'You have to be optimistic': Pelosi hopes for Covid stimulus by Election Day as negotiations enter third month

Deal could be worth more than $2trn and would bring much-needed relief to millions of Americans hit by the pandemic

Speaker Nancy Pelosi has signalled new optimism about striking a deal with the White House on a coronavirus relief package before Election Day.

Such a deal, which could be in the ballpark of more than $2trn, would greenlight a second round of stimulus checks for American taxpayers similar to the $1,200 direct payments they received in the spring.

It would also include billions of additional dollars in forgivable loans for small businesses that desperately need cash during the pandemic to keep US employees on payrolls through the winter.

“It may not be finished by Election Day, it may be,” Ms Pelosi said on Tuesday in an interview with Bloomberg TV.

“But I wanted it by next Friday. I want it in time for people to pay their rent November 1,” she said.

The two “bookends” separating House Democrats and the White House remain Democrats’ insistence on billions more in funding for state and local governments and Republicans’ insistence on liability protections for businesses, hospitals and schools where people might be exposed to Covid-19.

Senate Majority Leader Mitch McConnell has said providing such entities a shield from lawsuits stemming from exposure to the virus is a “red line” Democrats must observe in order to strike any new relief deal.

But Mr McConnell’s budget-wary Republican colleagues in the Senate appear to be the primary holdup as negotiations enter their third month without a final product.

National debt hawks such as Senators Ted Cruz of Texas and Rand Paul of Kentucky skewered the White House in July and August over an initial proposal worth $1.2trn, a mark Democrats and White House negotiators have blown past as the weeks have dragged on without an agreement.

At the same time Mr Trump has urged Congress to “go big” on a Covid-19 relief deal, Mr McConnell has teed up votes this week on a bill worth a fraction of the administration’s latest offer to Ms Pelosi.

Senate Republicans balked at the price tag of the White House’s $1.8trn offer last week, and have sought to put the pressure back on Democrats by bringing a “targeted” bill to the Senate floor that would inject roughly $500bn into key Treasury Department programmes aimed at helping keep small businesses afloat during the pandemic.

Ms Pelosi and Senate Minority Leader Chuck Schumer have made clear Democrats will not approach coronavirus relief in a “piecemeal” fashion because it allows Republicans to kick the can on Democratic priorities such as election assistance, greater funding for testing and contact tracing, and money for states and municipalities on the front lines of the pandemic response.

Ms Pelosi’s talks with Treasury Secretary Steven Mnuchin have proceeded in fits and starts since Congress returned to Washington after its July 4th holiday with ambitions of reaching a deal by the August recess.

In the meantime, Mr Trump — with whom Ms Pelosi has not directly spoken in nearly a whole year — has abruptly cut off the negotiations, said the speaker has “mental problems,” and now argued for a more expensive package than even the Democrats are asking for.

Ms Pelosi and Mr Mnuchin, seemingly the one person in the administration she feels she can negotiate with in good faith, have another call scheduled for Tuesday afternoon.

“You have to be optimistic. If we didn’t believe we could get this done, why would we even be talking?” Ms Pelosi said in her Bloomberg TV interview on Tuesday.