On The Money: Shutdown politics set to collide with coronavirus aid | Bad blood between Pelosi, Meadows complicates coronavirus talks

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Happy Monday and welcome back to On The Money. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line. © Greg Nash On The Money: Shutdown politics set to collide with coronavirus aid | Bad blood between Pelosi, Meadows complicates coronavirus talks […]

Happy Monday and welcome back to On The Money. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.



Mark Meadows, Nancy Pelosi are posing for a picture: On The Money: Shutdown politics set to collide with coronavirus aid | Bad blood between Pelosi, Meadows complicates coronavirus talks | Stocks close out best August in 36 years


© Greg Nash
On The Money: Shutdown politics set to collide with coronavirus aid | Bad blood between Pelosi, Meadows complicates coronavirus talks | Stocks close out best August in 36 years

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THE BIG DEAL-Shutdown politics set to collide with coronavirus aid: The odds are rising that any deal on a fifth coronavirus relief package will be tied to legislation to prevent a government shutdown.

After weeks of stalemated talks, the timeline for the two fights have all but merged:

  • The House is set to leave until after the election by Oct. 2, giving lawmakers only a matter of weeks to get a deal on another coronavirus bill.
  • And government agencies cannot run when the next fiscal year begins on Oct. 1 without new funding from Congress.

The impact: Tying the two together would set up a high-stakes election-year battle, combining the threat of a shutdown with help for roughly 30 million Americans out of work since the spread of the coronavirus that has rattled the economy and killed more than 180,000 people in the United States. The deadline would be a month before an election both sides cast as the most important in generations. The Hill’s Niv Elis and Jordain Carney have more here.

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The spending gap: Congress is likely to need a continuing resolution (CR) to avert a shutdown. Such a bill would keep funding at existing spending levels, and the measure could serve as a vehicle for expired stimulus programs.

But both sides appear ready to blame the other if they barrel past the spending deadline and there’s no love lost between the two top negotiators.

As the parties scramble for an elusive deal on another round of coronavirus relief, mistrust and bad blood between Speaker Nancy Pelosi (D-Calif.) and White House chief of staff Mark Meadows have snarled the talks and complicated the path to a timely agreement.

While the pair of negotiators are two of the most powerful figures in Washington today, they could not be more different.

  • Pelosi, 80, a member of a Baltimore political dynasty, came up through the Democratic political machine and won her current seat 33 years ago representing liberal San Francisco.
  • She played the inside game on Capitol Hill, holding influential committee slots and steadily rising through the leadership ranks to become the first female Speaker in history in 2007.
  • Until the Trump era, Meadows, 61, had always been a political outsider excluded from the room where deals were being hashed out. The Tea Party insurgent, known for his Southern charm and coziness with reporters, first won election to his far western North Carolina House seat in 2012, but he exerted his power – and made a name for himself on the Hill – by attacking his own party leaders, derailing big bipartisan negotiations and finding his way regularly into print media and broadcast news.

The Hill’s Mike Lillis and Scott Wong tell us how that dynamic is derailing negotiations.

LEADING THE DAY

Stocks close out best August in 36 years: The stock market closed out its best August since 1984 on Monday, with major indexes gaining upwards of 7 percent.

On the final day of August trading, the Dow Jones Industrial Average retreated 228 points, or 0.8 percent, and the S&P 500 closed down 8 points, or 0.2 percent. But despite Monday’s fall, the indexes closed out the month with increases of 7.6 percent and 7.2 percent, respectively, according to CNBC, beating August returns for the past 36 years. The tech-heavy Nasdaq composite rose 80 points, or 0.7 percent, on Monday as splits in Apple and Tesla led to a rush of new buyers.

Niv has more here.

Read more: There is a growing gap between what markets are expecting and a likely wave of defaults among struggling companies before summer 2021, according to an analysis by S&P Global published Monday.

Top Fed official: Raising rates on inflation fears alone ‘hard to justify’ A top Federal Reserve official suggested Monday that the central bank would likely not raise interest rates without seeing substantial increases in prices for consumer goods.

Fed Vice Chairman Richard Clarida said in a Monday speech that raising interest rates to slow down potential increases in inflation is “difficult to justify” given how much it could restrain job growth in the process.

“Econometric models of maximum employment, while essential inputs to monetary policy, can be and have been wrong,” Clarida said Monday, according to prepared remarks.

Clarida continued, saying that hiking rates because inflation is projected to increase at a dangerous rate without seeing proof that it actually is could cause a “significant cost to the economy if the model turns out to be wrong.”

I explain here.

GOOD TO KNOW

  • Nearly 70 percent of the $1.6 billion in coronavirus stimulus payments that were sent to dead people has been recovered, a Treasury Department official told the Government Accountability Office (GAO).
  • The U.S. Department of Agriculture (USDA) will extend free meals for kids through the end of this year, as long as funding allows, following criticism from educators and parents.
  • Apple’s and Tesla’s market caps both hit record highs Monday after their stock splits went into effect, overwhelming major trading platforms in the process.
  • Amazon’s Prime Air drone delivery fleet received approval from the Federal Aviation Administration (FAA) on Monday, making it only the third company to receive certification.

Video: GOP to propose new $500 billion ‘skinny’ stimulus (CNBC)

GOP to propose new $500 billion ‘skinny’ stimulus

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