Democrats reject ‘skinny’ virus plan while GOP struggles for unity

Both parties skeptical of scaled-back relief bill, but time is running short

Mark Meadows, center, White House chief of staff, and Treasury Secretary Steven Mnuchin, leave Dirksen Building after the Senate Republican Policy luncheon on Tuesday, July 28, 2020. (Tom Williams/CQ Roll Call)
Mark Meadows, center, White House chief of staff, and Treasury Secretary Steven Mnuchin, leave Dirksen Building after the Senate Republican Policy luncheon on Tuesday, July 28, 2020. (Tom Williams/CQ Roll Call)
Posted July 29, 2020 at 11:24am, Updated at 6:46pm

Congressional leaders and the Trump administration remained at a standstill on COVID-19 aid negotiations Wednesday despite the U.S. hitting a grim milestone with 150,000 deaths and millions out of work.

House Speaker Nancy Pelosi and Senate Minority Leader Charles E. Schumer met with Treasury Secretary Steven Mnuchin and White House Chief of Staff Mark Meadows for the third day in a row on Capitol Hill, though neither side appeared to move closer together in talks over a trillion-dollar aid package.

"We're still very far apart on a lot of issues," Mnuchin said after leaving an hour-long meeting in the speaker’s office during the afternoon. "I do think there is a subset of issues that we do agree on, but overall we’re far from an agreement."

Mnuchin said there are areas like a second round of Paycheck Protection Program forgivable loans, education funding to help schools safely reopen and worker retention tax credits for hard-hit businesses where the two sides can come together. They will have a more challenging time negotiating a compromise on unemployment insurance, state and local assistance and liability protections for businesses, Mnuchin said.

Earlier in the day, Mnuchin and President Donald Trump had said in lieu of a broader deal, they were focused on at least renewing expanded unemployment benefits and a moratorium on evictions from federally backed housing that lapsed over the weekend.

'We're not accepting that'

Democrats were unified in their opposition to a slimmed down package, however.

“We don’t know why the Republicans come around here with a skinny bill that does nothing to address, really, what’s happening with the virus,” Pelosi said after the meeting. “We're not accepting that. We have to have the comprehensive full bill.”

Schumer argued there are too many urgent problems caused by the virus to only address one or two.

“This is the greatest economic crisis we've had in 75 years, the greatest health care crisis in 100 years, and our Republican friends don’t come close to meeting the moment,” Schumer said.

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Pelosi also pointed to comments made earlier in the day by Federal Reserve Chairman Jerome Powell, who said the “current economic downturn is the most severe in our lifetimes.”

“It will take a while to get back to the levels of economic activity and employment that prevailed at the beginning of the year, and it will take continued support from both monetary and fiscal policy to achieve that,” Powell said.

Mnuchin said earlier that time was running short and it might make sense to pivot to areas both sides can agree on.

"We're looking at a deadline obviously of this Friday. The president's very focused on evictions and unemployment, and if we can't reach an agreement by then, the president wants to look at giving us more time to negotiate this," Mnuchin said as he joined Trump for the president's departure from the White House on Wednesday morning.

"We're focused on those two things, we want to take care of them now, the rest we can discuss later," the president said with Marine One in the background. "They want big bailout money for Democrats that ran cities terribly. Their cities are going down the tube."

The president referred to situations involving protesters in both Portland and Seattle, as well as the crime rate in New York City, as reasons he was against a broad aid package for state and local governments, which Democrats have prioritized.

Democrats have pushed for a blanket renewal of the $600 added weekly benefit that lapsed this week, while Republicans want to cut that figure to $200 through September and then provide some amount that allows each state's claimants to receive benefits worth 70 percent of prior wages.

Republicans involved in the talks declined to specify what a short-term proposal would look like.

Meadows specifically sought to deflect blame away from Trump for any expiration of the federal unemployment add-on, while also declining to say whether the White House would support extending the $600 amount temporarily to avoid a lapse.

"At the end of the day I will say if enhanced unemployment expires, it will not be because of Senate Republicans and the president of the United States," he said

On the Senate floor Wednesday, Majority Leader Mitch McConnell blasted Pelosi for not being willing to budge on $600, which Republicans argue is too high and discourages a return to work.

"That’s what Speaker Pelosi apparently signaled yesterday: No money for schools, no money for households, no second round of the [Paycheck Protection Program], no more money for hospitals or testing, nothing at all unless we continue to pay people more not to work," McConnell said. "That is a completely unhinged position."

Democrats also want $915 billion in direct aid to states and localities; Senate Republicans this week offered zero, though they said $105 billion in education aid in their package should help plug one of states' biggest budget holes. McConnell has also said liability projections for businesses, schools and health care providers was a must in exchange for any direct aid to states and localities.

'No consensus on anything'

Republicans have little unity on their proposals for mitigating the short- and long-term impacts of the pandemic.

Leaving a GOP lunch Wednesday, Sen. John Cornyn, R-Texas, said there was “no consensus on anything." Meadows later characterized the discussions as “diversity of opinions on what actually should be the final product and an equally diverse number of opinions on what the starting point should be.”

Members of both parties have also generally been skeptical about a "skinny" bill that accepts some areas of common ground and leaves more divisive items for later.

Senate Finance Chairman Charles E. Grassley, R-Iowa, said he’s opposed, at least for now.

“I sure don't want to, but there's a couple crisis things that are coming up here,” he said, listing unemployment insurance and the eviction moratorium.

Sen. Roy Blunt, R-Mo., said he hasn’t seen any short-term deal that could get McConnell’s support or the number of bipartisan votes needed to pass the Senate.

“I haven’t heard that deal described yet that the leader would put on the floor,” Blunt said.

McConnell insisted Wednesday evening that it was still early.

"Many things around here happen at the last minute," McConnell said on the PBS Newshour. "This is only Wednesday, so hope springs eternal that we'll reach some kind of agreement either on a broad basis or a more narrow basis to avoid having an adverse impact on unemployment."

In Wednesday's impromptu driveway remarks, Trump was also asked about the inclusion of $1.75 billion for a new FBI headquarters complex in the Appropriations Committee portion of the Senate Republican COVID-19 proposal.

"We have that in the bill. It should stay," Trump said. "People have wanted a new FBI building now for 15 or 20 years."

Even Senate Republicans who agreed to include the provision have since backed away from it, however.

The president, who made his name in real estate, had a message for them.

"Republicans should go back to school and learn. You need a new building. It's a bad building. It's a dangerous building, you have slabs falling off," Trump said. "I would make sure we build a great building at a fraction of the cost."

Jim Saksa and David Lerman contributed to this report.