US Senate majority leader Mitch McConnell. Picture: BLOOMBERG/SARAH SILBIGER
US Senate majority leader Mitch McConnell. Picture: BLOOMBERG/SARAH SILBIGER

Washington — White House chief of staff Mark Meadows said the goal in talks with House speaker Nancy Pelosi is a deal on a coronavirus relief package within the next 48 hours.

“The past 24 hours have moved the ball down the field,” Meadows said on Fox Business on Wednesday morning, after the latest round of talks between Pelosi and treasury secretary Steven Mnuchin. The goal is “some kind of deal in the next 48 hours or so”.

Mnuchin and Pelosi are scheduled to speak again on Wednesday afternoon. Any agreement still faces a roadblock in the Senate, however, with majority leader Mitch McConnell having warned the White House against agreeing to anything akin to Pelosi’s more sweeping proposal.

Pelosi said on Tuesday that an agreement with the Trump administration needs to be done by the weekend to get a bill passed by the end of next week, ahead of election day on November 3.

Even if the actual vote on a compromise has to wait until after the election, just announcing a deal before November 3 would be “very helpful to the economy and markets”, White House economic adviser Larry Kudlow said on Wednesday. “We’re moving closer,” he said on CNBC. “There’s a sense of optimism.”

Stocks opened higher with the negotiations continuing. The S&P 500 index was up 0.6% as of 10.14am.

“The negotiations have entered a new phase, which is more on the technical side of trying to get the language right if we can agree on the numbers,” Meadows said on Wednesday.

Senate Republicans, however, remain on an entirely different track. Former presidential candidate Mitt Romney added his voice to the number of GOP members saying they’d vote against anything on the order of $1.8-trillion. Mnuchin has put forward $1.88-trillion, while Pelosi wants $2.2-trillion.

Given the risk of a damaging public split in the party just days before they face voters, McConnell has warned the White House not to rush into an agreement before the election, according to a person familiar with the matter.

Meadows denied such a “warning” had been given, though did say on Tuesday that he recognised some Republican senators oppose another stimulus. He said he’d be speaking with GOP members on Wednesday, along with Mnuchin.

McConnell plans to seek a vote on a scaled-down package  on Wednesday — a manoeuvre he tried last month only to be blocked by Democrats insisting on a comprehensive bill.

The Senate Republican effort of $500bn includes items that both sides support, but is stripped of the elements many GOP members oppose — including large-scale assistance to state and local authorities, tax credits for working families and relief for airlines.

Timing question

McConnell said on Tuesday that his chamber would take up a comprehensive coronavirus stimulus package “at some point” if Pelosi and Mnuchin are able to resolve the final areas of disagreement and get a bill through the House. But he didn’t say whether he would support such a deal, or encourage GOP members to back it.

The Senate majority leader is focused instead on speeding confirmation of US Supreme Court nominee Amy Coney Barrett, with a potential vote expected early next week.

Meadows said on CNBC on Tuesday that if a deal does get done and through the House, “it will probably divide the Republican conference”. There are “some senators who really believe that we’ve done enough for the economy and want zero”.

Progress was made in recent days over a national coronavirus testing and tracing plan. Pelosi also said, in a Bloomberg TV interview on Tuesday, that she planned to bring a counter-offer to Mnuchin on a Republican push to provide businesses with liability protection against virus-related lawsuits.

Differences remain over issues including tax credits and state and local government assistance.

“The biggest issue remains state and local assistance,” Meadows said on Wednesday. While the administration estimates that those authorities have lost $250bn to $275bn in revenue thanks to the Covid-19 crisis, Pelosi is seeking aid of “about twice that number” or closer to $500bn, he said.

Meadows suggested a compromise could be found, however. “If we can add additional monies in terms of transportation and onshoring I think there’s a deal to be made,” he said, referring to the White House’s desire for incentives to bring manufacturing back to the US.

Bloomberg

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