COVID-19 Stimulus Update: Trump Proposes New $1.8 Trillion Plan

By Tiziana Celine Oct 09 2020, 20:49 PM EDT

The White House significantly increased its coronavirus stimulus offer to $1.8 trillion as it seeks to strike a pandemic relief agreement with the Democrats.

It further narrows the distance between both parties to pass new assistance before the election.

"Covid Relief Negotiations are moving along. Go Big!" President Donald Trump said in a tweet Friday.

Treasury Secretary Steven Mnuchin proposed more than $1.8 trillion to House Speaker Nancy Pelosi on Friday. The new bid represented the latest surprising turn in a turbulent week of talks.

The president moved from closing down the words in the space of three days to reviving them with his best deal to date. A source familiar with the budget told WSJ it contained expenditures of $1.88 trillion.

Around $400 billion of funds were reallocated from unspent funding from prior relief legislation and took the overall expense to about $1.5 trillion. Before Voting Day, any agreement will pose challenges to passage.

In the remaining weeks, the Senate is working on confirming Supreme Court candidate Amy Coney Barrett.

And suppose the Trump administration and Pelosi agree to terms. In that case, several Republicans in the Senate remain resistant to another big round of assistance, finding it impossible to approve a new agreement quickly.

New Details

Pelosi and Mr. Mnuchin met on Friday afternoon for about 30 minutes on a GOP proposal that, according to a spokeswoman for Pelosi, "attempted to fix some of the issues Democrats had."

The spokesperson reported that the talks continue to reach a consensus on the COVID-19 Public Health Strategy terminology and the total amount of support.

Democrats approved a $2.2 trillion bill last week. They made a scaled-back variant of their earlier $3.5 trillion bill. A $1.6 trillion stimulus plan has previously been proposed by Mnuchin.

On Friday, White House spokeswoman Alyssa Farah said the administration was "willing to come up on the level" but preferred to hold it below $2 trillion. The latest offer rekindled optimism from senators who were calling for extra aid to pass.

"Now that the negotiators are back at the table, let's get a bipartisan deal across the finish line," Reps. Tom Reed and Josh Gottheimer, co-chairman of the bipartisan Problem Solvers Caucus, said in a joint statement Friday.

For months, significant gaps have overshadowed attempts to pursue a bipartisan consensus. Federal assistance to state and local governments, who have had their finances battered through the pandemic, is chief among them.

According to the individual familiar with the bid, the new offer from the Trump administration contains $300 billion for state and local governments, an improvement from the $250 billion they had suggested last week.

Democrats included $436 billion for state and local governments in the bill approved last week, reducing more than $900 billion they initially requested earlier this year.

More uncertainties seen

Senate Majority Leader Mitch McConnell said earlier Friday that it remained uncertain if Congress will approve a pre-election coronavirus stimulus plan. Hence, the chances of having a deal in the coming weeks become more uncertain.

Before election day, Republicans are pressing to confirm Barrett to the Supreme Court. Moving a big piece of legislation without unanimous approval would chew up time on the Senate floor.

"Even if an agreement is reached, and it may be, the process around it, literally the writing and all that, does take a while. The first item of priority for the Senate is the Supreme Court," McConnell said at an event in Kentucky.

On Thursday, McConnell stated that a "large number" of Republicans in the Senate were not persuaded of the need for additional government aid and raised reservations over deficit expenditure.

The revenue deficit has more than tripled to $3.1 trillion in the fiscal year 2020 from $984 billion a year ago. But several GOP senators have been proposing another contract, especially those running close races in November.

Sen. Joni Ernst said that she met with Trump and encouraged him to find an understanding on Friday.

"I'm hopeful Congress can come together once again-Rs and Ds-and provide more support to hardworking Americans," she tweeted.

Entire budget needs "further study"

On Friday, Pelosi said on MSNBC that she intended to study the administration's entire budget schedule and the relevant policy recommendations.

In a letter to House Democrats also Friday, Pelosi said the bill needed to provide support for research, touch tracing, exclusion procedures, and production and delivery of vaccinations.

Quite generally, the two sides practically accept that, among other steps, the next bill should provide aid for unemployed employees, small enterprises, colleges, and public-health efforts.

In the spring, Congress passed, and the president signed into legislation nearly $ 3 trillion in relief, a historical initiative that analysts have credited with forestalling any of the pandemic's worst economic effects.

After ending them earlier this week, Democratic presidential candidate Joe Biden claimed Trump had displayed swings in his approach to the talks.

Economists also cautioned that waiting any longer for an economic stimulus program to go ahead could hinder the tenuous rebound, which shows signs of slowing down.