Democrats block slimmed-down GOP coronavirus relief bill as hopes fade for any

For Senate Majority Leader Mitch McConnell (R-Ky.), wrangling a majority of the Senate behind the legislation constituted a measure of success, after months when Senate Republicans have been hopelessly divided. But next steps — if any — toward the kind of bipartisan deal that would be needed to actually pass a bill to provide new benefits to the public were unclear.

Negotiations between congressional Democrats and administration officials that collapsed in August have not restarted.

“It’s sort of a dead-end street,” said Sen. Pat Roberts (R-Kan.). “Very unfortunate, but it is what it is.”

The failed Senate vote comes amid pleas from Federal Reserve officials and others who have said more fiscal assistance is needed to prevent the economy from sliding further this year. Many of the benefits approved by Congress in the $2 trillion Cares Act in March have run out. Roughly 29 million Americans received some type of jobless aid last week, new Labor Department data show, and large parts of the economy remain under severe strain.

“The needs must be met,” House Speaker Nancy Pelosi (D-Calif.) said Thursday. “We need every penny in order to stop this.”

As the coronavirus pandemic began to grip the U.S. economy in February and March, Congress approved the Cares Act, which authorized a burst of funding to households and businesses in an effort to limit the recession’s toll. Some of the law’s main planks expired around the end of July, such as small business assistance, $600 weekly enhanced unemployment aid, and eviction protections.

House Democrats in May passed a $3.4 trillion bill that would extend some of those measures and approve a number of other initiatives, such as nearly $1 trillion for cities and states, but Republicans and the White House rejected that plan. The White House didn’t begin negotiations with Democrats over what to do next until late July, and those talks faltered as both sides dug in.

With both sides at an impasse, President Trump last month signed four executive actions that were meant to provide some relief. These measures attempted to defer payroll taxes, provide eviction and student loan relief, and redirect some funds that could be used as unemployment aid. But the Federal Emergency Management Agency fund Trump tapped to provide the additional unemployment insurance benefits is being rapidly depleted. The additional unemployment assistance is now expected to completely disappear soon following Thursday’s vote.

The failed GOP bill would have authorized new money for small businesses, coronavirus testing and schools, and $300 in enhanced weekly enhanced unemployment benefits. The measure included roughly $650 billion in total spending, but it would repurpose roughly $350 billion in previously approved spending, bringing the tally of new funding to around $300 billion.

The measure did not include a second round of $1,200 stimulus checks for individual Americans, even though that’s something the White House supports. It also excluded any new money for cities and states, a top Democratic priority as municipal governments face the prospect of mass layoffs because of plunging tax revenue. And it contained some conservative priorities that Democrats dismissed as unacceptable “poison pills,” including liability protections for businesses and a tax credit aimed at helping students attend private schools.

Bipartisan negotiations never gained traction, in part because Senate Republicans struggled to unify behind a single plan in July. Many Republicans opposed any new spending at that time, and McConnell instead deferred to the White House to try and broker a deal with Pelosi. Those talks collapsed with no signs of progress, but McConnell kept working on a GOP bill as a way to balance the needs of a half-dozen vulnerable incumbents who were eager to vote on new aid as they campaign for re-election.

The political wrangling has played out amid mixed signals in the economy. The stock market has mostly recovered from the shock it took in late February and March, buttressed in part by enormous aid the Federal Reserve has injected into the economy. The labor market has recovered roughly half of the jobs that were erased in March and April, but millions of Americans remain unemployed and rehiring appears to have slowed.

The threat of eviction, hunger and poverty remains high.

Nationally, more than one in four survey respondents said they expect someone in their household will experience a loss of income in the next four months, according to the government’s Household Pulse Survey, which queried Americans about their financial wellbeing over the final weeks of August. The new figure, released Wednesday, suggests an estimated 64 million Americans are still facing significant hardship, though economists cautioned the numbers may be skewed because the Census Department had a lower rate of response than it has in its previous studies.

Slightly less than one third of respondents…

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