Closing on the Stimulus deal, lawmakers abolish the Fed’s role

The maneuvers put Congress’s suspicion of a relief package at a critical juncture, as coronovirus cases have increased, unemployment insurance claims remain high, and a weakening of data points underscores that American homes and businesses Struggling with near-term economic pain. Even Stoke hopes for a future rebound in the form of vaccines. Without new government support, millions of people can alleviate a foggy pandemic winter with little help at their disposal.

Mr. Tommy and other Republicans are pushing for language small and medium-sized businesses, state and local governments, and large corporations to reroute funds earmarked to support Fed credit. More dangerous for Democrats, it would also prevent the Fed and the Treasury Department from resuming new versions of key lending programs enacted this year.

As a useful tool for Mr. Biden, he will be taken off the table as he takes office in the midst of a continuing economic downturn – and angry Democrats, who Steven Mnuchin, Treasury Secretary, closed the Fed programs last month Had a blast for his decision. year’s end.

Mr. Tommy denied that he was trying to hurt the incoming Biden administration or to tank the economy. But he acknowledged that his measure was intended to prevent Democrats from taking advantage of the Fed’s emergency lending programs, a way for preferred borrowers to obtain cheap loans. The programs were meant to protect the market from breakdown, Mr. Tommy argued, not to help municipalities or loss oil and gas companies relative to green energy competitors.

“It would be a terrible idea to convert these programs into something else,” Mr. Tommy told reporters. Under some Democrat plans, he warned, “The Fed will not be the lender of last resort, it will be the lender of the first resort.”

Mr Tommy, who said the new language was “the most important thing” for him, said it was also widely endorsed by Senate Republicans and Mr Mnuchin. A senior administration official confirmed that the Treasury Secretary supported it.

Democrats condemned the move, which would leave the Biden administration with little equipment to fight the economic mess.

Bharatiya Ramamurthy, a democratic member of Congress, has been tasked to oversee the Fed’s programs. “It will limit the ability of the Biden administration and the Fed to provide credit and aid markets next year,” he said. “

Reporting was contributed by Zolan Kanno-Yongs From Washington and Nicholas Fandos from New York.

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