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‘You’ve buried the money’: Democratic senator rips Mnuchin for pulling key Covid lending programmes

Griffin Connolly
·2-min read
Trump Treasury Secretary Steven Mnuchin faced a grilling from Democratic lawmakers about his decision to pull funding for key Federal Reserve lending programmes for municipal funds, medium-sized businesses, and others. (Getty Images)
Trump Treasury Secretary Steven Mnuchin faced a grilling from Democratic lawmakers about his decision to pull funding for key Federal Reserve lending programmes for municipal funds, medium-sized businesses, and others. (Getty Images)

Senator Sherrod Brown lit into Treasury Secretary Steven Mnuchin for withdrawing hundreds of billions of dollars from Federal Reserve lending programs that have been used to buttress the economy amid the coronavirus pandemic.

“It looks like you and the president and others in the current administration are trying to spend your final days in office preemptively… sabotaging the next administration's efforts to clean up your mess,” the Ohio Democrat said in a Senate Banking, Housing and Urban Affairs Committee hearing on Tuesday.

“But you still work for the American people, even though I don't think you're acting like it, Secretary Mnuchin,” Mr Brown said.

The secretary is within his legal rights to pull the pandemic-oriented funds from the Fed’s control as outlined in the $2.2trn CARES Act from March. But Democrats and Fed Chairman Jerome Powell have argued that the US economy is still fragile and the aid still desperately needed.

Skeptics of the current administration have accused Mr Mnuchin of pulling the funds in an attempt to hamper the Biden administration’s ability to deal with the economic turbulence once it takes office.

The Fed has dished out hundreds of billions of dollars in loans to medium-sized businesses as well as state and local governments through the programmes Mr Mnuchin has decided to end.

The programmes were scheduled to sunset — Washington-speak for “expire” — by the end of the year, but stakeholders had been expecting lawmakers and Treasury to extend them for as long as the pandemic persisted.

“You've killed the CARES Act loans that were supposed to be a tool to help smaller businesses and their workers, and buried the money,” Mr Brown said at Tuesday’s hearing, using both his opening statement and his cross-examination of Mr Mnuchin to assail the Treasury secretary’s record over the last four years.

Mr Mnuchin has insisted that political considerations did not inform his decision to draw the lending programmes to a close. And he repeated his highly contested claim on Tuesday that the CARES Act requires him to take back any unused funds from the Fed lending programmes by the end of the year.

Mr Mnuchin himself has previously indicated it could be possible to extend the programmes into 2021.

“I'm surprised to hear Senator Brown use words like 'sabotage,' 'no legitimate justification,' 'delusional,' ‘malpractice.’ ... I'd be more than happy, Senator Brown, to come see you and your staff, and walk you through the legal analysis,” the secretary said on Tuesday.

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