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Pelosi, Mnuchin meet on economic relief deal as both sides express optimism

House Speaker Nancy Pelosi, D-Calif., speaks during a television interview at the Russell Senate Office Building on Capitol Hill in Washington on Monday, Sept. 28, 2020.

SARAH SILBIGER/BLOOMBERG

By ERICA WERNER, JEFF STEIN AND RACHAEL BADE | The Washington Post | Published: September 30, 2020

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WASHINGTON — House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin met Wednesday in an 11th-hour search for a bipartisan COVID relief deal, even as the House prepared to vote on a $2.2 trillion bill opposed by the GOP.

The early-afternoon meeting in Pelosi’s office at the Capitol was the first in-person discussion between the House speaker and the Treasury secretary since bipartisan talks collapsed in early August.

It comes with the House days away from adjourning through the election, and with the two sides still at odds on key issues including aid to cities and states, liability protections for businesses, and the overall cost of the bill. It’s also unclear whether the GOP-led Senate would get on board even if Pelosi and Mnuchin do manage to come to terms.

But with millions still out of work and signs the economic recovery is slowing, Pelosi and Mnuchin both said they wanted to make one last try to find common ground before the election. The stock market rose on prospects of an agreement.

Mnuchin entered Pelosi’s office shortly after 1 p.m. Asked how close they were to a deal, Mnuchin replied, “I don’t know, we’ll see. Going to see the speaker, see if we can make some good progress today.”

Earlier, in an interview on CNBC, Mnuchin said the counteroffer he was preparing to deliver to Pelosi would be similar to an approximately $1.5 trillion proposal developed by the bipartisan Problem Solvers Caucus in the House earlier this month. That proposal included provisions allowing the price tag to increase to about $2 trillion based on the progression of the coronavirus, which would bring the two sides close in terms of overall spending levels.

“I think there is a reasonable compromise here … It’s something the president very much wants to get done,” Mnuchin said.

Pelosi described herself as “hopeful” in an interview on MSNBC, even while saying that Democrats and Republicans don’t have “shared values” about the needs of Americans.

“I always want to keep the door open for us to have a solution. It’s a negotiation, we won’t get everything we want, but they’re very disdainful, they’re disdainful of working families in our country,” Pelosi said.

Even in absence of a deal, House Democratic leaders were preparing to move forward as soon as Wednesday with a vote on their $2.2 trillion bill, which is a slimmed-down version of the $3.4 trillion Heroes Act the House passed in May.

It includes new stimulus checks, unemployment insurance, state and local aid, and money for schools, the U.S. Postal Service, election security and more. There is also payroll assistance for airlines that are facing the prospect of widespread furloughs as soon as Thursday unless a new aid package is passed.

Republicans oppose the bill as too costly and say it contains provisions extraneous to the novel coronavirus.

“This will be nothing more than fiddling while Rome burns,” Rep. Tom Cole, R-Okla., said Wednesday morning as the House Rules Committee met to agree on rules to debate the legislation.

Democrats disagreed.

“We have to move forward because some may be content with doing nothing but we aren’t,” said Rules Committee Chairman Jim McGovern, D-Mass.

Pelosi has been under intense pressure from moderates in her caucus, including some in tough reelection fights, to take new action to address the continued economic and public-health ravages of the coronavirus.

Majority Leader Steny Hoyer, D-Md., has been among those pushing for the House to vote on a new bill, as it’s been months since House Democrats pushed through the Heroes Act, which the White House and Senate Republicans ignored. Hoyer said that he hoped Pelosi and Mnuchin could reach agreement, but said it was his intention to have the House vote Wednesday on the new, $2.2 trillion bill, allowing members to return home to campaign for reelection able to show that at least they tried.

“We’re going to do the best we can and we’re going to make sure the position of our party is known to the American people in terms of trying to help them at this time of great crisis,” Hoyer told reporters on a conference call.

Pelosi has shown little sign she’s willing to back down from her $2.2 trillion price tag, with Democrats contending they’ve already compromised. On a private call with House Democrats on Wednesday morning, Pelosi said the American people are worth the $2.2 trillion, according to two people on the call who spoke on the condition of anonymity to describe it.

She also said that state and local aid and legal liability protections continue to be obstacles to a deal. Republicans and the Trump administration favor liability protections Democrats oppose, while opposing the generous state and local aid Democrats want. The Democrats’ new bill has about $500 billion for state and local governments, about half as much as the original Heroes Act.

Congress passed four bills totaling an unprecedented $3 trillion in aid in the spring, but since then, the bipartisan urgency that existed at the beginning of the pandemic has dissipated and the Senate hasn’t passed a related bill since. Talks involving Mnuchin and Pelosi collapsed in August and were renewed only a few days ago.

Millions remain unemployed and deaths from the coronavirus continue to mount, but the Trump administration continues to sound bullish about the economy.

“The economy is doing much better than anyone expected. … You’ve seen a very good rebound, and you’re going to see a very good quarter,” Mnuchin said Wednesday, while contending that “more fiscal response will help the economy.”

Stephen Moore, an outside economic adviser to the White House, said he told Trump at a meeting at the White House about 10 days ago that a stimulus deal would do little to boost the president’s electoral prospects. Moore said he told the president the benefits of any stimulus deal reached now would not boost the economy until 2021 or December at the earliest.

“I told him, ‘Mr. President, there’s no deal you can get that will help the economy before the election,’ ” Moore said.

Still, depending on the timing of the deal, it is conceivable that Trump’s administration could still send out millions of stimulus checks before the election. The Internal Revenue Service sent close to as many as 80 million households within two weeks after the passage of the Cares Act in March.

Trump privately indicated last week he believes that he is unlikely to get a deal before the election, according to one person who spoke to White House officials and was granted anonymity to share details of private conversations. The president expressed that he viewed congressional Democrats as unserious about a deal and regards the negotiations as likely a waste of time.

Separately, government funding runs out at midnight Wednesday, and agencies will begin to shut down unless the Senate passes — and Trump signs — a stopgap spending bill already passed by the House. The bill is expected to pass the Senate and to be signed into law in time to avert a shutdown, although Congress and the administration were leaving little margin for error. The legislation must become law by midnight on Wednesday.