Blue Dog Dems Push Pelosi to Reopen Negotiations

Plus, unemployment claims jump unexpectedly  [The Fisc](   By Yuval Rosenberg and Michael Rainey Blue Dog Dems Push Pelosi to Reopen Negotiations A group of moderate Democrats in the House plans to send a letter to congressional leaders urging them to start talking again about the stalled coronavirus relief bill. "As the House prepares to vote this weekend on a bill to protect the United States Postal Service, we urge you to restart bipartisan, bicameral negotiations on a fifth COVID-19 relief package that is commensurate with the scale of this public health and economic crisis," the group wrote in a draft of the letter, according to [Roll Call](. The letter comes from the Blue Dog Coalition, a House caucus with 26 members that advocates for fiscal responsibility, national defense and bipartisan consensus. The group said there is "considerable common ground" between the two sides in the negotiations, including an extension for enhanced unemployment benefits, more help for small businesses, funding for education, and another round of stimulus payments. Where things stand: Negotiations over a new relief bill broke down earlier this month, and there are currently no clear plans for restarting them, though pressure has been building for legislation of some sort. "Lawmakers from both parties are growing increasingly worried by the stalemate over a coronavirus aid package, but internal divisions on each side are complicating their efforts to propose new measures," The Wall Street Journal [reported]( Wednesday evening. More than half the House Democratic caucus has urged House Speaker Nancy Pelosi to add new funding for enhanced unemployment benefits tied to the jobless rate to the bill providing $25 billion for the Postal Service. The House is set to vote on that Postal Service legislation on Saturday. The White House, meanwhile, has been pushing for a "skinny" relief package that would include an enhanced unemployment benefit, money for the Paycheck Protection Program of loans to small businesses and another round of direct payments to individuals. White House Press Secretary Kayleigh McEnany said Wednesday that the administration would be open to $25 billion in emergency funding for the Postal Service depending on what else was included in the package. "We’re certainly open to looking at the $25 billion. But we want included in there relief for the American people that thus far Speaker Pelosi has been entirely uninterested in," McEnany told reporters. Some Senate Republicans have also floated a roughly $500 billion package — half the size of the previous GOP proposal — that reportedly is expected to include a $300 weekly federal unemployment benefit through December 27 while also providing a liability shield for businesses and hospitals, $29 billion in health-care funding and $105 billion for education. But it remains unclear if that skinnier package can garner enough support even among Senate Republicans. Unemployment Claims Jump Back Above 1 Million New jobless claims ticked higher last week, the Labor Department announced Thursday, with 1.1 million people filing for state unemployment benefits on a seasonally adjusted basis. Another 540,000 filed for claims for Pandemic Unemployment Assistance, a program that provides aid to the self-employed and to workers who have exhausted their state benefits. The increase comes after two weeks of declining first-time claims, which dropped below 1 million last week for the first time since March. It also comes as the IRS [warns]( that millions of jobs could be lost for years, with 37 million fewer jobs expected in 2021 than at this beginning of this year, before the coronavirus pandemic. A blip or something more alarming? Today’s numbers were worse than expected, but most experts say it’s too early to conclude that the economy has taken another significant stumble. "It’s not going to be simply a straight-line recovery," said Brett Ryan of Deutsche Bank. At the same time, the data make it clear that the "labor market is a long way from being healthy," Nancy Vanden Houten of Oxford Economics said in a note to clients. And despite an improving trend on unemployment, it’s worth remembering that the numbers are still shocking by historical standards, with new jobless claims exceeding the pre-Covid record set in 1982 for 22 weeks straight. "While there has been a steep decline from crisis peaks, the fact that five months into the crisis initial claims are running at 1.1 million per week is, in absolute terms, very bad news," Joshua Shapiro of the forecasting firm MFR said in a note. Heidi Shierholz of the progressive Economic Policy Institute said Thursday that the data present a strong argument for Congress to revive the enhanced unemployment benefits that expired at the end of July. "We remain 12.9 million jobs below where we were before the virus hit, and the unemployment rate is higher than it ever was during the Great Recession. Now isn’t the time to cut benefits that support jobs," she [wrote](. Looking ahead, some economists emphasized that the failure to reach an agreement on additional stimulus could be a serious problem. "If we continue to see the pullback and nothing is done by Washington, for state and local government as well, the headwinds going in to the fall are going to be huge and they could easily be a riptide that pulls us under again," said Diane Swonk, chief economist at Grant Thornton. Chart of the Day: Drug Costs for Covid-19 Patients Reuters’ Chad Terhune [reports]( "Medication costs for COVID-19 patients hospitalized in the United States have dropped sharply since May, reflecting advances in treatment, shorter stays and use of cheaper generic drugs." He adds, though, that costs may rise again as hospitals start to pay for remdesivir, the Covid treatment from drug company Gilead Sciences. Map of the Day: Coronavirus ‘Testing Deserts’ As of July 15, more than 67 million Americans, or 20% of the U.S. population, lived in census tracts that are at least 10 miles from a Covid-19 testing location, according to a [new analysis]( by GoodRx, a prescription drug discount site. All 50 states had at least one such "testing desert," the site reports, while Texas, Ohio and Michigan had the largest number of them. Testing deserts are more common in low-income counties, the report finds. The good news: Data collected by GoodRx show that from June 13 to July 16, more than 1,300 new testing sites were added nationwide, with Texas adding 293 and Arizona adding 121. The bad news: Even after months of increasing testing, the U.S. isn’t where experts say it needs to be to combat the pandemic. [Get more details at GoodRx.]( Send your tips and feedback to yrosenberg@thefiscaltimes.com. Follow us on Twitter: [@yuvalrosenberg]( [@mdrainey]( and [@TheFiscalTimes](. And please tell your friends they can [sign up here]( for their own copy of this newsletter. 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