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Democrats turned to a provision by Conservative Sen. Pat Toomey, R-Pa., On Friday that would end more than $ 400 billion in potential Federal Reserve lending powers established under a bill of relief in March. Pelosi told reporters on Saturday that language negotiations were the biggest remaining hurdle.
“We’ve had this big problem, a last, sort of minute thing with Mr. Toomey. And that has to be fixed. And then it’ll all fall into place. But that’s the big deal. And that’s what’s harmful. to our economy, and postpone a deal on it, ”Pelosi told reporters as he entered the Capitol.
This is a last minute update. A previous version of this report is available below.
The Fed programs at issue have provided loans to small and medium-sized businesses and purchased government and local government bonds, making borrowing easier for these governments at a time when their finances are under pressure. the pandemic.
Negotiators on Saturday reported continued progress on a nearly $ 1 trillion COVID-19 economic relief plan, with growing optimism that overdue talks would soon result in a deal. The Senate called a session on Saturday, while House members held to a vote that will arrive no earlier than Sunday.
A new government shutdown at midnight Sunday served as a safety net for the tortuous negotiations, which were conducted in largely secret among the four main leaders of the warring tribes on Capitol Hill.
A key negotiator said the talks are continuing in good faith.
“But the American people cannot feed their families or pay their bills with the good faith talks in Congress,” said Majority Leader Mitch McConnell, GOP faction leader in the Senate. “We need to conclude our discussions, draft a bill and land this plane.”
The massive package would wrap much of Capitol Hill’s unfinished business for 2020 in a take it or leave it monster that promises to be a foot thick or more. House lawmakers will likely only have a few hours to study it before voting as early as Sunday afternoon. A Senate vote would follow, and another interim financing bill will likely be needed to avoid a midnight Sunday shutdown.
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The House passed Friday’s interim finance bill by a 320-60 vote. The Senate approved it by voice vote almost immediately after, and President Donald Trump signed it on Friday night.
McConnell did not provide an update on the talks, but an outstanding issue involves an effort by Republican conservatives to curb the Federal Reserve’s emergency lending powers. Democrats have said the GOP proposal would deprive President-elect Joe Biden of crucial tools to manage the economy.
An agreement in principle on Saturday would be a precursor to more hours of translating compromises into detailed legislation. Lawmakers are eager to leave Washington and end a tumultuous year.
House lawmakers have been told they won’t have to show up for work on Saturday, but a Sunday session is likely. The Senate will vote on the nominations on Saturday.
The $ 900 billion package comes as the pandemic produces its most formidable wave to date, killing more than 3,000 victims a day and straining the country’s healthcare system. Although the vaccines are on their way, most people will not get them for months. Unemployment claims are on the rise.
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The emerging deal would provide more than $ 300 billion in business assistance and provide the unemployed with a federal unemployment premium of $ 300 per week and the renewal of state benefits that would otherwise expire just after Christmas. It also includes direct payments of $ 600 to individuals; vaccine distribution fund and cash for tenants, schools, postal service and people in need of food assistance.
On Friday, Democrats turned to a provision by Tory Sen. Pat Toomey, R-Pa., That would end more than $ 400 billion in potential Federal Reserve lending powers established under a bill of relief in March. Treasury Secretary Steven Mnuchin is ending programs in late December, but Toomey’s language goes further, preventing the Fed from restarting lending next year.
“As we go through an unprecedented economic crisis, it is in the interests of the American people to maintain the ability of the Fed to respond quickly and forcefully,” said Brian Deese, economic adviser to Biden. “Undermining that authority could mean fewer loans to Main Street businesses, higher unemployment and greater economic hardship across the country.”
The Fed programs at issue have provided loans to small and medium-sized businesses and purchased government and local government bonds, making borrowing easier for these governments at a time when their finances are under pressure. the pandemic.
The Fed would need support from the Treasury Department to restart programs, which Biden’s Treasury Secretary candidate Janet Yellen, a former Fed chair, would likely provide. The Treasury could also provide funds to support these programs without Congressional approval and could ease loan terms. This could encourage more loans under the programs, which have been used only to a limited extent so far.
The pending bill is the first major legislative response to the pandemic since the landmark CARES law was passed virtually unanimously in March, providing $ 1.8 trillion in aid, plus $ 600 a week in bonus jobless benefits and $ 1,200 in direct payments to individuals.
The measure largely follows a pattern established by a bipartisan group of senators and a team of House pragmatists. But the top leaders are firmly in charge, although relations are battered by months of war.
The COVID-19 package would be added to a $ 1.4 trillion government-wide appropriation bill that would fund federal agencies until next September. This move is likely to provide a final installment of $ 1.4 billion for Trump’s border wall between the United States and Mexico as a condition of earning his signature.
For Republicans, the most important aid provision for COVID-19 was a second round of long-sought ‘paycheck protection’ payments to particularly affected businesses and the renewal of state unemployment benefits which expiring soon for the long-term unemployed.
Democrats were denied direct tax relief for states and local governments, a top priority, and they got additional COVID-19 unemployment benefit that was only half of what the CARES law offered. Democrats also won $ 25 billion to help struggling tenants with their payments and $ 45 billion for airlines and transit systems, but some left-wing critics said Democratic negotiators were backing down. shirk.
Indeed, McConnell has occupied the catbird seat since Senate Republicans surpassed expectations in November when House Democrats barely held their majority. Pre-elections Democrats’ demands for a bill exceeding $ 2 trillion were quickly cut by more than half. Still, Biden is pushing for a deal, fearing a weakening economy awaits him on inauguration day.
Biden promises another bill next year, but if Democrats lose the Georgia Senate second-round election next month and fail to win a majority in the Senate, they may have little weight. Conversely, GOP leaders are privately saying that delivering an aid bill may help their incumbent candidates in the January run-off, GOP Senators Kelly Loeffler and David Perdue.
Most economists, including Federal Reserve Chairman Jerome Powell, strongly support further economic stimulus so necessary to keep businesses and households afloat during what is expected to be a tough winter. Many predict that the economy could contract in the first three months of 2021 without additional help. Standard & Poor’s said in a report on Tuesday that the economy would be 1.5 percentage points lower in 2021 without more help.
Copyright © 2020 by Associated Press. All rights reserved.
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