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Covid Relief Talks Hit Another Snag

Michael Rainey, Yuval Rosenberg
·4 min read

Congress is cutting it close as lawmakers scramble to avoid a government shutdown just after midnight.

The House on Friday evening passed a two-day stopgap measure that would prevent government funding from lapsing and give negotiators another 48 hours to work out disagreements on a coronavirus relief package.

The Senate is expected to try to approve the stopgap spending bill by unanimous consent later Friday, but it’s not completely clear that it will be able to pass. Any senator would be able to block it, and some have already expressed frustration about the process, but Sen. Mazie Hirono (D-HI) told CNN Friday evening that she had been told no senator would object to the bill.

[UPDATE: The Senate passed the short-term spending bill by voice vote on Friday evening.]

‘Significant issues outstanding’: Lawmakers appeared to be closing in on an agreement this week that would provide $1.4 trillion to fund the government for the rest of the fiscal year, as well as an additional roughly $900 billion in relief for the unemployed, small businesses, schools, Covid testing and tracing, and more. But talks have gotten bogged down repeatedly, with lawmakers unable to agree on several key provisions.

House Majority Leader Steny Hoyer (D-MD) said Friday evening that the negotiators were still trying to reach agreement on both the Covid relief deal and the full-year spending package. “We are hopeful that they will reach agreement in the near future. They have not reached one yet. There are still some significant issues outstanding,” he said on the House floor.

Reining in the Fed: A red flag for the negotiations went up Thursday, when Sen. Pat Toomey (R-PA) demanded that the relief package include language permanently shutting down several emergency lending programs at the Federal Reserve that were created by Congress in the early days of the pandemic.

“What this does is it says that nobody can revive or create a duplicate of the programs that received Cares Act money,” Toomey said. “It is not the role of our central bank, the Fed, to engage in fiscal policy, social policy or allocating credit.” (For more details on the Fed programs, see this Bloomberg piece.)

Democrats complained that Toomey was threatening to torpedo the burgeoning agreement by bringing up new issues, largely for political reasons. “Senate Republicans are once again holding up COVID negotiations,” Sen. Sherrod Brown (D-OH) tweeted Friday. “Now they want to handicap the Federal Reserve's ability to support our economy and struggling communities. This has to stop. Americans are suffering, and they're trying to nickel-and-dime your COVID relief.”

President-elect Joe Biden’s incoming National Economic Council Director, Brian Deese, released a statement criticizing Toomey’s effort and defending the Fed programs. “As we navigate through an unprecedented economic crisis, it is in the interests of the American people to maintain the Fed’s ability to respond quickly and forcefully,” Deese said. “Undermining that authority could mean less lending to Main Street businesses, higher unemployment, and greater economic pain across the nation. Congress’s good faith effort to deliver immediate relief should not be delayed by provisions that could put our future financial stability at risk.”

Seeking bigger checks: On Friday, a group of senators including Josh Hawley (R-MO) insisted on seeing the details of the relief package before agreeing to support it. Hawley said he wants to be sure the measure includes direct payments for Americans, preferably worth up to $1,200 per adult – a level that is twice what is reportedly under consideration — before he agrees to the two-day stopgap spending bill.

“We’ve been in the dark for days on end, we have absolutely no idea what’s actually in this package … so I’m not willing to allow a [spending bill] to go through until I know what’s actually in the package. Direct assistance has got to be in there,” Hawley said.

Sen. Ron Johnson (R-WI) shut down Hawley’s effort to pass a bill calling for $1,200 checks, saying it would be too costly and claiming that the checks would amount to “mortgaging our children's future.” Republicans have reportedly been seeking to keep the cost of the Covid relief bill under $1 trillion, and checks larger than $600 would almost certainly push the measure over that level.

Trump, too, wants to see bigger checks: President Trump was on the verge of throwing a curveball into the negotiations Thursday by demanding direct payments of as much as $2,000 as part of the package, according to a report by Jeff Stein of The Washington Post. Aides intervened, however, warning the president that his demand could upend the negotiations.

Spending bill may still be a ‘heavy lift’ in Senate: The short-term extension may face some opposition in the Senate, where any member can block it. Majority Whip Sen. John Thune (R-SD) said that a short government shutdown might be unavoidable, given that a unanimous voice vote in favor of an extension would be a “heavy lift.” Earlier in the week, Thune said that if a shutdown is “for a short amount of time, on a weekend, hopefully it’s something that’s not going to be all that harmful.”

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