White House Return to Stimulus Talks Boosts Chance of a Deal

Treasury Secretary Steven Mnuchin made a surprise re-entry into talks on a 2020 pandemic-relief package with a $916 billion proposal that opened a potential new path to a year-end deal despite objections from Democrats over elements of the plan.

After largely leaving the task to Senate Majority Leader Mitch McConnell since Election Day, Mnuchin pitched a $916 billion stimulus plan to House Speaker Nancy Pelosi in a Tuesday afternoon telephone call, more than a week after she and Senate Democratic leader Chuck Schumer retreated from their previous insistence on a $2.4 trillion bill.

Mnuchin’s offer was a joint proposal supported by McConnell and House Republican leader Kevin McCarthy, who called it “a great offer.” Mnuchin said he had conferred with President Donald Trump, whose support will be needed to get any deal through the Republican-controlled Senate.

Pelosi and Schumer said in a joint statement that it marked “progress” because it brought McConnell closer to the $908 billion framework unveiled last week by a group of Democratic and Republican lawmakers. But they said its omission of supplementary jobless benefits was “unacceptable,” and backed the continuing bipartisan effort at crafting a compromise.

The Mnuchin plan differs in important ways from the alternative that Pelosi and Schumer endorsed as a basis for fresh talks. It includes $600 stimulus payments to individuals, which could win support from both Republicans and Democrats, but it pays for that in part through cutting the bipartisan proposal for $300 a week in supplemental unemployment aid.

Two Roadblocks

It also includes what Mnuchin described as “robust” protections for employers from Covid-19-related lawsuits, something Democrats have opposed. Negotiators on the bipartisan plan had been working on a proposed moratorium that offered potential for a compromise. It does have $160 billion in aid for state and local authorities, much the same as the bipartisan plan.

Mnuchin’s pitch ties state and local aid together with liability protections — the two key roadblocks to a deal so far — so they can either be removed or stay in together, according to McCarthy.

McConnell earlier Tuesday had floated the idea of setting aside those two issues, but Democratic leaders quickly rejected dropping aid to states and localities.

Meantime, the bipartisan group continued their own negotiations. Their work over the weekend and early this week on turning the plan into legislative language had slowed amid the persistent disagreements over state and local aid and the Covid-19 liability protections that McConnell in particular has championed.

Joint Approach

The Mnuchin offer, which was made to Pelosi in the 5 p.m. call, was essentially a joint proposal from the White House, McConnell and McCarthy.

That marks a turnaround for McConnell, who since the election has stuck with pitching a smaller-scale effort that Democrats had previously blocked. That focused mainly on renewed Paycheck Protection Program help for small businesses — something that’s in both Mnuchin’s and the bipartisan plan — education aid and funding for vaccine distribution and other Covid-19 initiatives.


While it is progress that Leader McConnell has signed off on a $916 billion offer based on the bipartisan framework, the President’s proposal, which cuts unemployment insurance by $140 billion compared to the framework, is unacceptable.1:57 AM · Dec 9, 2020


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Asked about Mnuchin’s plan, a spokesman for McConnell said the leader had no further remarks beyond his statement earlier Tuesday. But a person familiar with the matter said it represents a joint proposal supported by Mnuchin, McCarthy and McConnell.

Lawmakers from both parties have said that any Covid-19 relief deal would be attached to a government-spending bill. Current stopgap funding for federal agencies runs out Friday night, and the House plans to vote Wednesday on a new seven-day continuing resolution to avert a shutdown. The Senate aims to take that up thereafter.

Potential Timeline

That would give another week for talks to continue on both the stimulus front and on an omnibus spending bill to fund the government into 2021.

In his statement on Tuesday, Mnuchin said the $916 billion proposal would be financed using unspent appropriations from earlier stimulus bills. That includes $429 billion left over from the March stimulus, which provided for direct loans to companies and emergency lending programs through the U.S. Federal Reserve. Another $140 billion is left from the Paycheck Protection Program of small-business aid.

Read More: Mnuchin Says Congress Must Redirect $455 Billion, Not Biden

Democratic lawmakers in recent weeks criticized Mnuchin’s move to place the unused money for Fed programs in the Treasury Department’s general account, saying it was an attempt to hamstring the incoming Biden administration. Mnuchin argued that he was following the letter and spirit of the law. The bipartisan plan also uses the funds to pay for its spending.

— With assistance by Steven T. Dennis, and Billy House

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