US government and Democrats remain “very far” on stimulus plan, according to Mnuchin

US government and Democrats remain

Secretary of the Treasury Steven Mnuchin addresses a meeting on Capitol Hill in Washington on August 4, 2020

Secretary of the Treasury Steven Mnuchin addresses a meeting on Capitol Hill in Washington on August 4, 2020

US Treasury Secretary Steven Mnuchin said Wednesday that despite some progress, an agreement has yet to be reached with Democrats on a new stimulus package for the pandemic-affected economy.

“We continue to make progress on certain issues, (but) on some issues we are still very far away,” Mnuchin said at a virtual economics conference.

Democrats and Republicans have been mired for months in discussions about new measures to restore the expired $ 2.2 trillion package of CARES law passed in March when the pandemic hit the United States.

Mnuchin, who is leading the negotiations on behalf of President Donald Trump, said he had a lengthy conversation Wednesday with his Democratic counterpart, House Speaker Nancy Pelosi.

However, the parties do not agree on how much to spend or how to do it. Democrats demand to help states and local governments more exposed to the economic damages of the pandemic.

“We are continuing the talks and trying to agree on a broader package” of assistance, Mnuchin explained, adding that Pelosi rejected a separate measure to help airlines that have put tens of thousands of workers out of work this month.

“All or nothing makes no sense to us,” Mnuchin emphasized, replicating the position of Senate Republican Majority Leader Mitch McConnell, who considered it highly unlikely to sanction a large aid package as the November 3 presidential election approaches. .

Democrats want to sanction a $ 2.2 trillion stimulus package while the Trump administration made a last $ 1.8 trillion offer.

McConnell said Tuesday that he would seek to approve a loan and guarantee plan for small businesses but Democrats said they would only approve it within a larger package.

The CARES law has the merit of having propped up consumption and mitigated the damage to small businesses caused by the pandemic, but its main provisions expired at the end of July.

An agreement with US airlines to avoid layoffs in exchange for funding salaries expired in early October, and the companies cut tens of thousands of jobs.

Last week Trump threw the negotiations into chaos when he ordered Mnuchin to suspend them, but then backtracked, and has since urged swift action.

IMF chief economist Gita Gopinath told AFP on Tuesday that a $ 2 trillion stimulus plan could boost US growth by two percentage points next year.



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