Extra $600 in jobless aid set to lapse as talks deadlock

WASHINGTON — A deadlocked Senate on Thursday left Washington for the weekend without extending a $600-per-week expanded jobless benefit that has helped keep both families and the economy afloat as the COVID-19 pandemic wreaks havoc on the country.

Friday’s expiration of the $600 jobless benefit sent Republicans controlling the Senate scrambling to respond. Top Senate Republican Mitch McConnell made a procedural move to make it easier to reach a potential compromise next week that would extend the bonus unemployment benefit while talks on a broader COVID-19 relief measure grind on. But ahead of late-night talks at the Capitol, the outlook dimmed.

“I’m not very optimistic that we will have any kind of an agreement on a comprehensive bill in the near future,” said White House chief of staff Mark Meadows. He said he even doubted a deal could be struck next week.

But Democrats have so far rejected a piecemeal approach, saying the next relief bill needs to move as a complete package. Any short-term jobless benefits extension of less than $600 per week is likely to be a nonstarter with them.

Talks on the relief bill are at a standstill with few reasons for optimism despite sweeping agreement among Washington’s top power players that Congress must pass further relief in coming days and weeks.

President Donald Trump is eager for another bill, and it’s also a priority for GOP allies like McConnell, as well as House Speaker Nancy Pelosi and top Senate Democrat Chuck Schumer. Democrats hold a strong negotiating hand, with Republicans badly divided over their own proposal.

Raising the stakes, a bleak government report released Thursday said the economy shrank at a 33% annualized rate in the second quarter of the year, a stark reminder of the economic damage afflicting the country as lawmakers debate the size and scope of new relief.

“This jarring news should compel Congress to move swiftly to provide targeted and temporary assistance to unemployed Americans, employers, and state and local governments, and liability protections for businesses who follow public health guidelines,” said Neal Bradley of the U.S. Chamber of Commerce, the powerful business group.

But bipartisan talks have yet to reach a serious, productive phase. Democrats are playing hardball, insisting on a package that’s far larger than the $1 trillion-plus measure unveiled by McConnell on Monday. Thursday brought more tit-for-tat.

“They won’t engage. Period,” McConnell said as he opened the Senate. “The Democrats are saying, my way or the highway.”

In an interview late Wednesday, he showed a willingness to consider some Democratic priorities, like additional food aid. He also said extending the additional jobless benefits was urgent and made clear that he’s standing behind Trump.

“The economy does need more help. We have divided government. We have to talk to each other,” McConnell said on the PBS NewsHour. “And we have to try to get an outcome.”

Schumer continued his daily fusillade against McConnell and Republicans controlling the Senate, noting that McConnell “refuses to go in the room” and join the talks in person, instead transferring ownership of the talks to Meadows, along with Treasury Secretary Steven Mnuchin, who has been a key architect of previous accords.

“We’re trying to negotiate,” Schumer said. “Who’s holding things up?”

In an earlier piece of legislative theater, Sen. Ron Johnson, R-Wis., sought unanimous stand-alone Senate approval of a conservative GOP plan to sharply cut back the $600 per week unemployment benefit to $200, saying that the current amount discourages people from returning to work. Democrats countered with a plan to extend the $600 benefit through January. Both ideas predictably failed, as did an effort by Sen. Martha McSally, R-Ariz., to extend the $600 benefit for just one week.

Pelosi was dashing back to Washington after having traveled to Atlanta for the funeral of Rep. John Lewis, the civil rights icon. Pelosi’s office announced a meeting for Thursday night with the White House negotiators.

Other stark differences remain between the $3 trillion proposal from Democrats and $1 trillion counter from Republicans. Money for states and cities is a crucial dividing line as local governments plead for help to shore up budgets and prevent deeper layoffs as they incur COVID-19 costs and lost tax revenue in shutdown economies.

Democrats proposed nearly $1 trillion for the local governments, but Trump and Republicans are resisting sending the states and cities more cash. Instead, the GOP offers states flexibility to use $150 billion previously allotted for the virus on other needs.

It’s clear that Democrats are trying to push an advantage in the negotiations because Republicans are so split over the prospect of additional government spending. Among the issues sure to gather momentum is a Democratic demand for a 15% increase in food stamp benefits.

Trump has dismissed the GOP bill as “semi-irrelevant” since it leaves out so many Democratic items.

Trump appears worried about the expiration of the $600 unemployment benefit boost as well as an expiring federal eviction moratorium on millions of rental units, potentially sending households into devastating turmoil.

Trump has bristled at one provision of the GOP bill — he said his Republican allies should “go back to school and learn” after they balked at $1.7 billion for FBI headquarters. Trump wants the FBI’s central building to remain in Washington, across the street from his Trump International Hotel. If the FBI moved its headquarters, the site would become prime real estate for a competing hotel.

McConnell has rejected the FBI funding request — added to a $300 billion-plus appropriations package in private talks between Meadows and Senate Appropriations Committee Chair Richard Shelby, R-Ala. — since it is unrelated to virus relief.

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Associated Press writers Mary Clare Jalonick and Lisa Mascaro in Washington contributed to this report.