Stimulus deal negotiations on Saturday face government shutdown deadline

Stimulus deal negotiations on Saturday face government shutdown deadline

“It’s not a detail; it’s a very significant difference,” she said.

Immense pressure is bearing down on top congressional leaders to complete an agreement eight months after they last acted to aid a country ravaged by covid-19. Virus deaths are at all-time highs; unemployment claims are rising; and rank-and-file lawmakers are clamoring for action after months of false starts.

The approaching Christmas holiday, a looming pair of Senate special elections in Georgia and the prospect of a partial government shutdown are all acting to push negotiators toward finalizing a deal this weekend.

Congressional leaders have given themselves until Sunday midnight to close out talks. President Trump signed a two-day extension of federal appropriations Friday night, hours before a partial government shutdown would have started.

Publicly, top leaders struck an upbeat note.

“We’re going to get there,” Senate Majority Leader Mitch McConnell (R-Ky.) said Friday evening.

But privately, according to multiple lawmakers and aides monitoring the talks but not authorized to speak about them publicly, several thorny issues have yet to be hashed out.

Lawmakers have yet to resolve eligibility for small business relief; how to structure unemployment aid; and the criteria for sending out a $600 per person stimulus check. Pelosi also told House Democrats on a call on Saturday that lawmakers remained divided over the amount of money necessary for food assistance, according to a person granted anonymity to share her private remarks.

However, many aides close to talks expressed optimism these issues could be resolved fairly quickly if other sticking points are resolved.

Sen. John Thune (R-S.D.), the No. 2 ranking Republican senator, said Saturday that the “probably more likely scenario” is that negotiations stretch into Monday. “But I think we’re in the homestretch, we’re on the glide path,” Thune said. “I think we’re going to get this done and help out the American people.”

No issue has proven more nettlesome in the 11th hour than a Republican proposal, authored and promoted most vigorously by Toomey, that would ensure that the Federal Reserve could not continue emergency lending programs for small- and medium-sized businesses as well as state and local governments past Jan. 1.

Treasury Secretary Steven Mnuchin told Senate Republicans on a 1 pm call on Saturday that Toomey’s demands remained an open question, one person familiar with the internal call said. Most GOP lawmakers on the call were largely supportive of Toomey’s efforts.

Republicans say those programs, initially funded with a $500 billion congressional appropriation under the March relief bill, were of marginal utility earlier in the pandemic and are no longer necessary in any case.

But Democrats have cast it as a naked attempt to tie the hands of the incoming Biden administration as it tries to manage the ongoing economic fallout from the pandemic. They have also argued it represents an unusual political intervention into the independence of the Federal Reserve, limiting emergency lending powers it has possessed since 1932.

Toomey called the measure a “bright red line” for Republicans in the ongoing negotiations, while Democrats have called it a “poison bill” guaranteed to impede a deal. Aides in both parties said the issue is the biggest hurdle to a deal.

Senate Minority Leader Charles E. Schumer (D-N.Y.) said Saturday that Toomey’s proposal remains the “only significant hurdle to completing an agreement,” an assessment widely shared among Democrats. Schumer also said that Federal Reserve Chair Jerome H. Powell opposes the proposed changes.

“We’re close to an agreement … We need to finalize it and only really the Toomey provision stands in the way,” Schumer said.

Lawmakers appeared to dig in deeper over the disagreement as talks continued on Saturday. Sen. John Neely Kennedy (R-La.), a member of the Senate Banking Committee, said Democrats were trying to use the central bank’s authorities “as a backdoor to do what they couldn’t do through the front door.” He said of Republicans: “I think we ought to stand firm” on the issue.

But Sen. Elizabeth Warren (D-Mass.), also a member of the Senate Banking Committee, called Toomey’s proposal “terrible” and said both Powell and other members of the Federal Reserve opposed it.

“This provision has no place … in the bill we are doing now,” Warren now. “Democrats should stay firm, and I believe they will on behalf of the American people and the American economy.”

Asked about the latest in negotiations, Sen. Richard J. Durbin (D-Ill.), the No. 2 ranking Senate Democrat, said: “Toomey, Toomey, Toomey.”

Democrats have signaled they might be willing to accept language that restricts use of Treasury funds appropriated under the March aid bill, but not language that would restrict the Fed from doing similar lending using its own assets.

“I think we could go with one part and not the other,” House Majority Leader Steny H. Hoyer (D-Md.) said Friday. “And that’s the deal I think we ought to make.”

Hoyer told House members Friday not to expect votes until 1 p.m. Sunday at the earliest — just 11 hours before the next shutdown deadline. House Democratic leaders have scheduled a noon videoconference Saturday to update members on the negotiations.

Likely to run many hundreds of pages, the package is not only expected to carry the $900 billion covid relief deal but also $1.4 trillion in year-long appropriations for federal agencies; the extension of tens of billions of dollars in expiring tax breaks; a bipartisan energy bill; a long-delayed bipartisan solution to surprise medical billing; and dozens of other potential add-ons that a vast corps of lobbyists and congressional aides are hoping to include in this last legislative vehicle of 2020.

Lawmakers will almost certainly be asked to vote on a sweepingly broad piece of legislation with only hours to review it.

McConnell said Saturday that Congress cannot go home for Christmas without finishing a deal but added: “Unless we’re careful, any major negotiation can easily slide into an unending catalogue of disagreements. Let’s guard against that,” he said.

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