who needs treats when you have bowls full of food sitting around .
take the younger dog out and do your focus and attention there , away from the distraction, no conflict . Start making her see you as a worthwhile trustworthy leader . YOU . not your cookie . You will have to work on this because the dog has so much doggy contact with her housemate .
Then you come home . After having taught this dog "being with" you now teach her "being away" . Pop her into a crate without much fanfare and no treats on coming home because that puts a premium on coming home . Let her think about what she has just experienced .
Meanwhile you are now out with the older dog going through the same steps.
You should be able to have two individuals, two dogs, each responsive to you even in the presence of the other dog.
I do this with young pups . Each assigned a name from the earliest of times , 4 to 5 weeks , whether that name remains or not . It gives them an individual indentidy . By the time they are 7 weeks of age I can have a guest over and have the pups on the lawn and call over Gus , or Mila , or Fido and only the dog who I have called out will leave the bunch and come over .
What tends to happen when you have two young dogs, neither one with much direction is that you have both dogs responding as "one" . You call one , both come , or both not !
The sooner you can start the better all training will be because you have a dog that has been helped along in becoming biddable.