Negotiations over US Covid-19 relief bill remain in flux as key benefit expires

Negotiations over America’s next Covid-19 rescue bill remained in flux on Friday, as the virus posed new risks to parts of the midwest and south, the death toll rose and extra federal payments that helped avert financial ruin for millions of unemployed people were set to expire.

Mitch McConnell, the Senate majority leader, sent senators home ahead of the weekend, promising a Republican proposal for new relief efforts would be ready on Monday. But Democrats warned that time was wasting amid GOP infighting as the crisis spirals.

As Republicans struggled, the nation’s infections passed 4 million and the number of deaths rose by several thousand to nearly 145,000. New jobless claims topped 1m and the unemployment rate stood at 11%, higher than during last decade’s Great Recession.

Republican senators disagree with White House

Senate Republicans had been expected to unveil their counterproposal this week to a $3tn bill relief bill Democrats passed in May. But GOP lawmakers and the Trump administration remained divided over key aspects of the proposal in a head-spinning week of start-and-stop progress.

McConnell’s proposal was expected to include a fresh round of direct $1,200 cash payments to Americans, along with $105bn to help reopen schools, $25bn for virus testing and McConnell’s top priority of a liability shield to protect businesses, hospitals and others against Covid-19 lawsuits.

Senate Republicans got the president to abandon his push for a payroll tax break, which they argue does little to help out-of-work Americans. But the White House added new priorities in turn. Those include money for a new building to replace the FBI’s ageing J Edgar Hoover Building in downtown Washington, across the street from the newer Trump hotel.

One sticking point is how to cut the $600 weekly jobless benefit boost the federal government has added to the weekly unemployment checks that states send since the start of the pandemic. That benefit officially expires on 31 July, but due to the way states process unemployment payments, the cutoff was, in effect, on Saturday.

Republicans largely believe the add-on is too robust and becoming a disincentive for returning to work. Under McConnell’s plan, senators proposed cutting it to $200 and then transitioning over the next few months to a new system more closely linked to state’s own payment levels. An administration official granted anonymity to discuss the private talks said the White House viewed that proposal as too “cumbersome” and the $200 boost as too high. The White House floated cutting the unemployment benefits boost to as little as $100.

Pelosi rejects temporary benefits extension

The House speaker, Nancy Pelosi, on Friday rejected the idea of a temporary extension of the enhanced unemployment benefits.

“I would be very much averse to separating [unemployment benefits] out and lose all leverage [on Republicans] for … meeting all of the other needs,” Pelosi told reporters.

Richie Neal, the Democratic chairman of the House ways and means committee, said the country was on “the eve of an economic catastrophe”.

“People need the sustenance of day-to-day life,” Neal said at the Capitol. He said the extra aid not only helped cash-strapped families but was key to fueling the economy as Americans go without paychecks. “The recovery is going to be slow,” he said.