Top US lawmakers set meeting in hope of stimulus breakthrough

Top US congressional leaders from both political parties are set to speak on Tuesday about economic relief legislation, as they face growing pressure to strike a deal to provide more government support.

The 4pm phone summit could be pivotal for the fate of fiscal stimulus in the world’s largest economy, after months of stop-and-go negotiations and tense political stand-offs.

If US political leaders give the green light to an agreement, it could pave the way for passage of a package worth $748bn, which was presented by a bipartisan group of moderate senators earlier this week.

The call on Tuesday is expected to include Nancy Pelosi, the Democratic speaker of the House of Representatives, and Mitch McConnell, the Republican Senate majority leader, as well as Chuck Schumer and Kevin McCarthy, the minority leaders in each chamber.

The four highest-ranking lawmakers have spoken infrequently over the course of the past few years, amid deep partisan divisions over policy and politics during the Trump administration.

Throughout the year, senior Federal Reserve officials have called in vain on lawmakers to provide more fiscal support to the pandemic-ravaged economy to prevent a sharp slowdown in the near term, as well as long-term damage to businesses and the labour force.

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The end of the election campaign has offered a new chance for a deal, with Joe Biden, the president-elect, calling for action from Congress even before he takes office in January.

On Tuesday, after waiting for weeks, Mr McConnell recognised Mr Biden’s victory over president Donald Trump, which could improve the atmosphere on Capitol Hill.

Mr McConnell said on Tuesday afternoon that he was determined to deliver a deal before members of Congress leave Washington for the holidays: “We’re not leaving here without a Covid package,” he said at a press conference. “It’s not going to happen.”

Meanwhile, rank-and-file US lawmakers from both parties have been facing growing pressure from constituents and business groups to reach a compromise in light of surging coronavirus cases and evidence that the labour market rebound has slowed.

The bipartisan package under consideration would offer $300bn in aid to small business and $180bn for unemployment benefits, as well as help for other struggling sectors such as airlines and government funding for education and healthcare programmes.

The two most contentious provisions throughout the talks — including liability protection for companies and aid to state and local governments — were stripped out of the legislation to facilitate a solution.

If a stimulus deal advances after Tuesday’s call, it could be paired with a deal to fund the government and prevent a shutdown of federal operations at the end of this week. On Tuesday, Ms Pelosi spoke for more than an hour with Steven Mnuchin, the US Treasury secretary, about the potential for compromise on both those matters.

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