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Why new coronavirus stimulus talks are at a "dead end"

Senate Republicans last week tried and failed to pass a slimmed down stimulus bill that would have included new money for small businesses, schools and $300 in additional weekly unemployment benefits.

Driving the news: Negotiations are now at "a dead-end street,” Kansas Sen. Pat Roberts said following the bill's failure, and Florida Sen. Marco Rubio said plainly, "Congress is not going to pass another COVID relief bill before the election." In fact, we're about two weeks away from a potential government shutdown.


Why it matters: Spending is decreasing, job gains are slowing and many small businesses warn that without more assistance from the government they will run out of cash before year-end and have to shut down for good.

How it happened: Not only has the stock market boomed, U.S. data have been improving notably since May. There have been millions of jobs added and V-shaped rebounds in manufacturing and services sector reports.

  • The Axios-Ipsos poll has shown little change among respondents' ability to pay their rent or mortgage and afford household goods in the past two months.
  • And the percentage of reported layoffs, furloughs and permanent job losses at the end of August was the lowest since mid-March — though it's only one percentage point below recent levels.

What it means: "Right now there’s not a lot of evidence we need [another stimulus bill] imminently," Jim Paulsen, chief investment strategist at the Leuthold Group, tells Axios.

  • "It’s not just the stock market, it’s the data coming out every day — ISM, industrial production, housing, take your pick."
  • "If the data rolls over they’ll pass that thing in a heartbeat."

Yes, but: Economists warn the improving data mask a lingering deterioration of the economy. Things are better than they were in March and April but still far from where they were in 2019 or the beginning of the year.

  • The fact that more aid is not coming will be internalized by households that will pare their budgets and by state lawmakers who will begin laying off workers and cutting programs, Julia Coronado, president of MacroPolicy Perspectives, tells Axios.
  • "There's a lagged effect. It could unfold over weeks to months. But it's pretty clear that it’s going to be hard for the economy."

Between the lines: With new spending from Congress looking unlikely, there could be more pressure on the Fed to provide additional easing, and Wednesday's policy meeting becomes much more meaningful to the market.

Go deeper: Government shutdown looms over Congress

Biden will reverse Trump's attempt to lift travel restrictions from Europe and Brazil

The incoming Biden administration will reverse President Trump's last-minute order to lift COVID-19 related travel restrictions, Jen Psaki, the incoming White House press secretary, tweeted.

Why it matters: President Trump ordered entry bans lifted for travelers from the U.K., Ireland, Brazil and much of Europe to go into effect Jan. 26, but the Biden administration will "strengthen public health measures around international travel in order to further mitigate the spread of COVID-19," Jen Psaki said. Biden will be inaugurated on Wednesday, Jan. 20 and Trump will no longer be president by the time the order is set to go into effect.

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Dominion sends cease and desist letter to My Pillow CEO Mike Lindell

Dominion Voting Systems on Monday sent a cease and desist letter to My Pillow CEO Mike Lindell over his spread of misinformation related to the 2020 election.

Why it matters: Trump and several of his allies have pushed false conspiracy theories about the company, leading Dominion to take legal action. It's suing pro-Trump lawyer Sydney Powell for defamation and $1.3 billion in damages, and a Dominion employee has sued Trump himself, OANN and Newsmax.

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Off the rails: Inside Trump’s aborted plan to control the CIA

Beginning on election night 2020 and continuing through his final days in office, Donald Trump unraveled and dragged America with him, to the point that his followers sacked the U.S. Capitol with two weeks left in his term. This Axios series takes you inside the collapse of a president.

Episode 5: President Trump becomes increasingly rash, and devises a plan to tamper with the nation's intelligence command.

In his final weeks in office, after losing the election to Joe Biden, President Donald Trump embarked on a vengeful exit strategy that included a hasty and ill-thought-out plan to jam up CIA Director Gina Haspel by firing her top deputy and replacing him with a protege of Republican Congressman Devin Nunes.

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Biden Cabinet confirmation schedule: When to watch hearings

The first hearings for President-elect Joe Biden's Cabinet nominations begin on Tuesday, with testimony from his picks to lead the departments of State, Homeland and Defense.

Why it matters: It's been a slow start for a process that usually takes place days or weeks earlier for incoming presidents. The first slate of nominees will appear on Tuesday before a Republican-controlled Senate, but that will change once the new Democratic senators-elect from Georgia are sworn in.

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Kamala Harris resigns from Senate seat ahead of inauguration

Vice President-elect Kamala Harris submitted her resignation from her seat in the U.S. Senate on Monday, two days before she will be sworn into her new role.

What's next: California Gov. Gavin Newsom has selected California Secretary of State Alex Padilla to serve out the rest of Harris' term, which ends in 2022.

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Putin foe Navalny to be detained for 30 days after returning to Moscow

Russian opposition leader Alexey Navalny has been ordered to remain in pre-trial detention for 30 days, following his arrest upon returning to Russia on Sunday for the first time since a failed assassination attempt last year.

Why it matters: The detention of Navalny, an anti-corruption activist and the most prominent domestic critic of Russian President Vladimir Putin, has already set off a chorus of condemnations from leaders in Europe and the U.S.

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Biden picks Warren allies to lead SEC, Consumer Financial Protection Bureau

President-elect Joe Biden has selected FTC commissioner Rohit Chopra to be the next director of the Consumer Financial Protection Bureau (CFPB) and Obama-era Wall Street regulator Gary Gensler to lead the Securities and Exchange Commission (SEC).

Why it matters: Both picks are progressive allies of Sen. Elizabeth Warren (D-Mass.) and viewed as likely to take aggressive steps to regulate big business.

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Why it's harder for the far right to organize underground

Researchers see one bright spot as far-right extremists turn to private and encrypted online platforms: Friction.

Between the lines: For fringe organizers, those platforms may provide more security than open social networks, but they make it harder to recruit new members.

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