Coronavirus stimulus stalemate could drag on for weeks as Congress leaves town

A fifth coronavirus relief package has gone nowhere in two-and-a-half weeks as financial lifelines continue to fall to the wayside. First, a moratorium on evictions from federally-backed housing expired in late July. 

Then, enhanced federal unemployment insurance of $600 per week lapsed at the end of July. Over the weekend, the window to apply for Paycheck Protection Program small business loans closed. 

The job market has showed signs of improving despite sustained American failure to contain the virus. But even after three straight months of torrid job growth, the U.S. unemployment rate of 10.2% in July stood slightly higher than at any point during the Great Recession.

Financial markets have mostly shrugged off the the debacle in Washington, as the SP 500 hovered just below its all-time high on Thursday. 

Earlier in the day, White House economic advisor Larry Kudlow told CNBC that Democrats have asked for “too much money.” He said Democratic-backed “voting rights” measures designed to make it safer for Americans to cast ballots during the pandemic are part of “liberal, left wish lists” the president would reject.

“So far, it’s a stalemate,” Kudlow said. 

After talks collapsed, Trump took executive action over the weekend that aims to extend extra jobless benefits at a level of at least $300 per week, promote eviction protections, sustain existing student loan relief and create a payroll tax holiday. The orders could fall apart in court because Congress controls federal funding. 

In any case, governors have warned it could take outdated state unemployment systems weeks to adjust to the new rules and pay out benefits. 

It leaves an elusive deal in Congress as the most effective way to offer relief. But Pelosi, equipped with a visual aid highlighting key differences between the Democratic and GOP offers, said Thursday that the sides are “miles apart in our values.” 

They have failed to bridge a gap on unemployment insurance as Democrats push to extend the $600 per week payment. Democrats want more than $900 billion for state and municipal aid, a figure the Trump administration has called unrealistic. 

Article source: https://www.cnbc.com/2020/08/13/coronavirus-stimulus-updates-pelosi-says-no-talks-scheduled-with-white-house.html