Congress is rushing to pass a 2-day funding extension to buy more time for stimulus negotiations and avoid a government shutdown

schumer pelosi mcconnell hoyer mccarthy
From left to right: House Speaker Nancy Pelosi, Senate Majority Leader Mitch McConnell, Senate Minority Leader Chuck Schumer, and House Minority Leader Kevin McCarthy.

  • Another government shutdown looms after lawmakers failed to strike a deal on both a government funding bill and a economic relief package.
  • A number of policy disagreements continue to crop up, with one leading GOP senator describing the talks as “whack-a-mole.”
  • Hangups appear to include stimulus checks, federal aid to states through a FEMA program, and Federal Reserve lending programs.
  • Visit Business Insider’s homepage for more stories.

Congressional leaders on Friday sought to pass a two-day funding extension to keep the government open – and buy more time in a last-ditch effort to strike an elusive deal on a $900 billion federal rescue package by Sunday.

Both chambers must pass another stopgap spending bill, but it is unclear whether they would be able to do so before the clock struck midnight. The House of Representatives was expected to vote on it Friday evening.

The Senate has a different set of rules. Under the procedure known as unanimous consent, legislation requires support from every senator, meaning it only takes one to block it. Failure to pass the spending bill in both chambers and get a signature from President Donald Trump would lead to a partial government shutdown.

GOP Sen. Josh Hawley of Missouri said earlier on Friday he would oppose the stopgap spending bill unless he received more details about a fresh round of stimulus checks that are expected to be part of the relief legislation. But later in the day Hawley indicated his concerns were addressed and he would not oppose the short-term spending bill.

“I have been assured by Senate GOP leadership that #COVID direct assistance to working people IS in the #covid relief bill under negotiation & will remain,” he tweeted. “And on that basis, I will consent to a brief continuing resolution to allow negotiations to conclude.”

A lapse in funding could have little impact on agency operations if Congress resolves their impasse over the weekend. Bill Hoagland, a budget expert and senior vice president at the Bipartisan Policy Center, said essential personnel such as air traffic controllers, safety regulators, and airport security personnel would still report to work.

“A weekend shutdown, we’ve had them before,” Hoagland said in an interview. “They are not as nearly as disruptive as it would be if it began during the workweek for the American public.”

Under the weekend shutdown scenario, he said federal agencies would commence closing down on Monday if Congress failed to pass a short-term funding bill. But Hoagland said he considered that possibility unlikely given the immense pressure lawmakers are under to quickly get federal aid out the door.

Leaders in both parties came out against the idea of allowing government funding to lapse on Friday as well. House Minority Leader Kevin McCarthy said, “I’m not for a shutdown in any shape or form.” That sentiment was echoed by Majority Leader Steny Hoyer, Democrat of Maryland, who said, “we’re going to keep the government open.”

A stimulus deal reached by late Friday would be “a triumph of hope over experience”

Congressional leaders are struggling to close policy disagreements which have hobbled negotiations for several months. They are scrambling to settle those differences in a matter of days, and the talks appear very likely to slip into the weekend.

Sen. John Thune, the second-ranked Senate Republican, said anticipation of a deal struck by Friday evening would be “a triumph of hope over experience” and suggested a vote on a relief package could come early next week.

“I was thinking best case scenario of getting something voted on was ¬†going probably to be Sunday but it may be later than that,” Thune told reporters on Capitol Hill.

The hangups appear to include the details around a fresh round of stimulus payments for Americans, emergency aid to states and municipalities, and the Federal Reserve’s lending powers. But Congressional leaders are still citing continued progress in the talks.

During a speech on the Senate floor on Friday, Senate Majority Leader Mitch McConnell said he was “even more optimistic right now than I was last night” about reaching an agreement and added negotiations “remained productive.”

“The Senate will be right here until an agreement is passed, whenever that may be,” he said.

The scope of the Federal Reserve’s emergency lending programs is emerging as a last-minute sticking point in the fast-moving talks. Republicans led by Sen. Pat Toomey of Pennsylvania are seeking to cut off the central bank’s lending ability past December 31, which Treasury Secretary Steven Mnuchin set in motion last month.

Toomey, the incoming chair of the Senate Banking Committee, called it “a bright red line” for him in the relief legislation earlier this week. Those programs have backstopped the economy, supporting markets for corporate bonds and providing loans to state and local governments as well as medium-sized businesses.

But Democrats argue the move would stymie President-elect Joe Biden’s ability to stabilize the economy during a prolonged downturn. Federal Reserve chair Jerome Powell also previously said he would continue the programs into next year, but the Trump administration stepped in to end them after Dec. 31.

Congress is running up against more deadlines that could have more dire implications for many Americans if it fails to strike a deal, get President Donald Trump’s signature and enact it into law soon. Around 14 million people are threatened with the loss of unemployment aid within two weeks if certain federal programs are not renewed.¬†

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