The Washington PostDemocracy Dies in Darkness

Mnuchin says new economic relief deal unlikely before election, although talks with Pelosi continue

Treasury secretary suggests politics is getting in the way of an outcome.

Treasury Secretary Steven Mnuchin told reporters that a new bailout deal is unlikely before the election. (Bloomberg News)

Treasury Secretary Steven Mnuchin said Wednesday that a new economic relief bill is unlikely before the election, suggesting that Democrats are unwilling to give President Trump a victory.

“I’d say at this point getting something done before the election and executing on that would be difficult, just given where we are,” Mnuchin said during an event hosted by the Milken Institute’s Global Conference.

Asked whether Democrats are unwilling to make a deal because they don’t want to give Trump a win three weeks before the election, Mnuchin replied: “I think that definitely is part of the reality. That’s definitely an issue.

“But the president is very focused on when he wins we will need to do more. So that’s part of the reason to continue to work on this," the treasury secretary added. "The clock will not stop.”

Prospects for more stimulus checks, coronavirus relief fade as latest offer from Trump draws opposition from Republicans and Democrats

Mnuchin made his comments after an hour-long conversation he had earlier Wednesday with House Speaker Nancy Pelosi (D-Calif.). The two have been negotiating the contours of a comprehensive deal for a couple of weeks, despite the long-shot prospects for success. Trump on Wednesday called for a deal in a Twitter post, urging negotiators to “go big or go home!!!”

House Speaker Nancy Pelosi (D-Calif.), along with several colleagues, has repeatedly defended the $2.2 trillion relief bill that House Democrats passed Oct. 1. (Video: The Washington Post)

Mnuchin made Pelosi a $1.8 trillion offer on Friday that she rejected as inadequate in many respects, including the administration not agreeing to specifics on a national coronavirus testing strategy.

“It’s like you’re bleeding and they keep putting band-aids on it. But they’re not addressing the problem,” Pelosi told House Democratic leaders in a meeting Wednesday, referring to the administration’s refusal to embrace a national strategic testing plan. Her comments were confirmed by a person familiar with them who spoke on condition of anonymity because the meeting was private.

Pelosi’s spokesman, Drew Hammill, said on Twitter that Pelosi and Mnuchin had a “productive” conversation and would speak again on Thursday.

Trump on Wednesday blamed Democrats for the logjam, telling the New York Economic Club: “I’d like to see the Democrats loosen up a little bit.”

Treasury Secretary Steven Mnuchin and White House chief of staff Mark Meadows have called on Congress to approve a smaller-scale deal. (Video: Reuters)

He said that concern about the rising national debt is “very much on my mind” but that the issue would be taken care of because of faster economic growth, a claim that economists from both parties have questioned. The U.S. federal deficit has broken records because of the government’s efforts in response to the coronavirus and is expected to breach $3 trillion for this year after reaching $1 trillion last year.

Mnuchin and Pelosi have agreed on some areas, including a new round of $1,200 stimulus checks. But have remained far apart on funding for state and local aid, child care and unemployment insurance, and continue to argue about specific language in some areas. Democrats also oppose liability protections the administration wants in any deal.

Mnuchin criticized Pelosi’s focus on a comprehensive deal, saying they could and should act immediately to help specific sectors, such as airlines that have begun mass furloughs after federal aid expired at the end of September. Pelosi and Mnuchin briefly discussed a stand-alone airline aid bill last week, but Pelosi then rejected that idea amid a backlash from some unions and Democrats questioning why only airlines should receive help.

“From our perspective we could have immediate help to many different parts of the economy now,” Mnuchin said.

“I don’t agree with the speaker’s approach of ‘we have to do all or nothing.’ We’re continuing to negotiate a comprehensive bill but we want to put money into the economy now,” Mnuchin said.

Over the weekend, Mnuchin called on Congress to redirect about $130 billion in unused funding from the Paycheck Protection Program intended for small businesses while negotiations continue on a broader relief effort.

Pelosi has rejected such piecemeal efforts. She defended her approach in a contentious interview on CNN on Tuesday night, telling host Wolf Blitzer he didn’t know what he was talking about when he pressed her on why she wouldn’t agree to Mnuchin’s $1.8 trillion offer.

Senate Republicans, however, oppose the Mnuchin offer as too high and convened a conference call with Mnuchin and White House Chief of Staff Mark Meadows over the weekend to make their opposition clear. Senate Majority Leader Mitch McConnell (R-Ky.) intends to try to advance a narrow, approximately $500 billion bill next week on the Senate floor, where it’s likely to encounter Democratic opposition. He tried the same thing last month, also without success.

Trump has made erratic moves and demands that appear to have strengthened Pelosi’s negotiating position in recent weeks. He has said that he wants to spend even more money than Democrats have approved -- just days after calling off talks, only to backtrack on that almost immediately. The House last month passed a $2.2 trillion bill that Senate Republicans have not brought up for a vote.

The White House and Congress passed several measures earlier this year in an effort to address the economic fallout from the coronavirus pandemic, approving close to $3 trillion in new spending. Those laws provided a temporary boost in unemployment benefits, help for small businesses, a round of $1,200 stimulus checks, aid for the airline industry and a range of other programs.

Some of these programs have expired in recent months, though, and there are numerous signs that the economy is beginning to strain. The airline industry and other sectors have recently laid off thousands of additional workers, and many Americans remain behind on their utility bills, mortgage payments, and rent. Federal Reserve Chair Jerome H. Powell has said there could be severe complications in the economic recovery if Congress doesn’t approve more assistance.