Will Congress Pass New Stimulus Before the Elections?

The United States House of Representatives recently passed a $2.2 trillion stimulus package to help the American economy face the impact of the Coronavirus (COVID) pandemic.

The bill was passed by the Democratic majority in the house, however, objections from Republicans mean the relief package is not likely to pass the Senate, and it could also be vetoed by President Donald Trump, who announced on Friday that he and his wife have tested positive for the novel disease.

The Republican Party believes that the cost of the Democrats plan is too high.

Originally, the Republicans were aiming for a pack of $1 trillion or less, while the Democrats wanted a relief plan of more than $3 trillion.

According to Reuters, the Speaker of the House, Nancy Pelosi, and Treasury Secretary Steven Mnuchin discussed the new stimulus package on Friday.

Talks are set to continue, as per recent media reports.

More than $3 trillion of relief and stimulus measures have already been approved. However, as the situation of the pandemic did not improve in the United States, both parties know that the troubled economy and millions of families who lost their primary income source need new support.

“Our negotiations with the administration continue, and I am hopeful that we can reach an agreement.”

“However, we still have significant disagreements in key areas.”

said Nancy Pelosi

These areas included aid to state and local governments, unemployment insurance, provisions on testing and tracing, and Democratic demands for a child tax credit, she said.

President of the Federal Reserve Bank of St. Louis, James Bullard, recently warned that a growing number of bankruptcies due to the COVID-19 outbreak could lead to a financial crisis.

The recent policy statement and remarks by the Fed also indicated the need for more stimulus to help the economy face the hardships imposed by COVID-19.

In remains to be seen whether Democrats and Republicans will be able to bridge their disagreements and pass a new relief package ahead of the next elections, which takes place in November.