Getting a new stimulus spending package approved by Congress is unlikely before the November election, US Treasury Secretary Steven Mnuchin said Thursday, even as his boss President Donald Trump indicated he may raise his offer amid an impasse with the Democrats.
Lawmakers have tried fruitlessly for months to reach an agreement on a follow-up to the $2.2 trillion CARES Act after key provisions of that rescue measure expired, depriving small businesses of support and sparking mass layoffs by US airlines.
Talks resumed in recent weeks but with the November 3 election drawing ever nearer and Democrats and Republicans still arguing over how much to spend and in what form, Mnuchin acknowledged the talks are facing tough odds.
"A deal would be hard to get done before the election, but we're going to keep trying," he said in an interview on CNBC. "So, I don't want to say that it's not likely, it's just there are significant issues."
The latest White House proposal costs $1.8 trillion, while Democrats controlling the House of Representatives have approved a $2.2 trillion bill. In an interview with Fox Business Network, Trump said he'd consider spending more.
"I would pay more, I would go higher," he said, but added "it's going to be very hard to do anything" with Democratic House Speaker Nancy Pelosi.
Major Wall Street indices sunk into the red over the past days as traders began realizing new economic stimulus may not come any time soon. The Dow was 0.6 percent lower in early trading Thursday.
'Crush the virus'
The CARES Act has been credited with boosting consumption and keeping small businesses afloat through a program of loans and grants, but those measures have expired.
A separate program to stop airlines from laying off workers despite a collapse in travel during the pandemic expired at the start of October, and major carriers have since furloughed around 32,000 employees.
Labor Department data released Thursday showed jobless benefit applications ticking up in the week ended October 10 to their highest level since August, and still well above the worst week seen in the 2008-2010 global financial crisis, with 898,000 new filings.
Trump threw the stimulus negotiations into chaos last week when he ordered Mnuchin to halt the talks, but quickly reversed course.
Republicans have tried to push through smaller individual bills, but Pelosi said Democrats would only support the measures, including one targeting airlines, in the context of a comprehensive package.
Pelosi and Mnuchin are set to speak again on Thursday, but in a Wednesday interview on CNBC, Pelosi insisted on a "clear plan to crush the virus" as well as funds for education and to protect worker safety.
The House Speaker has objected to components of the Trump administration proposal, while Republicans controlling the Senate have revolted on the overall cost of a stimulus measure.
Senate Majority Leader Mitch McConnell has announced he will schedule a vote on a measure to fund the Paycheck Protection Program, which gave loans and grants to small businesses hit by businesses closures to stop Covid-19 -- a measure House Democrats appear certain to reject.