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White House considers more coronavirus aid as jobs picture worsens

[May 11, 2020] By David Morgan and Susan Heavey

WASHINGTON (Reuters) - The White House has begun informal talks with Republicans and Democrats in Congress about what to include in another round of coronavirus relief legislation, officials said on Sunday, while predicting further U.S. jobs losses in the coming months.

Officials in President Donald Trump's administration, including Treasury Secretary Steven Mnuchin and White House economic adviser Larry Kudlow, said they were holding discussions with lawmakers on issues including potential aid to states whose finances have been devastated by the pandemic.

Another White House economic adviser, Kevin Hassett, said future legislation could include food aid to help Americans struggling with hunger amid widespread job losses that have ruined the finances of many people. It also could include broadband access for those who lack it, Hassett added.

While Democrats, who control the House of Representatives, are moving to unveil new legislation as early as this week, the White House signaled it is in no hurry to pass another relief bill.

"Let's take the next few weeks," Mnuchin told the "Fox News Sunday" program.

Since early March, Congress has passed bills allocating $3 trillion to combat the pandemic, including taxpayer money for individuals and companies to blunt an economic impact that includes an unemployment rate to 14.7% in April after U.S. job losses unseen since the Great Depression of the 1930s.

"We just want to make sure that before we jump back in and spend another few trillion of taxpayers' money that we do it carefully," Mnuchin said. "We've been very clear that we're not going to do things just to bail out states that were poorly managed."

Pressure for further action may mount as the near-term economic picture worsens.

On CBS's "Face the Nation," Hassett said the U.S. unemployment rate could rise to somewhere "north of 20 percent" in May or June before the economy moves into what administration officials have said will be a robust recovery in late 2020.

The April unemployment rate announced by the Labor Department undercounts some out-of-work Americans, economists say.

Asked if the country could now be facing a "real" unemployment rate of close to 25 percent, Mnuchin replied: "We could be." Such a rate also includes people who have lost jobs and are not actively seeking employment and people considered underemployed.

IMMIGRATION ENFORCEMENT

Trump has previously threatened to withhold more coronavirus relief funds from states that limit cooperation with federal immigration enforcement - a stance critics said would exploit a public health crisis to advance political goals. Advisers said last week the White House would not consider new stimulus legislation in May.

Democrats are pushing for another massive relief bill that would include more money for state and local governments, coronavirus testing and the U.S. Postal Service.

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Treasury Secretary Steven Mnuchin addresses the daily coronavirus response briefing as U.S. President Donald Trump listens at the White House in Washington, U.S., April 2, 2020. REUTERS/Tom Brenner/File Photo

"It's not that we're not talking. We are. It's just informal at this stage," Kudlow told ABC's "This Week" program, referring to White House discussions with lawmakers.

"We're collecting ideas for next steps, which will undoubtedly be data-driven," Kudlow said.

Kudlow said he took part in a Friday conference call with House lawmakers from both parties, and plans to do the same on Monday with members of the Senate, which is controlled by Trump's fellow Republicans.

"If we go to a phase-four deal, I think that President Trump has signaled that, while he doesn't want to bail out the states, he's willing to help cover some of the unexpected COVID expenses that might have come their way," Hassett said on CNN's "State of the Union."

The White House is "absolutely" pushing for a payroll tax cut, Mnuchin said. Trump has called for a cut to the tax, which is paid by employers and workers and funds the social safety-net programs Social Security and Medicare. The proposal has garnered little congressional support.

White House predictions on the economy and how quickly a coronavirus vaccine could be rolled out were questioned on Sunday by both Democrats and Republicans.

The United States will need more tests before schools can reopen later in the year, said Republican Lamar Alexander, chairman of the Senate Health, Education, Labor and Pensions Committee.

Appearing on NBC's "Meet the Press," Alexander appeared to question the White House's ability to meet a target of having 100 million vaccine doses by autumn and 300 million by the end of 2020. Alexander called it "an amazingly ambitious goal" and added, "I have no idea if we can reach that."

No such vaccine for this pathogen has been approved though a number are under development.

Neal Kashkari, president and CEO of the Federal Reserve Bank of Minneapolis, told ABC's "This Week" he would welcome a robust recovery.

"But that would require a breakthrough in vaccines, a breakthrough in widespread testing, a breakthrough in therapies, to give all of us confidence that it's safe to go back," Kashkari said. "I don't know when we're going to have that confidence."

(Reporting by David Morgan, Susan Heavey and Heather Timmons; Writing by Heather Timmons; Editing by Lisa Shumaker, Daniel Wallis and Will Dunham)

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