House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin continue to work on a package to support the US economy . ©AFP/File NICHOLAS KAMM
Washington (AFP) – Chances for approving a new spending package to support the US economy improved dramatically on Tuesday after the senior Democratic lawmaker said a bill is in the works and the top Senate Republican said he would bring it to a vote.US House Speaker Nancy Pelosi said on Bloomberg TV that legislators are starting to commit the measure to paper and she is optimistic it can win bipartisan support.

Whether policymakers can complete the negotiations in time for Congress to approve the package before the November 3 presidential election, however, remains a question mark.

“Our economy needs it. Hopefully by the end of the day today, we will know where we are,” she said in an interview. “We are starting to write the bill.”

While it must go through legislative steps, including approval by the House Appropriations Committee, “I am optimistic,” Pelosi said, but cautioned “Legislation is tough.”

The bill’s prospects got a boost after Senate Majority Leader Mitch McConnell, who repeatedly signaled that he would not support a massive package, said he would bring the measure to the Senate floor for a vote.

“If a Presidentially-supported bill clears the House, at some point we’ll bring it to the floor, yes,” McConnell told reporters.

Economists say the coronavirus-ravaged US economy has held up well because of the massive injection of about $3 trillion in support for businesses and households, but needs more support to avert another downturn.

The talks between the White House and congressional Democrats have dragged on for months, and Pelosi was due to speak with Treasury Secretary Steven Mnuchin to see if the sides can finally narrow their differences.

Mnuchin is conducting the negotiations while on a trip to the Middle East, where he is traveling to Israel, Bahrain and the United Arab Emirates.

– Deadline that’s not a deadline –

Pelosi on Sunday had said there were only 48 hours left to realistically agree on the package that could be approved before the election, but she explained Tuesday that the deadline was simply a process of working back on the timeline from election day.

“It isn’t that this was a day that we would have a deal, it was having the terms on the table to be able to go to the next step. Legislation takes a long time,” she said.

The House of Representatives approved a $2.2 trillion package while President Donald Trump’s administration proposed a $1.8 trillion rescue measure.

Trump, who trails in national polls behind Democratic challenger Joe Biden, signaled he could go bigger, but Senate Republicans strenuously opposed the massive price tag and McConnell was trying to push much smaller, narrowly-targeted measures..

A New York Times/Siena College poll published Tuesday showed 72 percent of likely voters support a stimulus package. The survey also showed Trump had lost ground to Biden, trailing by nine points at 41 percent.

Since business shutdowns began in March, tens of millions of workers have lost their jobs, while the economy saw the worst contraction since the Great Depression.

The $2.2 trillion CARES Act expanded unemployment benefits and provided loans and grants to small businesses. However those provisions expired months ago.

IMF chief economist Gita Gopinath told AFP last week that a US rescue package of around $2 trillion would boost growth in the world’s biggest economy by two percentage points next year, over the 3.1 percent GDP rise currently forecast.

Disclaimer: Validity of the above story is for 7 Days from original date of publishing. Source: AFP.