Mnuchin, Powell back unemployment aid, small business loans

WASHINGTON (AP) – United States (US) Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell said on Thursday that the government’s top priorities in any new economic relief package should be to provide affordable loans to small businesses and further support for millions of Americans still unemployed.

With the prospects for any new federal aid package appearing dim, members of the Senate Banking Committee pressed both officials to list improvements that could be quickly made in the nearly USD3 trillion in support that Congress has passed to fight the pandemic-induced recession that has nearly 11 million people still jobless.

Democrats on the panel urged Mnuchin, one of the administration’s top negotiators, to work harder to persuade Republicans in Congress to raise the amount of money they would be willing to support in a new bill. And Republicans urged Democratic members to consider a lower amount that might clear both the House and Senate with Election Day less than six weeks away.

Mnuchin agreed that business loans and enhanced unemployment support would be good priorities for Congress to back in any new package.

Pressed to state what the top priorities should be, Powell cited providing more support through the popular Paycheck Protection Programme (PPP) for small businesses and boosting unemployment benefits. The PPP still holds around USD130 billion that had not been allocated when authorisation for the programme expired.

The original relief package provided a USD600-a-week federal unemployment benefit, on top of whatever jobless aid a state provides. But the USD600 benefit has expired. Many Republicans have argued that amount was so large as to dissuade some unemployed people from looking for a job.

US President Donald Trump signed an executive order to provide USD300 in weekly benefits, with states supplying USD100. But that programme has not been widely supported by states and has now expired.

Powell and Mnuchin testified this week before committees in both the House and Senate that are providing oversight of programmes created to deal with the economic fallout from the pandemic.

Treasury Secretary Steve Mnuchin testifies during the Senate’s Committee on Banking, Housing, and Urban Affairs hearing examining the quarterly CARES Act report to Congress on Capitol Hill in Washington. PHOTO: AP