Wednesday, February 21, 2024

The next round of stimulus will likely lose support from states and local governments

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For the latest information on ongoing stimulus negotiations, please see our cover here.

As key Washington negotiators reach a long-overdue deal on COVID-19 relief, grassroots Democrats appear increasingly resigned to having to drop, for now, a reduced demand for tax relief for US citizens. States and local governments whose budgets have been imbalanced bythe pandemic.

House Speaker Nancy Pelosi, D-Calif., Spoke by phone with Treasury Secretary Steven Mnuchin on Monday evening and continues to push for help for struggling states and communities. But the best Democratic allies ofPresident-elect Joe Bidenspoke out in favor of a $ 748 billion plan proposed by a bipartisan group of lawmakers and hinted that they will not insist on a pitched battle for state and local aid now.

“We cannot afford to wait any longer to act. This should not be the last COVID relief bill from Congress, but it is a strong compromise that deserves the support of Republicans and Democrats in the Senate, ”said Senator Chris Coons, D-Del. “We cannot go on vacation without providing relief to Americans who need it.”

The message from Coons, a confidant of Biden, and a similar message from Senate Majority Whip Dick Durbin, D-Ill., Came as a bipartisan group of lawmakers unveiled a detailed COVID-19 aid proposal in the hope that she would serve as a role model for their struggling leaders to follow as they attempt to negotiate a final deal.

But the group has been unable to forge a compromise on the provisions the GOP is seeking to protect businesses from lawsuits related to COVID-19, a key priority of Senate Majority Leader Mitch McConnell. The Kentucky Republican is pushing for a lowest common denominator approach that would ditch the idea of ​​a lawsuit shield for the time being if Democrats agreed to ditch a $ 160 billion state and local aid package.

Pelosi has insisted for months that state and local aid will be part of any final bill, but with time running out Democrats seem unwilling to hold the rest of the package hostage in the face of demand. Several Democrats appeared at the bipartisan press conference endorsing the $ 748 billion package.

“I found it interesting that they separate national and local provisions and liability. Senator McConnell had suggested this earlier, ”said Senator John Cornyn, R-Texas. “It seems to me that we are making progress on this.”

Cornyn, a Lieutenant McConnell, spoke after a dozen lawmakers unveiled two bills. One is a $ 748 billion aid package containing money for struggling businesses, the unemployed, schools and vaccine distribution. There is also $ 45 billion for transportation and transit assistance, rural Internet service funding, and postal service assistance, among others. The other bill offers a $ 160 billion aid package for state and local governments and a modified accountability shield backed by Republicans and West Virginia Democrat moderate Joe Manchin, but it’s probably too much. politically charged with moving forward.

The way forward for their proposals – and for help with COVID-19 more generally – remains unclear, although Cornyn has said the bipartisan plan contains a lot of “good stuff” for any end-of-year deal.

Any deal will likely be forged in parallel negotiations between Pelosi and Mnuchin – closely watched by McConnell.

Outstanding issues in the leadership talks include a potential second round of direct payments to individuals, a $ 300-per-week unemployment bonus plan, state and local assistance, and the accountability shield the GOP is seeking against COVID-19 lawsuits.

Senator Susan Collins, R-Maine, said she hopes Capitol Hill executives and administration will use the proposals as the basis for a COVID-19 relief package “which our struggling families, our small businesses hit hard on. affected are in urgent need, our health care providers stressed, our postal service overwhelmed, our schools in difficulty and so many more.

Lawmakers have also been working to finalize a year-end catch-all funding program that will serve as the basis for the last major legislation of the Trump presidency.

There is a hoped-for deadline of midnight Friday to hand the full package over to President Donald Trump, when a partial government shutdown would come with the expiration of last week’s temporary funding bill. But there is no guarantee that the massive year-end measure will be completed on time. If talks drag, more temporary bills may be needed.

Negotiations on the $ 1.4 trillion catch-all spending bill are “essentially complete,” said a congressional aide attending the talks. Although the details are closely kept, “the status quo prevails”. This means Trump would get around $ 1.4 billion more for a final installment to continue building his long-awaited US-Mexico border wall.

Republicans managed to kill off a $ 12 billion plan to shatter last year’s mini-budget deal by using accounting tricks to boost funding for veterans health care to cope with sharp increases in costs associated with expanding access to health services from private providers. Instead, a different set of metrics is used to forecast equivalent spending increases for other national programs.

The lame post-election session is the last chance to wrap up the unfinished business this year, a goal of all parties involved, although they have so far been slow to forge the often delicate compromises needed to pull the measure together.

Pelosi did not throw in the towel on his push for public and local aid, which was part of the nearly $ 2 trillion CARES bill passed unanimously by the Senate in March. But many Republicans are adamantly against the idea now.

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