House Speaker Nancy Pelosi, D-Calif., said Friday she has offered to cut the pricetag of Democrats’ coronavirus relief bill by $1 trillion, but Treasury Secretary Steven Mnuchin dismissed the offer as “a non-starter” as both sides struggled to restart stalled talks.
The Friday afternoon meeting with Pelosi, Mnuchin, Senate Minority Leader Charles Schumer, D-N.Y., and White House chief of staff Mark Meadows came a day after a three-hour negotiating session ended with much finger-pointing but no deal.
Ahead of the meeting, Pelosi and Schumer held a press conference to announce publicly that they’d offered to reduce the pricetag of their $3.4 trillion bill by $1 trillion—mostly by limiting the duration of certain benefits such as nutrition and utility aid—if Republicans added $1 trillion to their $1 trillion starting offer.
The response from Meadows and Mnuchin, according to the Democrats, was “‘Absolutely not.'”
Mnuchin seemed to confirm that as he headed into Friday’s meeting, telling reporters of a $2 trillion proposal: “That’s a non-starter.”
But Schumer insisted that Democrats in the House and Senate would not accept anything less than $2 trillion—seeming to leave no path for a deal even as 30 million jobless Americans have now gone two weeks without emergency federal unemployment benefits that have expired.
Before the meeting started, Schumer and Pelosi heaped insults on Republicans in general and Meadows in particular, in comments that did not seem designed to engender fruitful negotiations.
“Basically what’s happening is Mr. Meadows is from the Tea Party … and they don’t want to spend the necessary money,” Schumer said of the former North Carolina congressman who was a leader of a faction of anti-spending rabblerousers when he served in the House.
Pelosi said for the second day in a row that Republicans don’t give “a damn” about people in need.
For their part, Republicans accused Democrats of trying to get a political outcome instead of a deal with the election approaching.
“Rather than be part of the solution, they have chosen to be part of the problem,” Sen. John Cornyn, R-Texas, said on Twitter on Friday.
Both sides in the talks appeared to be posturing amid growing confusion about what happens next. They have already missed several deadlines and emergency benefits and eviction protections for millions of Americans expired at the end of July. President Donald Trump has threatened repeatedly to try and bypass Congress.
White House adviser Larry Kudlow said Friday that Trump is poised to sign executive orders deferring payroll taxes and taking other steps to address the weak economy if there’s no deal with congressional Democrats.
“People should not believe the president is bluffing on using his executive authority. He is not bluffing,” Kudlow said in an interview on Fox Business. “And since we can’t seem to get a deal done with the other team right now, he will take his executive authority to the fullest.”
A positive jobs report Friday morning appeared to harden the administration’s posture, with Kudlow pointing to the 1.8 million jobs added in July as evidence of a “self-sustaining recovery.”
With millions still unemployed, however, Pelosi and Schumer insisted more relief is needed.
“Millions of Americans are still hurting and yet, despite this reality, President Trump and Republicans appear ready to walk away from the negotiating table to do unworkable, weak and narrow executive orders that barely scratch the surface of what is needed to defeat the virus and help struggling Americans,” the two said in a statement.
Trump and White House officials have been eyeing the possibility of unilateral action all week, and Kudlow confirmed Friday that they were looking at “repurposing” hundreds of billions of dollars that have not yet been spent from earlier coronavirus relief legislation passed this spring.
The legality of such a move is questionable, with Democrats insisting the White House can’t spend money without Congress’ approval. But Trump has pushed the boundaries of executive authority in the past, including his move to declare a national emergency at the U.S.-Mexico border so he could raid Pentagon funds to build his wall.
It’s unclear to what degree Trump could move on his own to restore emergency unemployment benefits that were authorized by Congress in March and then expired at the end of July. Kudlow said the executive actions under consideration include moves to “reform unemployment” by providing a benefit for re-employment and a retention tax credit for employers.
He said Trump also intends to extend a lapsed moratorium on evictions, a move Democrats have encouraged even while saying it has little value without funding for rental assistance attached. The moratorium, which expired last months, covers renters who live in homes with federally backed mortgages, which the Urban Institute estimates to be 12.3 million households.
Cutting the 7.65% payroll tax, which comes out of workers’ salaries and goes to fund Medicare and Social Security, has been a longstanding goal for Trump. Lawmakers in both parties question the value of such a move, partly because it would do little to help workers who are not actually employed. In recent days, White House officials have not been clear as to whether Trump believes he has the power to unilaterally defer the tax or actually cut it.
Mnuchin, Meadows, Schumer and Pelosi have had multiple lengthy meetings over the past two weeks, only to come up empty-handed on a deal.
Meadows was less definitive than Mnuchin in rejecting the Democrats’ offer as he spoke briefly to reporters ahead of Friday’s meeting, but he questioned Pelosi’s math in saying she was offering to cut $1 trillion from the Democrats’ bill.
“I don’t know that that’s a reduction as much as she’s just changing the time-frames so I don’t think she’s come off of her number other than just made a shorter time-frame,” Meadows said.
“It depends on where it all comes from,” Meadows added, when asked if the approach was feasible
Democrats have been pushing for a wide-ranging $3.4 trillion bill the House passed in May, which extended the enhanced $600 weekly unemployment benefits through January, among many other provisions. Republicans are reluctant to spend more than $1 trillion after already signing off on about $3 trillion in stimulus for the economy and support for the health care system this spring—an unprecedented sum.
In a letter to fellow House Democrats on Friday, Pelosi said that progress had been made on some matters but that the two sides remained far apart on others, including aid to states and localities. Democrats want $915 billion to help states and local governments whose budget have been decimated by plummeting tax revenue, but Republicans have offered only $150 billion.
There’s also disagreement on money for schools, testing, housing, childcare, the postal service, the Census, and voting.
Pelosi insisted in an interview on MSNBC that Democrats would not agree to a narrow deal just to address the expired unemployment benefits, something Republicans have been pushing.
“No, no, no, no. Not open to a short-term deal. That’s an excuse [for Republicans to say] we’ve done what we’re going to do, we wash our hands,” Pelosi said.
Pelosi defended the Democrats’ approach, insisting they were pushing for legislation addressing the real needs in the country.
“We haven’t overplayed our hand,” Pelosi said. “We aren’t overplaying our hand when we are factually presenting what the needs are.”