COVID-19 relief talks look dead until September 

Talks on a new coronavirus relief package are going nowhere, increasing the likelihood that there won’t be a deal until at least September and the economy will be cut off from additional stimulus for weeks. 

The stalemate could pose a risk to both parties, but there is little pressure for Congress to move for the time being. 

Lawmakers have mostly fled to their home states, the next jobs report won’t be released until early September and the country’s attention is set to shift for nearly two weeks to the scaled back GOP and Democratic conventions. 

ADVERTISEMENT

Delaying isn’t without risks: The jobless rate now stands at 10.2 percent, but many economists say earlier relief packages kept the number from going higher than its peak of 14.7 percent. 

A $600 weekly federal boost to unemployment benefits has expired, though President TrumpDonald John TrumpBubba Wallace to be driver of Michael Jordan, Denny Hamlin NASCAR team Graham: GOP will confirm Trump's Supreme Court nominee before the election Southwest Airlines, unions call for six-month extension of government aid MORE has taken executive action to replace half the sum; experts are warning Trump’s order on evictions does not actually extend the lapsed moratorium; and the application period for a popular small-business program shuttered last weekend. 

Speaker Nancy PelosiNancy PelosiTrump puts Supreme Court fight at center of Ohio rally CDC causes new storm by pulling coronavirus guidance Overnight Health Care: CDC pulls revised guidance on coronavirus | Government watchdog finds supply shortages are harming US response | As virus pummels US, Europe sees its own spike MORE (D-Calif.) on Wednesday sought to heap pressure on Congress to reach a deal and not punt to next month.  

“I hope not, no. People will die,” Pelosi told reporters on Capitol Hill in response to a question about a deal being delayed until September.

GOP senators expressed worry about the lack of an agreement but also put the onus on Democrats to come to the table. 

“I’m concerned we’re not getting a deal right now,” said Sen. John BoozmanJohn Nichols BoozmanCOVID-19 relief talks look dead until September  Senate GOP hedges on attending Trump's convention amid coronavirus uptick The Hill's Coronavirus Report: San Francisco Gay Men's Chorus Artistic Director Tim Seelig says choirs are dangerous; Pence says, 'We have saved lives' MORE (R-Ark.), adding that he thought the GOP negotiators wanted an agreement but “you’ve got to have a willing partner.” 

ADVERTISEMENT

Sen. Roy BluntRoy Dean BluntThis week: Supreme Court fight over Ginsburg's seat upends Congress's agenda McConnell locks down key GOP votes in Supreme Court fight Murkowski: Supreme Court nominee should not be taken up before election MORE (R-Mo.), a member of GOP leadership, said he hoped the talks didn’t drag into September, before adding, “We’ll see.” 

The lack of urgency comes as Congress falls into a normal summer routine — even as the coronavirus pandemic rattles the country.

While technically not on August recess yet, the Senate is running on a skeleton crew. 

Only a handful of senators have been spotted around the chamber during daily sessions that last less than two hours. The Senate could leave after Thursday, though Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellGraham: GOP will confirm Trump's Supreme Court nominee before the election Trump puts Supreme Court fight at center of Ohio rally The Memo: Dems face balancing act on SCOTUS fight MORE (R-Ky.) has been tight-lipped about his plans. Meanwhile, the House is extending its August break, moving their return date from Sept. 7 to Sept. 14. 

McConnell, during an interview this week with Fox News, argued that it was time to restart the negotiations, saying “it doesn't make any difference who says let's get together again, but we ought to get together again.” 

But there’s no been no signal that negotiations will resume or that congressional Democrats and the administration are on the precipice of breaching the impasse.

Treasury Secretary Steven MnuchinSteven Terner MnuchinShutdown clash looms after Democrats unveil spending bill Lawmakers fear voter backlash over failure to reach COVID-19 relief deal United Airlines, unions call for six-month extension of government aid MORE called Pelosi on Wednesday, according to a source familiar with the conversation. 

But the talk resulted in a joint statement from Pelosi and Senate Minority Leader Charles SchumerChuck SchumerJacobin editor: Primarying Schumer would force him to fight Trump's SCOTUS nominee CNN's Toobin: Democrats are 'wimps' who won't 'have the guts' to add Supreme Court seats Republican senator says plans to confirm justice before election 'completely consistent with the precedent' MORE (D-N.Y.) that accused the White House of “not budging,” underscoring just how entrenched the stalemate has become. 

“We have again made clear to the Administration that we are willing to resume negotiations once they start to take this process seriously. The lives and livelihoods of the American people as well as the life of our democracy are at stake," the two Democratic leaders said. 

The divisions between the two sides are steep: Democrats offered to drop $1 trillion off of their roughly $3.4-3.7 trillion price tag if the administration agreed to add the same amount to its roughly $1 trillion package, which Senate Republicans unveiled last month. 

But the White House rejected that strategy, which would have resulted in a top line in the $2 trillion range. Mnuchin, during an interview with Fox Business, appeared to dig in on keeping the final price tag closer to the $1 trillion preferred by Republicans. 

He also accused Democrats of refusing to negotiate unless the White House agreed in advance to a price tag of at least $2 trillion. 

ADVERTISEMENT

“Democrats have no interest in negotiating,” he said in a statement. 

Beyond a top-line figure, the two sides haven’t resolved how much weekly unemployment benefits would be, how much money to give state and local governments or how to address McConnell’s red line of liability protections. School funding, both the amount and how it's divided up, remains a sticking point. 

Mnuchin and White House chief of staff Mark MeadowsMark Randall MeadowsSouthwest Airlines, unions call for six-month extension of government aid Airline CEOs plead with Washington as layoffs loom Trump reacts to Ginsburg's death: 'An amazing woman who led an amazing life' MORE, the other lead negotiator for the administration, have held daily calls with Senate Republicans this week but given them little indication they see a quick breakthrough in the works. 

“I think I can say the call wasn’t very long. ... Basically, not much new movement,” Blunt said. 

Sen. Chuck GrassleyCharles (Chuck) Ernest GrassleyGardner signals support for taking up Supreme Court nominee this year Grassley, Ernst pledge to 'evaluate' Trump's Supreme Court nominee McConnell digs in on vow to fill Ginsburg's Supreme Court seat MORE (R-Iowa), asked about updates from the two, said they were “pessimistic about getting back to negotiations.” 

Mnuchin also declined to say if he thought there would be a deal, telling Fox Business that he didn’t want to “speculate.” 

ADVERTISEMENT

“If the Democrats are willing to be reasonable, there’s a compromise. If the Democrats are focused on politics and don’t want to do anything that’s going to succeed for the president, there won’t be a deal,” he said. 

Both sides appear to be hoping that political calculations will help bring them back together, arguing that the looming November elections should pressure vulnerable incumbents into wanting a deal to help bolster their reelection prospects. 

“I think the House Democrats are starting to get a little pressure from their members that are in moderate districts as they’ve gone home. You know the Senate is hearing the same thing,” Boozman said. 

But the political dynamic has largely remained static since Friday, and economists warn it could take weeks for pressure to build on Congress to act unless there is a steep contraction in the market. 

“The thing that would really settle it would be the jobs numbers for the month of August, which gets released the first Friday in the month of September,” said Mark Zandi, chief economist at Moody’s Analytics. 

Zandi added that there was still a “strong consensus” among investors that a package would come together in August or September — a sense of calm that could help keep pressure off Congress to move faster. 

Economic advisor Larry KudlowLarry KudlowMORE signaled there is a little incentive, based on the economic data, for the administration to cut a quick deal with Pelosi.

“The numbers are coming in very, very nicely," he told Fox Business. "Unemployment claims coming back down. Jobs going back up. There's a housing boom. There's a manufacturing boom.”