Trump says 'really good chance' of US stimulus deal

US President Donald Trump said talks with Democrats on a new stimulus bill are going well

President Donald Trump said Thursday he now sees “really good” odds of reaching a deal with Democrats in Congress on a new round of coronavirus stimulus to boost the battered US economy, a sharp reversal from his stance earlier this week.

His comments marked a definitive about-face after he abruptly ended the negotiations with Congressional Democrats on Tuesday and saying the stimulus package would have to wait until after the November 3 election.

House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin had been bargaining for weeks, raising hopes for a huge, new relief package, but Trump abruptly accused Pelosi of not negotiating in good faith and order Mnuchin to cut off the talks.

On Thursday, Trump told Fox Business, “We’re starting to have some very productive talks” — referring specifically to proposals for assistance for airlines and $1,200 checks for workers. 

“We’re talking about a bigger deal than airlines,” he said. “I think we have a really good chance of doing something.”

The sudden end to talks caused an outcry among both parties and among business leaders while sending the stock market plunging. 

Later on Tuesday, the president shifted gears and called for Congress to “immediately” pass standalone legislation to extend aid to airline workers and small businesses.

Pelosi responded on Thursday, saying no such legislation would get through Congress without a broader stimulus package aimed at building on the $2.2 trillion CARES Act passed in March as the pandemic hit, key provisions of which have recently expired.

“I have been very open to having a standalone bill for the airlines, or part of a bigger bill. But there is no standalone bill without a bigger bill,” the top Democrat in Washington told reporters.

Pelosi acknowledged that the two parties had found areas of agreement, but said Republicans “have walked away from the full package.”

– ‘Not anybody’s fault’ –

Shortly after talks were halted, Trump said he wanted Congress to “immediately” pass a separate $25 billion airline relief measure and $135 billion to protect small businesses.

Democrats seized on the president’s statement, pointing out that just last week Republicans blocked a standalone bill to prevent massive layoffs by airlines.

US air carriers are a particular concern for lawmakers. Facing a sharp downturn in travel demand caused by Covid-19, they received billions in aid under the CARES Act this year in exchange for refraining from layoffs until October.

But hoped-for additional aid did not come, and American and United airlines last week said they would begin furloughing 19,000 and 13,000 workers, while indicating the moves could be walked back if there is a breakthrough in Congress.

Trump struck a more conciliatory tone with Fox Business, saying “it’s not anybody’s fault” the talks were not successful.

“It wasn’t going anywhere, I shut it down. I don’t want to play games. Then we reopened, and I see markets are doing well,” Trump said, highlighting one of his favored measures of success.

Around 1700 GMT, the Dow was trading 0.3 percent higher following Wednesday’s day of solid gains.

Pelosi and Mnuchin spoke by telephone twice Wednesday about a new stimulus package, and were due to talk again Thursday, according to her staff.

Economists say a new round of government support is critical to prevent a wave of layoffs and bankruptcies and provide support for the unemployed.

The Labor Department reported Thursday that new applications for jobless benefits held at the very high level of 840,000 last week, and more than 25.2 million people in the United States were receiving some form of government aid in the week ended September 19.

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