Coronavirus: Last-ditch talks on new aid package for US economy fail

Coronavirus: Last-ditch talks on new aid package for US economy fail

Last-ditch negotiations at the US Congress to forge another stimulus package for the coronavirus-ravaged economy have collapsed in stalemate.

Democrats and Republicans remain at odds over everything from unemployment benefits to financial aid for schools to cash injections for states’ coffers.

The US unemployment rate stands at 10.2%, higher than any level during the 2008 financial crisis.

Jobless benefits have expired, as has a federal moratorium on evictions.

The failure to reach a deal will disappoint tens of millions of unemployed Americans who had been receiving an extra $600 (£450) a week on top of normal unemployment benefits during the pandemic. That payment expired last month and Republicans want to reduce it.

On Friday, House of Representatives Speaker Nancy Pelosi, the most powerful elected Democrat, held a meeting in her Capitol Hill office with Treasury Secretary Steven Mnuchin and White House chief of staff Mark Meadows.

Mrs Pelosi said in a news conference that she was willing to offer a billion-dollar compromise on a $3.5tn (£2.7tn) stimulus bill passed by her Democratic-controlled chamber but rejected by the Republican-held Senate.

“We’ll go down one trillion, you go up one trillion,” she told reporters as she staked out her position, adding: “We have a moral responsibility to find common ground.”

As he entered Mrs Pelosi’s office on Friday, Mr Mnuchin called her proposal “a non-starter”.

Republicans prefer a package closer to $1tn total and want any deal to include legal protections for employers against virus-related health claims from workers.

They also want far less aid to local governments than Democrats are seeking.

In a surprise news conference on Friday evening from his golf club in Bedminster, New Jersey, where he is spending the weekend, President Trump blamed Democratic congressional leaders for the impasse.

“Nancy Pelosi and Chuck Schumer continue to insist on radical left-wing policies that have nothing to do with the China virus,” he said.

He added: “If Democrats continue to hold this critical relief hostage, I will act under my authority as president to get Americans the relief they need.”

Mr Trump said he may seek to defer the payroll tax, unemployment benefits and student loan interest until the end of the year, as well as extending the eviction moratorium.

The White House has previously suggested the president would take unilateral action through executive order. But it is unclear how much he can change by fiat, given that Congress controls federal spending.

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