The two have negotiated extensively this year on economic relief bills, initially with success but most recently at odds. They are running out of time to reach an agreement before the November elections, but their planned talks this week appear to be the most extensive engagement they have had in more than a month.
Democrats described the new legislation as an updated version of the $3.4 trillion Heroes Act the House passed in May, which the White House and Senate Republicans dismissed as far too costly. Senate Republicans and Mnuchin have also said $2.2 trillion is too much to spend, but Mnuchin has said he is open to negotiations. It was not immediately clear whether if the talks would bear fruit or whether Democratic leaders would use the bill to provide political cover for moderate House Democrats, who have grown increasingly anxious over Congress’s recent inaction on pandemic relief legislation.
As the pandemic worsened earlier this year and many businesses shut down, Congress passed four bipartisan bills in March and April that pumped close to $3 trillion into the economy. But they have not passed an economic-relief law since then. Talks involving Mnuchin and House Speaker Nancy Pelosi (D-Calif.) collapsed in early August and never revived.
Mnuchin has said his priorities in a new round of spending would be aid for small businesses and children, among others. He has also talked about providing more assistance to the airline industry and approving another round of stimulus checks. There is some overlap in the White House’s goals with the things Democrats included in their new bill
For example, the Democrats’ bill would extend the $32 billion payroll support program for the airline industry, which was scheduled to expire on Sept. 30. It would include another round of $1,200 stimulus payments as well as renew the expired unemployment benefits of $600 per week.
The bill would fund a range of other programs, including many that Republicans have supported. It would, for example, extend the Paycheck Protection Program for small businesses and provide $182 billion for K-12 schools and $39 billion for postsecondary schools. An additional $57 billion would go towards other child care costs.
The biggest budget item in the package would be $436 billion in aid to states, cities, territorial and tribal governments that have experienced a major budget crunch this year. That’s about half as much as the amount for cities and states that was included in the original Heroes Act, because the time period for funding state and local budgets was reduced. The White House has mostly opposed more funding for states and cities, and Trump has said that was one of the biggest sticking points in past discussions.
There would be an assortment of other programs supported by the bill, including $75 billion for coronavirus testing and tracing.
“Democrats are making good on our promise to compromise with this updated bill, which is necessary to address the immediate health and economic crisis facing Americas working families right now,” Pelosi wrote in a letter to House Democrats. “We have been able to make critical additions and reduce the cost of the bill by shortening the time covered for now.”
Pelosi had been under growing pressure from moderates in her caucus to take new action on economic relief, with millions still out of work and growing signs that the economic recovery could be stalling after the unprecedented stimulus Congress agreed to at the start of the pandemic.