Donald Trump on Tuesday called off negotiations with Democratic lawmakers on coronavirus relief legislation until after the election, even as cases of the virus are on the rise across much of the country before flu season.
Fed chair warns of ‘tragic’ consequences without further Covid relief
“I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business,” Trump wrote on Twitter a day after emerging from a hospital stay for Covid-19 treatment.
The news triggered an immediate stock market sell off. Following Trump’s announcement breaking off negotiations, US stocks were down more than 2% in late afternoon trading.
Trump’s surprise move came after House speaker Nancy Pelosi on Sunday said during an interview with NBC’s Face the Nation that progress was being made in her negotiations with the Trump administration on a bill to build on the more than $3tn in coronavirus aid enacted into law earlier this year.
Pelosi issued a thundering statement in the wake of the announcement, accusing Trump of “putting himself first at the expense of the country” by halting negotiations over a new coronavirus aid package from Congress.
Pelosi said Trump “showed his true colors” in stopping the talks between congressional leaders and the White House that have been aimed at bringing $2tn in new aid to fight the coronavirus. The Democratic leader said by “walking away” Trump was “unwilling to crush the virus” and is abandoning the needs of children and other Americans.
Earlier on Tuesday, Federal Reserve chair Jerome Powell told a business conference the US economic expansion was “far from complete” following the deep contraction stemming from the coronavirus pandemic.
A failure by the United States to provide further relief, Powell warned, “would lead to a weak recovery, creating unnecessary hardship for households and businesses.“
In recent days, financial markets were hopeful progress toward a Covid-19 vaccine and another round of economic stimulus from Congress would boost the U.S. economy, which has been showing signs of renewed weakness.
Pelosi and Treasury secretary Steven Mnuchin had been talking regularly over the past week or so as they attempted to narrow the gap between a recent Democratic call for around $2.2tn in new spending to battle the pandemic and bolster the economy, versus around $1.6tn sought by the administration.
It was not clear whether enough Senate Republicans would have gotten behind any deal, however.
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