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MNI POLICY: US Fiscal Talks Falter; Unemp Support Could Lapse

Talks Set To Resume Thursday, Mnuchin Says

WASHINGTON (MNI) -

Negotiations between Democrats and Republicans over a fifth coronavirus aid package faltered on Capitol Hill Wednesday, with negotiators predicting that support to millions of unemployed Americans hit by the pandemic could lapse at the end of the week.

"We're nowhere close to a deal," White House Chief of Staff Mark Meadows said after leaving talks with top Democrats in the office of Speaker Nancy Pelosi Wednesday. "It means enhanced unemployment insurance provisions will expire."

Democrats want to extend the full benefit through January, while Republicans in the Senate have called for scaling it back to USD200 per week from USD600 for the next few months before finishing out the remainder of the year at 70% of the unemployed persons' previous income.

As the Friday deadline nears some top Republicans are pushing to move a stand-alone short-term extension of the unemployment benefits to avoid the lapse.

SKINNY BILL

"We don't know why Republicans come around here with a skinny bill that does nothing to address really what's happening with the virus," Speaker Nancy Pelosi told reporters. "We're not accepting that."

"We have to have a comprehensive, full bill," she added.

Senate Democratic leader Chuck Schumer blamed divisions among Republicans for the inability of the negotiators to make progress and said that even if a short-term piecemeal proposal on unemployment benefits were to come forward it could not be passed by the Republican-controlled Senate.

"They're tied in knots," Schumer said just after he met with Mnuchin and Meadows. "We want to come back and keep talking to them but they don't have anything to say."

Treasury Secretary Steven Mnuchin nonetheless said negotiations would resume on Thursday.

Mnuchin and Meadows engaged in shuttle negotiations Wednesday between Senate Republicans and Democrats attempting to reconcile differences between the USD1 trillion stimulus plan Republicans released Monday and the USD3.5 trillion package House Democrats passed in May.

SUBSET OF ISSUES

"We're still very far apart on a lot of issues," Mnuchin said Wednesday night. "But I do think there are a subset of issues that we do agree on but overall we are far from an agreement."

There are certain areas of commonality such as including more personal protective equipment for healthcare workers, extending the Paycheck Protection Program for small businesses and lending for community development financial institutions, Mnuchin said.

But there are other areas where there are "significant" differences such as liability protection, funding for education, and funding to states and localities, Meadows noted.

"Overall, we're far from an agreement," Mnuchin said, adding that President Donald Trump is focused on extending unemployment benefits, without providing details.

Asked by reporters what could unlock the impasse, Meadows said: "I don't know that anything does."

MNI Washington Bureau | +1 202-371-2121 | evan.ryser@marketnews.com