Covid relief bill logjam broken after Senate Democrats strike benefits deal

Senate leaders and moderate Democratic senator Joe Manchin have struck a deal over emergency jobless benefits, breaking a logjam that had stalled the party’s 1.9 trillion dollar Covid-19 relief bill.

The compromise, announced by the West Virginia senator and a Democratic aide late on Friday, seems to clear the way for the Senate to begin a marathon series of votes and, eventually, approval of the sweeping legislation.

The overall bill, US President Joe Biden’s foremost legislative priority, is aimed at battling the killer pandemic and nursing the staggered economy back to health.

It would provide direct payments of up to 1,400 dollars to most Americans and money for Covid-19 vaccines and testing, aid to state and local governments, help for schools and the airline industry and subsidies for health insurance.

Shortly before midnight, the Senate began to take up a variety of amendments in rapid-fire. The votes were mostly on Republican proposals virtually certain to fail but designed to force Democrats to cast politically awkward votes.

More significantly, the jobless benefits agreement suggested it was just a matter of time until the Senate passes the bill. That would ship it back to the House, which is expected to give it final congressional approval and send it to Mr Biden for his signature.

White House press secretary Jen Psaki said Mr Biden supports the compromise on jobless payments.

Friday’s lengthy stand-off underscored the headaches confronting party leaders over the next two years – and the tensions between progressives and centrists – as they try moving their agenda through the Congress with their slender majorities.

Mr Manchin is probably the chamber’s most conservative Democrat, and a kingmaker in the 50-50 Senate. But the party cannot tilt too far to the centre to win Mr Manchin’s vote without endangering progressive support in the House, where they have a mere 10-vote majority.

Helping unemployed Americans is a top Democratic priority. But it is also an issue that drives a wedge between progressives seeking to help jobless constituents cope with the bleak economy and Mr Manchin and other moderates who have wanted to trim some of the bill’s costs.

Mr Biden noted Friday’s jobs report showing that employers added 379,000 workers — an unexpectedly strong showing. That is still small compared to the 10 million fewer jobs since the pandemic struck a year ago.

Mr Biden said: “Without a rescue plan, these gains are going to slow. We can’t afford one step forward and two steps backwards. We need to beat the virus, provide essential relief, and build an inclusive recovery.”

The overall bill faces a solid wall of Republican opposition, and Republicans used the unemployment impasse to accuse Mr Biden of refusing to seek compromise with them.

“You could pick up the phone and end this right now,” senator Lindsey Graham said of Mr Biden.

But in an encouraging sign for Mr Biden, a poll by The Associated Press-NORC Centre for Public Affairs Research found that 70% of Americans support his handling of the pandemic, including a noteworthy 44% of Republicans.

The House approved a relief bill last weekend that included 400 dollar weekly jobless benefits – on top of regular state payments – until August. Mr Manchin was hoping to reduce those costs, asserting that level of payment would discourage people from returning to work, a rationale most Democrats and many economists reject.

As the day began, Democrats asserted they had reached a compromise between party moderates and progressives extending emergency jobless benefits at 300 dollars-a-week into early October.

That plan, sponsored by senator Tom Carper, also included tax reductions on some unemployment benefits. Without that, many Americans abruptly thrown out of jobs would face unexpected tax bills.

But by midday, members of Congress said Mr Manchin was ready to support a less generous Republican version. That led to hours of talks involving White House aides, top Senate Democrats and Mr Manchin as the party tried finding a way to salvage its unemployment aid package.

The compromise would provide 300 dollars-a-week, with the final cheque paid on September 6, and includes the tax break on benefits.