Coronavirus relief talks collapse on Capitol Hill as Trump readies executive actions

“At this point we are going to recommend to the president that over the weekend we move forward with some executive actions,” Mnuchin said, though Trump administration officials have provided little guidance on how the executive actions would work or how they would attempt to redirect money without congressional approval.

The talks had a dramatic and bitter unraveling, in part because Trump and Democrats have been locked in brinksmanship for years but often found ways to reach agreement on spending packages. There seemed to be little goodwill during the talks, and both sides dug in even as the economic recovery has shown signs of losing steam and millions of Americans remain unemployed.

Democrats said they had offered to reduce the pricetag of their $3.4 trillion bill by $1 trillion, but that administration officials rejected the offer.

They kept the door open to further negotiations, but after days of fruitless talks, chances for a deal were evaporating. Mnuchin said no further meetings were scheduled.

Democrats say they cannot accept a bill that provides less than $2 trillion in new spending, while Senate Republicans believe no bill that large can pass their chamber. That left no clear legislative path forward, even as some 30 million jobless Americans have gone two weeks without emergency federal unemployment benefits that expired.

“They said they couldn’t go much above their existing $1 trillion. And that was disappointing,” Schumer said.

“We’re hopeful that they will think about it and come back and tell us they’re willing to meet us halfway,” he said.

But instead of additional negotiations the White House appears prepared to begin rolling out executive actions in coming days.

There are at least four executive issues that White House officials have said they’d like to target through executive orders, though the legal standing for such a move without Congress is unclear.

One target is to attempt to provide some relief to jobless Americans whose enhanced unemployment aid expired at the end of last month. White House officials have looked at potentially redirecting money from other programs towards unemployment benefits. Another target is to provide eviction relief for Americans who had been protected by a congressionally authorized eviction moratorium, but it expired last month as well.

The moratorium covered renters who live in homes with federally backed mortgages, which the Urban Institute estimates to be 12.3 million households.

White House officials are also looking to extend student loan flexibility to certain Americans, cognizant that a congressionally approved program for those borrowers expires next month.

White House economic adviser Larry Kudlow also said that Trump is poised to sign executive orders deferring payroll taxes, but the logistics of that is also unclear. It could not be immediately learned, for example, if Americans would ultimately have to repay any deferred tax cut.

A positive jobs report Friday morning appeared to harden the administration’s posture, with Kudlow pointing to the 1.8 million jobs added in July as evidence of a “self-sustaining recovery.”

Trump and White House officials have been eyeing the possibility of unilateral action all week, and Kudlow confirmed Friday that they were looking at “repurposing” hundreds of billions of dollars that have not yet been spent from earlier coronavirus relief legislation passed this spring.

The legality of such a moves is questionable, with Democrats insisting the White House can’t spend money without approval from Congress. But Trump has pushed the boundaries of executive authority in the past, including his move to declare a national emergency at the U.S.-Mexico border so he could raid Pentagon funds to build his wall.

Kudlow said the executive actions under consideration include moves to “reform unemployment” by providing a benefit for re-employment and a retention tax credit for employers.

Cutting the 7.65 percent payroll tax, which comes out of workers’ salaries and goes to fund Medicare and Social Security, has been a long-standing goal for Trump. Lawmakers in both parties question the value of such a move, partly because it would do little to help workers who are not actually employed. In recent days, White House officials have not been clear as to whether Trump believes he has the power to unilaterally defer the tax or actually cut it.

Before the meeting even started, Schumer and Pelosi heaped insults on Republicans in general and Meadows in particular, in comments that did not seem designed to engender fruitful negotiations.

“Basically, what’s happening is Mr. Meadows is from the Tea Party … and they don’t want to spend the necessary money,” Schumer said of the former North Carolina congressman, who was a leader of a faction of anti-spending rabble-rousers when he served in the House.

Pelosi said for the second day in a row that Republicans don’t give “a damn” about people in need.

For their part, Republicans accused Democrats of trying to get a political outcome instead of a deal, with the election approaching.

“Rather than be part of the solution, they have chosen to be part of the problem,” Sen. John Cornyn (R-Tex.) said on Twitter on Friday.

Both sides in the talks appeared to be posturing amid confusion about what happens next. They have already missed several deadlines, and emergency benefits and eviction protections for millions of Americans expired at the end of July.

Mnuchin, Meadows, Schumer and Pelosi have had multiple lengthy meetings over the past two weeks, only to come up empty-handed on a deal.

Democrats have been pushing for a wide-ranging $3.4 trillion bill the House passed in May, which extended the enhanced $600 weekly unemployment benefits through January, among many other provisions. Republicans are reluctant to spend more than $1 trillion after already signing off on about $3 trillion in stimulus for the economy and support for the health-care system this spring — an unprecedented sum.

In a letter to fellow House Democrats on Friday, Pelosi said that progress had been made on some matters but that the two sides remained far apart on others, including aid to states and localities. Democrats want $915 billion to help states and local governments whose budgets have been decimated by plummeting tax revenue, but Republicans have offered only $150 billion.

There’s also disagreement on money for schools, testing, housing, child care, the postal service, the census and voting.

Pelosi insisted in an interview on MSNBC that Democrats would not agree to a narrow deal just to address the expired unemployment benefits, something Republicans have been pushing.

“No, no, no, no. Not open to a short-term deal. That’s an excuse [for Republicans to say] we’ve done what we’re going to do, we wash our hands,” Pelosi said.

Pelosi defended the Democrats’ approach, insisting they were pushing for legislation addressing the real needs in the country.

“We haven’t overplayed our hand,” Pelosi said. “We aren’t overplaying our hand when we are factually presenting what the needs are.”

Jeff Stein contributed to this report.


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