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Coronavirus-Stimulus Efforts Pick Up Speed

The Wall Street Journal. logo The Wall Street Journal. 12/3/2020 Kristina Peterson
a group of people standing next to a person in a suit and tie © Stefani Reynolds/Bloomberg News

Democratic leaders signaled Wednesday they were prepared to reduce their demands for the next round of coronavirus relief, fueling hopes that an agreement could be reached with Republicans by year’s end to boost struggling businesses and households.

Congressional leaders have been mired in disagreements for months. In a sign that the partisan standoff was easing, however, House Speaker Nancy Pelosi (D., Calif.) and Senate Minority Leader Chuck Schumer (D., N.Y.) said that a new, bipartisan $908 billion relief proposal released Tuesday should serve as the starting point for talks with GOP leaders and the White House.

“In the spirit of compromise, we believe the bipartisan framework introduced by Senators yesterday should be used as the basis for immediate bipartisan, bicameral negotiations,” Mrs. Pelosi and Mr. Schumer said in a joint statement. “Of course, we and others will offer improvements, but the need to act is immediate and we believe that with good-faith negotiations we could come to an agreement.”

Democrats had coalesced earlier around a $2.4 trillion bill passed in the House, which contains measures including funding for state and local governments and food stamps, among others, which GOP proposals have excluded. Republicans leaders’ most recent bill cost around $500 billion. But on Tuesday, a new bipartisan group unveiled the $908 billion proposal, designed to help buoy workers and businesses through March.

Senate Majority Whip John Thune (R., S.D.) said Democratic leaders’ call to center negotiations around the bipartisan proposal was a move in the right direction. “They’ve gotten reasonable and I think that could help us get to a solution,” he said.

Senate Majority Leader Mitch McConnell (R., Ky.) didn’t comment on the Democratic leaders’ statement, but he said earlier in the day that they were showing “a new willingness to engage in good faith.”

GOP leaders haven’t yet publicly moved toward Democrats in the renewed negotiations. Earlier Wednesday, Treasury Secretary Steven Mnuchin said the White House backed a GOP offer released Tuesday. That proposal, similar to Senate Republicans’ previous $519 billion bill, includes more funding for small businesses, legal protections for entities operating during the pandemic and a one-month extension of expanded unemployment-insurance programs that expire at the end of December. It doesn’t include Democrats’ desired funding for state and local governments.

“The president will sign the McConnell proposal that he put forward yesterday,” Mr. Mnuchin said Wednesday. Mr. Mnuchin said the White House was reviewing the new bipartisan proposal. President Trump hasn’t weighed in on the discussions, but White House press secretary Kayleigh McEnany said Wednesday that Covid-19 aid was a priority.

On the Senate floor Wednesday, Mr. Schumer said Mr. McConnell “should not waste the Senate’s time on another inadequate, partisan proposal, and instead should sit down with Democrats to begin a true, bipartisan effort to quickly meet the needs of the country.”

While most lawmakers have long agreed more aid is needed, many feel more urgency now. Legislative time is running out, the pandemic is accelerating and several relief initiatives approved earlier this year are set to expire at month’s end, including unemployment insurance and expanded paid family and sick leave. A new Federal Reserve report said economic growth began to slow last month in parts of the Midwest and Northeast as coronavirus cases proliferated.

In part, Democrats are willing to scale back their demands for the next aid package because they know President-elect Joe Biden will push for more funding next year, aides said, giving them a potential second shot at more aid.

On Wednesday Mr. Biden said that any relief package passed during the lame-duck session “at best is only going to be a down payment on what’s going to happen early next year.” He said his transition team “is already working on what I will put forward in the next Congress to address the multiple crises we are facing, especially the economic crisis and Covid.”

On Monday night, Mrs. Pelosi and Mr. Schumer sent Mr. McConnell a new proposal, whose contents they have declined to disclose. Lawmakers and aides involved in the discussions said that proposal totaled around $1.3 trillion.

Some Democrats who weren’t part of crafting the bipartisan proposal signaled support for it, including Sen. Chris Murphy (D., Conn.) Shortly after being sworn in Wednesday, new Sen. Mark Kelly (D., Ariz.) said relief shouldn’t wait until next year.

“Compromise is always a positive thing and we need a bipartisan approach to this,” he said.

The bipartisan plan, initially unveiled with the backing of nine senators and the 50 members of the Problem Solvers Caucus in the House, was also drawing new support from more Republicans. Sen. Shelley Moore Capito (R., W.Va.) said Wednesday that she would back it. Sen. Rob Portman (R., Ohio) also called it “the basis for getting something done before the end of the year” on the Senate floor late Tuesday.

The bipartisan proposal would run through March 2021. It includes $160 billion in state and local funding, sought by Democrats, and gives a nod to one of Republicans’ top priorities: legal protections for businesses and other entities. Lawmakers said they would provide a short-term suspension of liability lawsuits related to Covid-19 at the state or federal level, giving states time to put in place their own protections.

The proposed package also includes $288 billion for small-business relief, including for the Paycheck Protection Program, $16 billion for the distribution of a coronavirus vaccine, $82 billion for schools, $25 billion for rental assistance and $180 billion for additional unemployment insurance, including $300 a week through March, aides said. In addition, the plan would give $17 billion to airlines.

Mr. McConnell (R., Ky.) didn’t comment on the Democratic leaders’ statement, but said earlier in the day that he saw progress, as more Democrats pushed for a smaller package. “Finally, this week we’re seeing cracks starting to form in the Democratic leaders’ stonewall,” he said Wednesday morning

Mr. McConnell on Tuesday had released the other Republican proposal. Some Republicans questioned what a new GOP proposal could accomplish, without Democratic support.

“There are message bills and then there are bills that can pass and we have to have Democratic votes to get a bill through the Senate,” said Sen. Mitt Romney (R., Utah), who helped craft the bipartisan bill.

Lawmakers hope to attach any coronavirus relief to a full-year spending bill they are trying to pass before the government’s current funding expires on Dec. 11. Senate Appropriations Committee Chairman Richard Shelby (R., Ala.) said Wednesday he was concerned the bill might not be ready in time, forcing lawmakers to pass a short-term extension to give them time to wrap up their work.

Few lawmakers want to linger in the Capitol beyond what is necessary. House Majority Leader Steny Hoyer (D., Md.) said Wednesday that congressional leaders hoped to finish up by the end of next week to give lawmakers time to quarantine before Christmas.

Write to Kristina Peterson at kristina.peterson@wsj.com

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