The number of coronavirus cases is surging, and congressional leaders are squabbling. It’s an ominous foreshadowing of the coming partisan clash over the next relief package.
Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Mitch McConnell (R-Ky.) are straddling opposite sides of a multi-trillion dollar divide, with neither currently willing to budge.
Congressional leaders from both parties privately believe they’ll reach a deal at some point: the stakes are too high for the nation’s health and economic well-being, not to mention Election Day is quickly approaching. But it may take several weeks of difficult negotiations — and public posturing — to strike an accord.
Senate Republicans are expected to unveil their own roughly $1 trillion proposal next week, a plan far narrower than the $3 trillion-plus bill pushed through the House by Democrats two months ago. Apart from cost, the parties are still far apart on key issues, including whether or how to extend a boost in unemployment insurance benefits set to expire in the coming days.
McConnell and Pelosi haven’t even begun private conversations about the fifth relief package, according to sources close to both offices. Instead, the two leaders used separate press events Wednesday to highlight their conflicting positions.
During public remarks in Cynthiana, Ky., McConnell said he’d spoken to Treasury Secretary Steven Mnuchin Wednesday morning and would likely offer a proposal next week for discussion with his GOP colleagues and Democrats. McConnell is insisting that any next package prioritize liability protection for employers, a demand he’s been making for weeks to Democratic frustration. Senate Republicans are also eyeing providing financial incentives for schools to fully reopen.
“I expect to begin to lay out to my colleagues in the Senate a proposal,” McConnell said. In addition to liability provisions, “kids in school, jobs and healthcare are likely to be the focus of the bill.”
A few hours later Wednesday, Pelosi sought to claim an initial victory by arguing Republicans have significantly shifted their thinking since calling for a “pause” when the House passed its bill in May. But the California Democrat also made clear what McConnell is proposing right now isn’t nearly good enough.
“There’s a recognition that there’s going to be a bill,” Pelosi told reporters. “They went from zero to now $1.3 [trillion]. That’s not enough, we need more. But we see the public evolution of their thinking.”
Pelosi said Democrats’ behemoth bill largely doesn’t need to be adjusted, even as coronavirus cases have skyrocketed in a majority of states over the last month. But Democrats might make a push for extra education money in current talks as President Donald Trump continues to demand schools reopen in the fall.
“We put our marker on the table. It’s very disciplined, it’s nothing more than we need,” Pelosi said. “Although, I must say we may need more for education now that the president is making the demand that he is making.”
While Congress has already pumped more than $2.5 trillion in coronavirus relief into the economy via four bills — including a giant $2 trillion rescue package in March — McConnell has acknowledged that another bipartisan deal will be harder to reach given the political climate.
With 111 days until the election, McConnell must govern a divided caucus, with a number of Senate Republicans shunning additional government spending while vulnerable members up in 2020 are pleading to get something done before the August recess.
Both parties know that the forthcoming coronavirus package is likely to be the last before the November election, increasing pressure to squeeze in demands before going home to campaign amid a pandemic-induced recession.
“If McConnell has any hope of hanging onto his majority, he’s got to show leadership and responsiveness and he can’t do that by writing a Republican only bill,” said Sen. Chris Coons (D-Del.) “We’re going to have to find bipartisan answers to these issues.”
Senate Democrats have spent weeks criticizing McConnell for not acting sooner. During a caucus call this week, Senate Minority Leader Chuck Schumer (D-N.Y.) told members that there’s been no outreach yet from McConnell and insisted that Senate Democrats will only negotiate if House Democrats are involved, according to a source on the call.
“Senator McConnell ought to be working across the aisle to prevent mass evictions, a new hunger crisis, and the layoff of more essential state and local government employees — all things that will happen if Republicans continue to delay action or act stingily,” Schumer warned in a statement to POLITICO.
One Senate Republican aide seemed stunned that his own party was blocking more coronavirus relief spending just over 100 days from an election where the majority is clearly in jeopardy and the economy is weak.
“It’s usually the minority that is blocking bills before an election, not the majority,” complained the aide. “It’s like they’re offering us cake, but we say, ‘No, we want the broccoli.'”
But Senate GOP leaders argue that much of the money allocated in the March CARES Act has yet to be spent and they want the next package to be more targeted.
While McConnell has told colleagues he wants to keep the price tag for the package at around $1 trillion, some in his caucus are open to spending more if needed.
In an interview, Sen. Lindsey Graham (R-S.C.) predicted that the next package would “probably not” be as large as the $2 trillion CARES package. But Graham added that he wants to “go big” and consider proposals like infrastructure or a payroll tax cut, both of which appear to have limited support in the GOP caucus.
“What’s different with Phase 4 and Phase 3? Phase 4 needs to be about jumpstarting the economy, building on the momentum of going back to work,” Graham said. “Phase 3 was a rescue package, Phase 4 needs to be a stimulus package.”
In a sign of the difficulties facing Congress, lawmakers can’t even agree what round of relief they are currently negotiating. Some classify the last $484 billion relief bill passed in April as only an “interim” measure and describe the current talks as “phase 4.” Other members refer to this round as “phase 5” because it will be the fifth coronavirus-focused bill.
Among the key sticking points will be addressing the extra $600 in weekly unemployment benefits in the March CARES Act. Democrats want to see those benefits extended and are suggesting tying unemployment benefits to economic conditions. Senate Republicans, however, say the increase in unemployment benefits provide a disincentive for people to return to work.
A potential compromise could center around “return to work” incentives. Regardless, the additional benefits for most people are likely to lapse, at least temporarily, before a deal gets struck. While the March law authorizes the extra benefits through the end of the month, the money will effectively stop being paid out on July 25 under the way most state unemployment systems are set up.
House Democrats are also pushing for a boost in food aid, another round of stimulus checks to individuals and nearly $1 trillion in state and local assistance — non-starters for most Senate Republicans.
Adding to the uncertainty is what message the White House will send up to the Hill. Trump is making reopening schools a key focus, even going so far as to suggest that he’d withhold federal funds from schools that failed to reopen — a threat that has outraged Democrats.
Sen. Roy Blunt (R-Mo.) said in an interview that he wants to see schools re-open, but he noted “the expenses of school don’t go away because you’re teaching at a distance, as opposed to teaching in a classroom.”
Blunt, who is also working with Sen. Patty Murray (D-Wash.) on bills to fund the government for the next fiscal year, added that “100 days before a presidential election almost everything is a political sticking point.”