likely provide. Treasury could also provide funds to backstop those programs without congressional approval and could ease the lending requirements. That could encourage more lending under the programs, which have seen only limited use so far.
The battle obscured progress on other elements of the hoped-for agreement After being bogged down for much of Thursday, negotiators turned more optimistic, though the complexity of finalizing the remaining issues and drafting agreements in precise legislative form was proving daunting.
The central elements appeared in place: more than $300 billion in aid to businesses; a $300-per-week bonus federal jobless benefit and renewal of soon-toexpire state benefits; $600 direct payments to individuals; vaccine distribution funds and money for renters, schools, the Postal Service and people needing food aid.
Lawmakers were told to expect to be in session and voting this weekend.