A new rift has opened up between the White House and congressional Republicans over the contents of a vital economic stimulus package, as talks aimed at extending relief to businesses and the unemployed remained stalled on Capitol Hill.
The White House indicated on Friday it may not support giving companies protection against coronavirus lawsuits — something congressional Republicans say must be in any new package and which businesses say will be needed if they are to bring people back to work.
The disagreements on the Republican side have delayed and complicated the talks, which will now extend past the end of the month, when federal unemployment benefits run out for millions of Americans. A testy session between the White House and congressional Democrats broke up on Thursday night without a deal.
Democrats have been opposed to the inclusion of a liability shield, arguing it would give a green light for businesses of all sizes to bring workers back to their jobs in unsafe conditions, without any legal recourse if adequate health and safety standards are not met.
Mitch McConnell, the Republican Senate majority leader, had said no agreement could be reached without it, but the Trump administration does not necessarily see it as a deal-breaker, it said on Friday.
Kayleigh McEnany, the White House press secretary, dismissed the issue as a “question for Mitch McConnell” and said that President Donald Trump’s focus was on provisions to renew jobless benefits and preventing evictions.
The White House position drew a rebuke from lobbyists for corporate America. Neil Bradley, the chief policy officer at the US Chamber of Commerce, said it was “impossible to understate what an enormous mistake” it would be for the relief bill not to contain a liability shield.
“The entire business community, universities and colleges, and local school boards across the country are all united in support for a liability safe harbour for those who adhere to public health guidelines,” he said. “Inclusion of a safe harbour is critical to reopening schools and restoring our economy.”
The rift between the White House and Republicans over liability protections follows other intraparty disagreements. Many conservative spending hawks were resistant to any stimulus in the first place, and quashed a White House effort to cut payroll taxes as part of the plan. Mr McConnell has also rejected a bid by the White House to fund a new FBI building in downtown Washington, which Mr Trump has long been pushing for.
The White House and congressional Democrats remain far from a deal on the broader package to help the US economy weather the current wave of coronavirus infections across the country.
In May, Democrats proposed $3tn in further spending, but Republicans this month said they would support a much more limited package worth about $1tn.
The failure to reach an agreement this month means that millions of Americans are set to lose $600 per week in emergency unemployment benefits introduced at the start of the pandemic, which could deliver a very serious setback to the US recovery.
While Democrats want to extend them through the start of next year, Republicans and the White House have balked, proposing a big cut in the payments instead. In their talks on Thursday night, the Trump administration proposed a short-term extension of the jobless benefits but Democrats dismissed the idea.
On Friday, Nancy Pelosi, the Democratic House speaker, said a near-term fix would fail to give long-term certainty for working Americans, or address other time-sensitive issues, such as additional funding for Covid-19 testing and food stamps.
“This is serious. This is life and death . . . the [Republican proposal] is predicated on a lower benefit for America’s working families at a time where the virus is accelerating,” she said. “We anticipate having a bill, but we’re not there yet.”
Mark Meadows, the White House chief of staff, attacked Democratic leaders for refusing to budge, complaining on Friday that they had made “zero offers in the last three days, zero”.
As well as clashing over jobless benefits, Republicans and Democrats are also at odds over aid to cash-strapped state and local governments, which Republicans do not want to see in the legislation.
There is, however, a broad consensus for a further round of direct payments to individuals from the US Treasury, worth up to $1200 per person, after similar transfers were made in April and May.
The push to protect businesses from Covid-19 related liability is being heavily backed by US insurance companies.
“I think that this kind of liability safe harbour that the Republicans are proposing as part of the bill is so important to our nation,” Evan Greenberg, the chief executive of Chubb, said on an earnings call this week.
US companies should not have to bear “the additional expense and burden of liability exposure when for those who are practising the right protocols”, he said.
Additional reporting by Robert Armstrong in New York