White House reportedly backs additional COVID-19 cash to states

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WASHINGTON – Treasury Secretary Steven Mnuchin said on Tuesday that the Trump administration would be willing to provide further assistance to state and local governments – a key sticking point in stalled negotiations on another round of federal coronavirus relief.

Mnuchin also urged lawmakers to move forward with a package that would address specific areas of agreement, such as improved loans to small businesses, money for safe schools to reopen, and direct payments to schools. individuals.

He spoke during a hearing of a COVID-19 monitoring panel in the United States House and agreed to contact House Speaker Nancy Pelosi (D-Calif.) To resume negotiations an once the hearing is over.

However, Mnuchin did not cite a specific figure for state aid and reiterated the administration’s position that Democrats were offering nearly $ 1 trillion in such aid was too high, as well as ‘other requests.

He conceded that negotiators remain distant from each other. Senate Republicans have been strongly resistant to pressure from House Democrats for higher levels of state aid.

In his opening remarks, Mnuchin also supported “substantial” funds for tests and vaccines and the continued improvement of unemployment benefits – another major point of contention between the parties. And he called for a liability protection for universities, schools and businesses, a GOP priority Democrats have so far rejected.

Lawmakers have enacted four coronavirus packages since March and have been debating the outlines of a fifth for months. Mnuchin was deeply involved in these negotiations.

Pelosi said Monday that “Republicans refuse to act” and that they “do not understand the gravity of the situation or do not care about the needs of American working families.”

House Democrats presented their opening offer in a Invoice they passed in May, which would provide some $ 3 trillion in additional relief. It includes nearly $ 1,000 billion in assistance to state, local, territorial and tribal governments so they can keep firefighters, police, health workers, teachers and other public service professionals on the payroll despite budget deficits.

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Senate Republicans came up with a more focused $ 1 trillion blanket proposal earlier this summer. They accepted $ 150 billion helping states and cities and more flexibility to spend the $ 150 billion for cities and states that were approved in a previous COVID-19 package.

The Democrats have offered to lower the price of their entire package by $ 1,000 billion if the Republicans increase theirs by $ 1,000 billion. But Republicans rejected the offer, and Mnuchin said Tuesday that Democratic leaders will not continue to negotiate until all parties agree on a number in mind.

Talks broke off as lawmakers left for their August vacation. Soon after, President Donald Trump signed three presidential memorandums and an executive order targeting people who are unemployed, threatened with deportation, or beset by student loan repayments. Democrats called these actions a “band aid” in the event of an economic crisis and questioned their legality.

On Tuesday, Mnuchin urged lawmakers to push for a broader deal – but acknowledged Republicans and Democrats are still a long way off on key issues.

He called $ 1 trillion in aid to states and cities “way too high” and cited ongoing bickering over how much money to set aside for other priority items. He called for a piecemeal approach if the parties cannot agree on a larger package.

“Let’s start spending the money where we can agree to help the American people,” he said.

In what appeared to be a resumption of negotiations during the hearing, House Majority Whip representative James Clyburn (DS.C.), chairman of the panel that held the hearing, reported of his willingness to find “middle ground” and said Democrats were willing to step down if the administration is willing to come and include aid to states and local governments.

But an agreement still seems far from being reached.

Ohio Rep. Jim Jordan, a Republican, opposed the bailout of Democratic-led state and local governments. His comments echoed those of Senate Majority Leader Mitch McConnell (R-Ky.), Who earlier this year called aid to cities and states a “blue state bailout” and called out aid to cities and states. said he would be willing to allow states to file for bankruptcy.

McConnell’s comments sparked an uproar among Democratic and Republican leaders, who noted that state and local governments led by both sides face budget deficits.

Jordan has also objected to helping states led by Democratic governors who have ordered closures to prevent outbreaks of infection, although GOP-led states have also mandated closures, and said a large some of the money approved in a previous coronavirus package has yet to be spent.

Instead, Jordan called for helping small businesses and giving states more flexibility to use the $ 150 billion already approved for states in the CARES law. Forget the “leftist nonsense,” he said. “We need to focus on one thing and only one: letting people go back to work. “

Clyburn swept off Jordan’s broadsides. “It’s not just Democratic governors not reopening schools and businesses,” he said. “It is each governor taking into account the health situation in his particular states. “

Representative Jamie Raskin, a Democrat from Maryland, said he was happy to hear that the administration is open to help cities and states and praised Mnuchin for taking a different tone on the issue.

He also dismissed claims that cities and states did not spend allocated funds earlier this year as a “talking point” Republicans are using to oppose further aid.

He said a report published last week by the Treasury Department does not fully account for all city ​​and state allocations and obligations or for spending in July and August.

Mnuchin announced the “strengthening of the economic recovery,” citing growth in employment, retail sales, business activity and home sales, while Clyburn pointed out that millions of Americans are facing deportation, debt and hunger as the pandemic rages on. But Mnuchin conceded that “there is still work to be done and some areas of the economy need further relief.”


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