Van Hollen Presses Mnuchin, Powell on the Dire Need for More COVID-19 Relief

Today, U.S. Senator Chris Van Hollen (D-Md.) pressed Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin on the dire need for more COVID-19 relief, during a hearing in front of the Senate Banking, Housing, and Urban Affairs Committee. A full transcript of the Senator’s exchange during the hearing is available below and video is available here.

U.S. SENATOR CHRIS VAN HOLLEN (D-Md.): Thank you, Chairman Powell, Secretary Mnuchin for your testimony. And listening to both of you there is clearly agreement that we need more fiscal relief.

Mr. Chairman, you said on October 6th that, “too little support would lead to a weak recovery, creating unnecessary hardship for households and businesses.” And more recently, as the cases from the pandemic have accelerated, you have said, “there hasn’t been a bigger need for it in a long time,” meaning fiscal relief. And President Trump in October tweeted out, “go big or go home” to Congress. Just picking up on Senator Schatz’s comments and others – we need to get this done. We cannot go home before the end of December without addressing the urgent needs and the pain that American households and small businesses are facing. 

So, Mr. Chairman Powell, first to you. I assume you agree today with the statements you’ve made previously about the urgent need for substantial fiscal relief?

FEDERAL RESERVE CHAIRMAN JEROME POWELL: Let me say – when I said this is the most urgent need, I was talking about the whole pandemic – I was talking about the need for the CARES Act. I wasn’t trying to speak about the need for another full CARES Act at that point in time. That’s what I believe I was referring to. It was a couple of months ago.

But yes, my view really hasn't changed. I think the risk of overdoing it is less than the risk of underdoing it. That is the record of pandemics and crises. You always think you’re – people are always worried about doing too much, and you look back in hindsight and you say, we didn’t do too much. We might have done a little more and a little sooner. I think we tried to live with that lesson this time, as with the CARES Act and with the things the Fed did and other parts of government. We really did act aggressively, so I would just say that we’ve come a long way. The CARES Act did a tremendous amount of good. We can see what may be the light at the end of the tunnel with the vaccines. And I just wouldn’t want us – we at the Fed will keep at it until we are really done. I think that some fiscal support now would really help move the economy along as well – at least to guard against those downside risks we have been talking about – smaller businesses, households, and others who are directly affected.

VAN HOLLEN: Well, I agree. And with respect to state and local governments, I was listening to your discussion with Senator Kennedy, and I would say 1 million people who’ve lost their jobs is not anecdotal. That is real, as you pointed out. Those are people who no longer have an income and therefore are relying on a safety net until we get everybody back to work.

Secretary Mnuchin, again, I quoted President Trump back in October saying to Congress, “go big or go home.” Just recently, he tweeted again, “go big and be focused” – “make it big and focused.” So, do you share the President's view that we continue to need to go big on fiscal relief?  

TREASURY SECRETARY STEVEN MNUCHIN: I do believe we need more fiscal relief, and I think there’s more work to be done, as I said in my testimony. I think, fortunately, the CARES Act has worked and the numbers are better than they were two months ago, but I would urge Congress to pass something quickly to make sure we get something done in this session.

VAN HOLLEN: I couldn’t agree with you more. I know you were engaged for a period of time with Speaker Pelosi and others. What was the Trump Administration prepared to do in terms of its top-line number at that time? The Chief of Staff to the President was quoted as saying somewhere around $1.2 trillion or more. Is that accurate?

MNUCHIN: I think, as you know, we made lots of proposals along the way. There were different proposals and different components. And as I said earlier, I spoke to Leader McConnell and McCarthy and Meadows this morning and the President, and we will continue to work with Congress to try to get something done quickly.

VAN HOLLEN: Mr. Secretary, you would agree it would be a mistake to allow the emergency pandemic unemployment insurance to expire at the end of the month, right? 

MNUCHIN: I do believe that’s one of the areas –  I think there needs to be technical fixes – but I do support extending it. I also absolutely support the unspent money in the PPP being authorized to be used immediately.

VAN HOLLEN: And you also supported – and I saw the President did – funding for some for state and local government relief. I can tell you I had a conversation this morning with the General Manager of the Washington Metro Transit System. You can read on the front page of the Washington Post Metro section today that they’re going to lay off 1,200 people in December and that their budget for next year – if they don't get any more relief – contemplates another over 2,000 people.

So, I hope we will all recognize that we’ve got to do something. There seems to be a lot of running room between the two positions that have been outlined, and I just think it would be shameful if the Congress goes home – and the Administration – if we are not able to do this before the end of the month.