WASHINGTON (REUTERS) – US House of Representatives Speaker Nancy Pelosi on Thursday (Oct 8) said legislation to help airline companies survive the fallout from the coronavirus pandemic was a matter of national security and could only move through Congress with guarantees that lawmakers will work on a more comprehensive aid Bill.

In an interview with Bloomberg TV, Pelosi also expressed confidence that she and Treasury Secretary Steven Mnuchin will be able to reach an agreement on the amount of aid in new legislation to “crush” Covid-19 cases, which are still rampant in the United States.

Pelosi said there was “a clear understanding” that airline aid had “to be in the context of a fuller Bill. They don’t have to happen at the same moment but they have to be happening with the assurance that we will go beyond the assistance to the airlines.”

Earlier, at a weekly news conference, Pelosi said, “There is no standalone Bill without a bigger Bill.”

The Democratic speaker particularly wants to dispatch hundreds of billions of dollars to state and local governments to help them grapple with falling revenues and worries of laying off police, firefighters and other front-line workers as the pandemic hobbles the US economy.

Rather than pass a comprehensive Bill, along the lines of a measure approved in mid-May by the Democratic-controlled House, the Trump administration is focused on providing separate “standalone” Bills.

Besides helping struggling US airlines, they want to deliver another round of US$1,200 (S$1,600) direct payments to Americans.

US stocks, which have been highly sensitive to the talks, dipped following Pelosi’s comments at her press conference.

“We’re at the table. We want to continue the conversation. We’ve made some progress, exchanging language, and then, so we’ll see how we connect,” Pelosi told reporters referring to negotiations with Mnuchin.

Senate Majority Leader Mitch McConnell, at a news conference in his home state of Kentucky, said, “We do agree that another rescue package is needed. We have vast differences about how much we should spend.”

He said the looming Nov 3 US elections have made it harder to reach a bipartisan compromise.

Earlier on Thursday, Trump told Fox Business network in a telephone interview about talks, “Now they are starting to work out.”

Two days ago, he cut off negotiations via a post on Twitter.

Pelosi spoke to Mnuchin on Wednesday evening and the two were scheduled to talk again on Thursday, according to Pelosi aide Drew Hammill.

Democrats have been pushing for US$25 billion in new aid to alleviate airline companies’ planned layoffs. But they have called for at least US$2.2 trillion in wide-ranging aid, while top Trump aides have signalled a willingness for around US$1.6 trillion.

Trump’s remarks early on Thursday were one more lurch in a roller-coaster week in which he had reversed his call for intensive negotiations on a new coronavirus aid Bill by proclaiming that there would be no more talks on a deal until after the Nov 3 presidential and congressional elections.

Trump, who was diagnosed last week with Covid-19, is trailing Democratic presidential candidate Joe Biden in public opinion polls less than a month before the election.

Worries over the pandemic top voters’ concerns and Trump has gotten low marks on his handling of it.

Meanwhile, White House economic adviser Larry Kudlow told Fox News that the US economic recovery does not depend upon another stimulus Bill, despite warnings from Federal Reserve chairman Jerome Powell that action was needed.

But Kudlow added that the administration wants to see “standalone” Bills to provide additional unemployment assistance, an extension of the Paycheck Protection Program small business loans, stimulus cheques for individuals and education aid.

All these components would make for a package with a high price tag – possibly well beyond anything Senate Republicans would support.

Two conservative Republicans, Senators Mike Lee and Pat Toomey, on Thursday questioned any new aid to US airlines, saying that no other Fortune 500 firms have received taxpayer-funded grants and that they should rely on existing long-term federal loans.

“The excess capacity of the airline sector will not be resolved in the near future and continuing to force the entire payroll obligation onto the taxpayers is not sustainable,” Toomey and Lee said in a statement.

Many Senate Republicans have baulked at spending anything over US$1 trillion in new aid, with some of them opposed doing anything beyond the more than US$3 trillion enacted earlier this year.

McConnell, a Republican, wants to concentrate in the weeks before the election on confirming Amy Coney Barrett to the US Supreme Court vacancy created by the death of Justice Ruth Bader Ginsburg.

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