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Divided Washington debates Covid-19 relief plan as deadline looms

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Millions of Americans will lose their incomes on Boxing Day should Congress and the White House not come to a deal./AFP
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Dec 14, 2020 - 08:54 AM

WASHINGTON — Talks on new economic relief for millions of Americans hit hard by the Covid-19 pandemic are set to continue Monday in Washington between the White House and Congress, with less than two weeks to go before a previous plan expires.

Treasury Secretary Steven Mnuchin and speaker of the House of Representatives Nancy Pelosi spoke on the phone for a half-hour on Sunday, according to a tweet by the top Democrat’s spokesman Drew Hammill, and plan to speak again on Monday.

Democrats and Republicans have been locked in negotiations since July on plans for supplementary financial aid to households, businesses and local communities suffering from the country’s worst economic downturn since the Great Depression.

Aid to the unemployed as part of a massive recovery plan of $2.2 trillion adopted in the spring expires on Boxing Day, when millions of Americans will find themselves without income.

Disagreements on a new plan hinge on two key issues.

Democrats want to ensure that a substantial amount of aid is granted to local and state governments, which their opponents fear would represent a politically-targeted bailout of “blue states”.

The White House and Republicans in Congress are insisting on legal protection for businesses, universities and schools against potential lawsuits in the event that an employee or student contracts Covid-19.

Pelosi on Sunday argued that “the need for state and local funding is even more important, especially given the states’ responsibility for distributing and administering the vaccine,” her spokesman tweeted.

“Health care workers and first responders… are at the risk of losing their jobs without state and local support,” the top Democrat reportedly told Mnuchin.

On the issue of legal responsibility, she said, “a compromise on the liability issue should be found that does not jeopardize workers’ safety.”

A group of Democratic and Republican lawmakers have proposed a bailout of $908 billion, which has served as the base for negotiations.

The Trump administration on Tuesday proposed an increased bailout of $916 billion, but it was later rejected by Democrats, who refused to accept its inclusion of a cut to unemployment benefits.

Whatever is agreed on will likely be eclipsed by the massive bailout plan that President-elect Joe Biden has promised to adopt after his inauguration on January 20.

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