Senate Majority Leader Mitch McConnell said Friday that the U.S. economy will probably need a reduced stimulus package “at the beginning of the year” – a strong signal that no more coronavirus relief will reach the pockets of struggling Americans during the lame session of Congress in November and December.
“We’ll probably have to come up with a different package, certainly more modest than the $3 trillion Nancy-Pelosi package,” McConnell told conservative radio host Hugh Hewitt. “I think this is something we need to do right at the beginning of the year.
The Kentucky Republican’s statements implied that he did not expect the ongoing talks between House Speaker Pelosi and Treasury Secretary Steven Mnuchin to lead to a bipartisan agreement that could pass the current Congress and land on President Donald Trump’s desk.
McConnell maintained his position that a more targeted action was needed than the $1.9 trillion package offered by Mnukhin and the $2.2 trillion measure demanded by Pelosi.
“We could target it particularly at small businesses that are in difficulty and hospitals that are now struggling with the second wave of coronavirus, and of course the challenges to education, both for K-12 and for college,” McConnell added.
His remarks were just the latest indication that the likelihood of another stimulus agreement being reached and passed before a new Congress – and possibly a new president – is sworn in in January is dwindling.
Pelosi and Mnukhin exchanged barbs on Thursday, accusing each other of delaying the negotiations, which indicated that the talks were not progressing quickly.
The idea that the Democrats would accept a smaller discharge bill during the paralyzed session and then pass additional laws next year if – and if – Joe Biden takes office is out of the question, Pelosi told reporters. She remains unimpressed by her position for a comprehensive law.
“We are not talking about size. We are talking about quality,” Pelosi said. “And we are not going to pass a small bill that had the flaw of imposing money on the richest people in America while questioning the integrity of people in unemployment insurance”.
Nevertheless, Pelosi said she preferred to reach an agreement and pass the bill before the end of the year, regardless of who won the election. The reason for this was twofold.
“The American people need help. They need real help,” she said. “Second, we have a lot of work to do in a Joe Biden administration…. We want to have a clean slate by January.”
“Why should we talk to them if we don’t want a bill?” Pelosi added.
She said Mnukhin has not yet responded to several Democratic proposals involving money for schools, coronavirus testing and tracking, federal unemployment benefits, state and local government subsidies and tax credits. But Mnukhin denied these claims, and the frustration of the meekly-mannered finance minister was evident.
“Your “all or nothing” approach is hurting hard-working Americans who need help NOW,” he said in a letter to Pelosi.
The impasse has continued for months, but so has the economic burden of the pandemic as virus cases rise to all-time highs in many states.
Gross domestic product in the third quarter was promising, growing at an annualized and seasonally adjusted rate of around 33 percent. From the second to the third quarter, GDP increased by 7.4 percent. But the economy is still in recession. Economists, including some officials in the Trump administration, have warned that the downturn will last longer without further federal support.
Trump has touted GDP figures, but without acknowledging that the economy remains below pre-pandemic levels with nearly 11 million fewer jobs.
“33.1% GDP – BEST IN USA HISTORY,” Trump wrote in a tweet on Friday morning “IF I GET ELECTED, NEXT YEAR WILL BE OUR BEST EVER!
On Thursday, he attacked the media for not presenting GDP growth in a more positive light. Along with the GDP news came a slight drop in new unemployment claims last week. However, the number of new applications for unemployment benefits remained high at 750,000.
“The bogus news refuses to report that the GDP increased by 33.1% in the 3rd quarter, by far the best figure in the history of our country! Trump tweeted on Thursday….