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US officials more optimistic on stimulus, timing unclear
[WASHINGTON] 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.
Both sides said they made progress in talks on Tuesday, but 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.
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.
"We are starting to write the bill," she said in an interview. "Our economy needs it." While it must go through legislative steps, including approval by the House Appropriations Committee, "I am optimistic," Ms 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," Mr McConnell told reporters.
Economists say the coronavirus-ravaged US economy has held up well because of the massive injection of about US$3 trillion in support for businesses and households earlier in the year, but needs more support to avert another downturn.
But talks between the White House and congressional Democrats have dragged on for months.
After a 45-minute call on Tuesday afternoon, White House Chief of Staff Mark Meadows said Ms Pelosi and Treasury Secretary Steven Mnuchin made "good progress," but "we still have a ways to go." The differences still amount to "several hundred billion dollars," he said on CNBC, but added "Everybody is working real hard to try to make sure that we can get some kind of an agreement before the weekend at least."
Ms Pelosi and Mr Mnuchin - who is conducting the negotiations while on a trip to the Middle East - are due to speak again on Wednesday.
DEADLINE THAT'S NOT A DEADLINE
Ms 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.
Her spokesman Drew Hammill said the deadline was useful in showing the officials could reach agreement on legislative language "demonstrating that both sides are serious about finding a compromise." He said on Twitter that key committee chairs in the House and Senate to "resolve differences about funding levels and language."
The House of Representatives approved a US$2.2 trillion package while President Donald Trump's administration proposed a US$1.8 trillion rescue measure.
Mr 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 on Tuesday showed 72 per cent of likely voters support a stimulus package. The survey also showed Mr Trump had lost ground to Mr Biden, trailing by nine points at 41 per cent.
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 US$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 US$2 trillion would boost growth in the world's biggest economy by two percentage points next year, over the 3.1 per cent GDP rise currently forecast.