(Bloomberg) -- Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi failed to strike a deal for a new stimulus package during a 90-minute meeting Wednesday but said they will continue negotiating, with time running out until the election.
"We still don't have an agreement, we still have more work to do," Mnuchin told reporters, adding, "We've made progress in a lot of areas."
Pelosi, in a statement, said she and Mnuchin were seeking some "further clarification" on each others' positions and that "our conversations will continue."
The speaker said the House will go forward with a vote Wednesday night on a $2.2 trillion Democratic stimulus plan described as "our proffer" in negotiations with the White House.
That legislation is less than the $3.4 trillion bill Democrats passed in May, but still more than Republicans have said they could accept. Senate Majority Leader Mitch McConnell said earlier that it was rife with "poison pills" that have nothing to do with pandemic relief.
© BloombergHouse Speaker Pelosi Holds Weekly News Conference
U.S. House Speaker Nancy Pelosi
Photographer: Stefani Reynolds/Bloomberg
Passing it would give House Democrats campaigning for re-election a chance to tell voters that they attempted to ease some of the economic pain caused by pandemic-induced shutdowns if talks with the White House ultimately fail.
The Treasury chief suggested Wednesday morning he'd offer Democrats a proposal for roughly $1.5 trillion in pandemic assistance. He said on CNBC the administration's counter-offer to Pelosi is similar to a plan put forward by a bipartisan group of House members -- which included an escalation in spending up to $2 trillion if the coronavirus pandemic persists.
President Donald Trump has previously indicated he could accept the bipartisan proposal from the Problem Solvers group. Trump's firm support will be necessary to get a stimulus through the Republican-controlled Senate.
Officials in both parties have privately questioned whether the differences could be bridged. The lack of progress in Wednesday's talks dimmed optimism in financial markets about a stimulus deal, as stocks closed well off their highs of the session.
Private economists have increasingly abandoned predictions for a deal before the election. JPMorgan Chase & Co. and Goldman Sachs Group Inc. recently cut their forecasts for growth next quarter as a consequence.
White House Chief of Staff Mark Meadows said before Mnuchin met with Pelosi that there was still time to find a compromise, even with the election getting closer.
Eyeing Thursday
"I don't know that today has to be the drop-dead deadline," he said, adding that he'd seen "substantial movement" in the talks.
Mnuchin said earlier on Wednesday that he hopes to have an "understanding" worked out by Thursday.
A key point of disagreement has been the Democrats' push for large-scale aid to state and local governments. The plan released Monday has $436 billion for one year of assistance -- less than a previous demand for $915 billion, which triggered scorn from Trump administration officials who called it a bailout for poorly run states.
The Democratic plan includes new aid for airlines, restaurants and small businesses that wasn't in the original House package but which both sides want as part of any package. It also has more than double the amount they originally proposed for schools.
The bill would provide another round of $1,200 direct relief payments to individuals and $500 per dependent -- less than the $1,200 for dependents Democrats originally proposed. It also has $600 per week in extra unemployment benefits through January, the same amount that expired in July and helped disposable incomes surge even as the economy tipped into recession.
For more articles like this, please visit us at bloomberg.com
©2020 Bloomberg L.P.