We’ve entered the part of the negotiations over stimulus relief to the Covid-19 pandemic and its economic fallout where everyone is putting their ideas on the table. That’s productive, but with just nine days to go until the next spending deadline, there’s not much time left for it.
There are a lot of proposals and none of them are ready to be voted on. The White House is officially back in the game on stimulus talks for the first time since the election. Senate Majority Leader Mitch McConnell is suggesting his own path forward, and the bipartisan group is still trying to solve for the problem of liability insurance that has confounded negotiators for months.
The bottom line: The White House offer is dead on arrival by Democrats. All eyes on the bipartisan group and whether they can close their deal. The sticking point? Money for state and local governments and liability protections.
The bipartisan plan
CNN obtained a copy of the summary of the bipartisan proposal on Wednesday morning. The summary did not include liability and state and local aide, but does provide a snapshot of how they plan to structure other programs, including the small business loan Paycheck Protection Program, education funding, transportation funding, opioid funding, unemployment extenders and the student loan payment freeze.
This list isn’t exhaustive, but a sampling of what the bill includes:
- $300 in enhanced unemployment benefits for 16 weeks
- extension of unemployment benefits for gig workers
- extension of program that allows people to remain on unemployment for 39 weeks instead of 26
For small businesses:
- $300 billion to the Small Business Administration to provide another round of PPP loans for businesses with fewer than 300 employees that experienced demonstrated revenue losses because of the pandemic
- transportation funding for Amtrak, airports, bus companies and an extension of the payroll support program for frontline aviation workers.
On health care:
- $35 billion for health care providers, including $7 billion for rural health and $1 billion for tribal health care facilities
- $6 billion for vaccine distribution
- $7 billion in testing and tracing grants for states and localities and an additional $2 billion for nursing homes
- $82 billion for education providers
- extension of student loan payment freeze through April 30, 2021
- $25 billion to states and localities for rental assistance
- 15% increase in Supplemental Nutrition Assistance Program, or SNAP, benefits for individuals for four months
- $13 billion for farmers, ranchers affected by the pandemic
- $10 billion for childcare providers struggling amid the pandemic
- $6 billion in broadband grants
Missing from this proposal?
- Details on what the plan is exactly for state and local funding and liability. Under the liability section it says “agreement in principle as the basis for good faith negotiations.”
A word of warning that the group involves a lot of players. Therefore, any announcements on when these will be rolled out should be taken with caution as there are just a lot of members who have to agree before anything is seen publicly.
So what was in Mnuchin’s offer Tuesday?
Multiple sources told CNN that while a plan from Treasury Secretary Steven Mnuchin’s did include a lot of the same provisions that were in the bipartisan bill – including $160 billion for state and local funding and a more “robust” liability protection – it also included $600 direct checks for Americans. It paid for those checks, however, by scrapping a provision in the bipartisan bill that brought back $300 enhanced weekly unemployment benefits. Those benefits ran out at the end of July, but were replaced by Trump’s executive order in August and are seen by Democrats and some Republicans as essential in these talks. As one Democratic aide put it, replacing a weekly $300 benefit that goes through March with a one-time $600 payment is not going to cut it.
Still, Mnuchin’s involvement sends an important signal. The White House, which has largely been playing a behind-the-scenes role in these talks, is back in the game. CNN has been told that GOP leadership was fully engaged and onboard with what Mnuchin offered Tuesday night even if the plan did look different than McConnell’s suggestion earlier in the day to scrap liability and state and local aid and move on.
If you were watching Tuesday, it was easy to get whiplash.
As the bipartisan group struggled to find a compromise on state and local aid and liability insurance, McConnell suggested in the GOP lunch call and later publicly, that it made sense to drop them both and move ahead with a package that already had broad agreement.
“We can’t leave without doing a Covid bill. The country needs it,” the Kentucky Republican said, adding, “What I recommend is we set aside liability and set aside state and local and pass those things that we can agree on, knowing full well we’ll be back at this after the first of the year.”
Democrats didn’t like that suggestion with Democratic Whip Sen. Dick Durbin of Illinois calling it “a breach of faith” that he couldn’t support.
Hours later, just as bipartisan senators were beginning another Zoom negotiation over their own relief bill – Mnuchin announced he had presented a new $916 billion proposal to Democrats that included the state and local aid and liability protections that hours earlier McConnell had suggested should be gone.
Democrats swiftly threw cold water on Mnuchin’s plan, saying that the bipartisan group’s work should continue.
Be on the look out to see if leadership has any more calls or meetings today about stimulus or spending. While Democrats have made it clear that they want to let the bipartisan group’s work play out, there isn’t a ton of time left to wait for them to close this deal. McConnell has signaled he’s open to talk with his suggestion Wednesday. Mnuchin is clearly trading proposals with Democrats as well. And while Democratic leadership wants to give the bipartisan group space, talks between leadership aides over a path forward have never stopped. Keep your eye on the principles here.
And of course, the House votes Wednesday afternoon on a one-week continuing resolution to keep the government open.
A reminder about the bipartisan group
While the group does include Republicans and Democrats and it’s grown to include members like Sen. Lindsey Graham, a South Carolina Republican who has been helping on the liability piece, the Republicans in the bipartisan group don’t represent the views of the GOP conference at large on some of these issues. What might work for Sen. Mitt Romney, a Republican from Utah, or Maine Republican Sen. Susan Collins may not work for Wyoming GOP Sen. John Barrasso.
Even if the group irons out a final proposal and has bill text, it’s not the end of the agreement. There was some pushback in GOP lunch Tuesday over the path the bipartisan group is taking, according to aides. And, there is a recognition that leadership will eventually have to get involved in it. McConnell isn’t one to bring bills to the floor that only have a handful of Republican votes. He’s going to have to get broader buy-in from the conference.
The House vote on the $741 billion defense policy bill was a strong 335-78. That’s more than veto proof. The hope among GOP leaders is that the Senate will have its own strong vote that will force the President to reconsider vetoing it in the first place.
It’s still important to remember that if Trump does veto this proposal, lawmakers will have to take their votes all over again. And, while Republicans might have voted “yes” the first time, that “yes” gets harder when a President who is popular with your base calls on you to vote no. House Republican Leader Kevin McCarthy has already said that while he voted the bill the first time, he won’t back it again if Trump vetoes it.
“I don’t believe Republicans, in our work with the President always, that you vote to override a veto,” McCarthy said.
This story has been updated with additional developments Wednesday.