Treasury Secretary Steven MnuchinSteven Terner MnuchinOn The Money: Initial jobless claims rise for 2nd week | Dow dips below 30K | Mnuchin draws fire for COVID-19 relief move | Manhattan DA appeals dismissal of Manafort charges Mnuchin to put 5B in COVID-19 relief funds beyond successor’s reach The Hill’s Morning Report – Presented by the UAE Embassy in Washington, DC – Trump OKs transition; Biden taps Treasury, State experience MORE signaled that he will move $455 billion in COVID-19 relief from the Federal Reserve back into the Treasury’s General Fund, a move that would make it harder for his successor to access the emergency funding.
Mnuchin said last week that he was shuttering a handful of the Fed’s emergency lending facilities, a move the central bank opposed in a rare critical statement. Those facilities, though little used during the pandemic, were seen as confidence boosters for capital markets.
The amount to be returned by Mnuchin was part of a $500 billion allocation in the $2.2 trillion CARES Act that President TrumpDonald John TrumpUSAID administrator tests positive for COVID-19 Kamala Harris, Stacey Abrams among nominees for Time magazine’s 2020 Person of the Year DOJ appeals ruling preventing it from replacing Trump in E. Jean Carroll defamation lawsuit MORE signed into law in late March.
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Mnuchin at the time requested the Fed return the funding, which Congress appropriated to cover potential pandemic-related losses, saying the CARES Act set a legal deadline for the facilities to expire by year’s end.
Putting the cash back into the general fund would make it harder for former Fed chair Janet YellenJanet Louise YellenMnuchin to put 5B in COVID-19 relief funds beyond successor’s reach Biden soars as leader of the free world The Hill’s Morning Report – Presented by the UAE Embassy in Washington, DC – COVID-19 fears surround Thanksgiving holiday MORE, President-elect Joe BidenJoe BidenHarris says she has ‘not yet’ spoken to Pence Kamala Harris, Stacey Abrams among nominees for Time magazine’s 2020 Person of the Year Obama: Republican Party members believe ‘white males are victims’ MORE‘s reported pick to lead the Treasury Department next year, to deploy the funds, and may require another act of Congress to do so.
Bharat Ramamurti, a former adviser to Sen. Elizabeth WarrenElizabeth WarrenKamala Harris, Stacey Abrams among nominees for Time magazine’s 2020 Person of the Year Mnuchin to put 5B in COVID-19 relief funds beyond successor’s reach No, the government cannot seize, break or ‘bypass’ pharmaceutical patents — even for COVID-19 MORE (D-Mass.) who now serves as a member of the congressional committee appointed to oversee the funds, called Mnuchin’s move “illegal.”
“This is Treasury’s latest ham-handed effort to undermine the Biden Administration,” he said on Twitter.
Neither the Treasury Department nor the Biden transition team immediately responded to a request for comment.
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Republicans on the Senate Banking Committee applauded Mnuchin, saying he was faithfully following the intent and letter of the law.
“Congress’s intent was clear: these facilities were to be temporary, to provide liquidity, and to cease operations no later than the end of 2020,” GOP lawmakers said in a letter spearheaded Committee Chairman Mike CrapoMichael (Mike) Dean CrapoMnuchin to put 5B in COVID-19 relief funds beyond successor’s reach Democrats accuse Mnuchin of sabotaging economy in dispute with Fed Shelton’s Fed nomination on knife’s edge amid coronavirus-fueled absences MORE (Idaho) and Sen. Pat ToomeyPatrick (Pat) Joseph ToomeyAppeals court rules NSA’s bulk phone data collection illegal Dunford withdraws from consideration to chair coronavirus oversight panel GOP senators push for quick, partial reopening of economy MORE (Pa.).
“With liquidity restored, we strongly support Treasury Secretary Mnuchin’s decision to close these facilities by year-end, as Congress intended and the law requires, and the Federal Reserve’s decision to return unused CARES Act funds to Treasury,” they added.
The GOP senators said Congress could take action to “revive” the facilities if the need arose. But Congress has struggled to pass extensions for key provisions of the CARES Act that expired July 31, and congressional leaders have remained deadlocked over a new coronavirus relief bill for months.
Updated at 3:42 p.m.
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