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How Trump’s Coronavirus Diagnosis Will Affect the Stimulus Package

As the news of the President getting the coronavirus was released early Friday, it had a negative effect globally. Following the news, Nancy Pelosi talked to MSNBC about the future of the stimulus package. She said that the Republicans had finally realized the gravity of the virus while adding that she would pray for the President’s quick recovery.

“This kind of changes the dynamic because here [Republicans] see the reality of what we have been saying all along. This is a vicious virus,” she said.

During the debate of the last month about how much money should be injected for the pandemic, Pelosi has constantly argued that the Republicans do not understand the significance of the virus. Even now when she and the Treasury Secretary Steven Mnuchin are hundreds of billions of dollars apart from having an agreement about the package, Pelosi remains optimistic about striking the deal.

“We always have to find a path, that is our responsibility to do so, and I believe that we will,” she said. Further adding that “We’ll find our middle ground. We’re legislators. We’ll get the job done.”

Following the downsizing by major corporations as a response to the pandemic, hundreds of thousands of layoffs were announced this week alone. The airlines industry was the most impacted as travel was cut off completely for months. As the industry suffered, it has asked for $25 billion for paying its employees. Pelosi aims to prevent furloughs in the airlines industry as part of the bipartisan plan that she wishes to pursue with Mnuchin.

Both the speaker and the Treasury Secretary held a phone call of about an hour on Friday where they discussed their point of disagreements according to Pelosi’s spokesman Drew Hammill said. He went on to add that their “discussions will continue”.

The areas of disagreement included:

  • Unemployment insurance with $600 per week in benefits, while the White House has only agreed for $400 per week
  • Funding for local and state governments for which the Democrats offered more than $400 billion while the White House proposed only $150 billion

Some of the other issues that were cited include child tax credit, earned income tax credit, child care assistance money and funds required to deal with COVID-19.

Following the phone call, on Thursday night, a $2.2 Trillion proposal was passed by the House while Mnuchin offered a $1.6 trillion package. However, 18 Democrats voted against the $2.2 trillion legislation.

On the other hand, Republicans also called for virus relief in recent months, but they believe that the demands of the Democrats are too costly. Various GOP congressional leaders, including the Senate Majority Leader, Mitch McConnell, have stressed the importance of taking the right precautions against the virus but the implementation of these precautions by some Republicans, including the President himself, were not done.

Despite the increase in jobs being lower than expected, chief of staff Mark Meadows gambled that the September jobs report was proof that the economy was on the way to recovery.

“The economy continues to be robust and it’s a V-shaped recovery. Unfortunately, that’s not what everyone is focused on this morning,” Meadows said, not wearing a mask.

Whether there is an agreement for the fiscal stimulus has also become a key for markets, specifically after the September jobs report and President Trump’s diagnosis with COVID-19.

Scott Redler, partner of T3live.com said, “I think there’s an underlying bid under the market because nobody wants to be super short if we get a stimulus approved, but you can’t be too long in case his mild symptoms turn into severe symptoms,”. He further added that “We’re in a tough spot but overall we’re still pretty constructive.”

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