The NPR Politics Podcast - Senators Clash Over How Soon To Reopen The Economy

Episode Date: May 19, 2020

Members of the Senate Banking Committee squabbled Tuesday over how quickly the U.S. economy can rebound from the coronavirus shutdown and whether the federal government is doing enough to support struggling families and businesses in the meantime. This episode: White House correspondent Tamara Keith, congressional reporter Claudia Grisales, and chief economic correspondent Scott Horsley.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

Hi, this is Dan, a cashier-stocker at a mid-sized grocery store in the Midwest, where we just received two pallets of the new white gold, which, for those who aren't aware of the shortage, how many of our customers are describing toilet paper. This podcast was recorded at 2.07 p.m. on Tuesday, the 19th of May. Things may have changed since this podcast was recorded, but what hasn't changed is we're all wearing masks, keeping track of each person who arrives and leaves to keep our store under its capacity limitation, and sanitizing just about everything, including each grocery cart as our customers come to shop. Okay, here's the show. Thanks. That is awesome. We are all grateful, grateful for the work that you do.

And what's the address of that store with the two pallets of toilet paper? Yeah, right. Let's go get it. Exactly. Hey there, it's the NPR Politics Podcast. I'm Tamara Keith. I cover the White House. I'm Claudia Rizales. I cover Congress. And I'm Scott Horslake, and I cover the economy. This morning, the Treasury Secretary Steven Mnuchin and the Chair of the Federal Reserve, Jerome Powell, testified before a Senate committee.

Because we have a hard stop at 1215, all senators and witnesses need to be especially mindful of the five-minute clock. Virtually, of course. You should all have one box on your screen labeled clock that will show how much time is remaining. Mnuchin has been responsible for getting out all those relief checks. And Powell has, through a variety of programs, been injecting a lot of money into the economy through the Fed's powers. And with that much money on the line, senators had some questions. Yes, this was a very different look to this hearing today. It was a completely virtual

hearing where everyone dialed in either by video conference or by a phone line and brought these two witnesses, Mnuchin and Powell, also dialing in video conference-wise. And they presented their cases to senators who wanted to hear about the CARES Act, this $2 trillion bill that was passed earlier this year and how it was going. Senators had a lot of questions about the different parts of the CARES Act. There's the PPP, the Small Business Lending Program. There are various Fed programs to provide emergency loans to mid-sized businesses and state and local governments. And of course, there were also questions about whether additional help is going to be needed. And part of that depends on how

quickly businesses are able to reopen, how quickly customers come back. And the fact that this hearing was being held on video conference sort of underlined just the challenges implicit in that. Sherrod Brown, the Democratic senator from Ohio, suggests that the administration is trying to open up the economy too quickly and putting workers at risk. So how many workers should give their lives to increase our GDP by half a percent? That you're pushing people back into the workplace. There's been no national program to provide worker safety. The president says reopen slaughterhouses. Nothing about slowing the line down. Nothing about getting protective equipment. How many workers should give their lives to increase the GDP or the Dow Jones by a thousand points? many workers should give their lives to increase the GDP or the Dow

Jones by a thousand points. No workers should give their lives to do that, Mr. Senator, and I think your characterization is unfair. Then on the other hand, you had Republican Senator Pat Toomey of Pennsylvania arguing if the government doesn't proceed with reopening the economy, workers may not have jobs to go back to. Secretary Mnuchin, the longer that we continue a shutdown, when weeks turn into months, doesn't that necessarily increase the risk that some businesses will fail, some jobs won't be there to go back to if a lockdown and a shutdown continues indefinitely? That's absolutely the case, Mr. Senator. There is the risk of permanent damage. And as I've said before, these two men are like the titans of the economy. They're the

top officials dealing with the U.S. economy. And the U.S. economy right now is in a really weird, really unprecedented place. How did they describe their view on what's going on right now and how long it might last? Yes, we did hear two kind of different views when it came to this. Mnuchin came with more of the administration's message, more optimism, more bullish on the path forward for the economy and hopes that we will see a strong recovery in the near future. On the other hand, Powell was a little more realistic, if you will, sobering, his testimony was, in terms of the path ahead. And there could be difficulties as well. And while Mnuchin acknowledged things could get worse before it gets better, Powell was a little more straight to the point in terms of what those difficulties could look like. I do think we need to take a step back and ask over time, is it enough? And we need to be prepared to act further. And I would say we are if the need

is there. And this is a point Powell has been making repeatedly in recent weeks in speeches and news conferences. He did a rare interview with 60 Minutes last weekend. He's making the point that the shock that's been caused to the economy by the coronavirus pandemic, it is temporary. That is, the economy should recover once we get this virus under control. But he warns there's a danger that the longer it drags on, the longer people are separated from work, the bigger the threat that there's really lasting damage and we dig ourselves into a hole that's harder to get out of. So Scott, when he talks about temporary, like how is he defining temporary? Because President Trump is talking about, you know, the transition to greatness,

and there could be a V-shaped recovery. And, you know, just as soon as we get past this, it's like, boom, rocket fuel. Is that what they're talking about? I think the Fed chairman's message has been more measured than that. He talks about this being a finite downturn, said the economy was in good shape before the coronavirus hit, and therefore it should be able to recover once we get the pandemic under control. But that recovery is not going to happen overnight. He's talking about something maybe towards the end of next year, perhaps.

So the need for a lifeline could be an extended need. He's not talking about a turnaround in the summer or fall, and in particular, before the November election. So as we mentioned at the top, senators had a lot of questions for Powell and Mnuchin about these rescue programs, this big spending that's been happening and how the money has been distributed. And this being Congress, the senators, Claudia, certainly were sort of making their points as they were asking their questions. They're interested in how these programs are working right now. This influences how they go forward in terms of any additional aid if they do consider that.

And we heard it from both sides of the aisle, Republicans and Democrats wanting to know how these programs are going, if they're lending out all the money they can that was approved by Congress. And we did hear that they're not quite there. And there's still a lot more work to do in terms of issuing these loans. It was interesting. I mean, some of this hearing was sort of technical and down in the very nuts and bolts of how some of these various relief programs are working. Some of it was sort of overarching, big picture, how quickly is the economy going to recover? And then some of it was sort of traditional, you know, Main Street versus Wall Street. And you saw an example of that when Senator Elizabeth Warren of Massachusetts was questioning both the Treasury Secretary and the Fed chairman about some of the emergency lending

programs that the Fed is running for larger corporations. Warren complained that there aren't enough strings attached to that money and that companies that take advantage of those loan programs aren't required to keep workers on the payroll. You know, we're in a situation where 35 million Americans have filed for unemployment. You're in charge of half a trillion dollars. You're boosting your Wall Street buddies, and you are leaving your people behind. Senator Warren, I think that's a very unfair characterization. And these issues were discussed with both Republicans and Democrats at the time. You were not necessarily part of those discussions, but these were completely discussed.

Secretary Mnuchin draws a distinction there between programs like the PPP, which really do incentivize companies to keep workers on the payroll, to use that taxpayer money to pay employees, and some of the Fed's lending programs, which are bankrolled in part by taxpayer dollars, but which are largely just money off the printing presses and where those requirements to keep workers on the payroll are not part of the plan. All right, we are going to take a quick break. And when we get back, what this hearing tells us about the chances for another relief bill. Support for NPR and the following message come from DuckDuckGo. Do you want the same internet but more privacy? DuckDuckGo can help. They help millions of people like you get

privacy online without any trade-offs. With one download, you can search and browse privately, avoiding trackers. DuckDuckGo. Privacy simplified. On Bullseye this week, Tina Fey on creating unbreakable Kimmy Schmidt, 30 Rock, and being the best at everything. There was a window of time when we would just go to awards things and pick up our prizes and party with the people from Mad Men. That's this week on Bullseye for MaximumFun.org and NPR. And we're back. And certainly a question underlying much of the conversation in this hearing was about whether, when, how, what size, there might be another relief package. What did this hearing do in terms of pushing that forward or defining the contours? Well, one thing it does is lay out where folks sit now in terms of the last CARES bill, the $2 trillion bill that was approved a few weeks ago,

and how are they doing with all of that funding in terms of distributing it. So that gives Republicans a little more information. They say they want more information before they move forward on how this bill is going. And this was confirmation of that. That also ties into comments that Senate Majority Leader Mitch McConnell made later after the hearing. He suggested that it was time to wait. We still believe with regard to the coronavirus, we need to assess what we've already done, take a look at what worked and what didn't, and we'll discuss the way forward in the next couple of weeks. And we also saw President Trump.

He came to the Hill to meet with Senate Republicans for lunch. So that also could signal additional conversation there on Republicans reconsidering this pause and wait, or perhaps moving closer to a plan of maybe going back to the negotiating table this summer. At the same time, we heard Democrats grilling these witnesses saying there's no need to wait. Yeah, I mean, there's been a lot of focus on the CARES Act, on the PPP, the Small Business Lending Program, and some of the other lending programs. But it's almost faded from memory. And it wasn't even that long ago, there were these $1,200 checks that were sent to most Americans to sort of help them pay their bills if they're out of

work or otherwise boost the economy. And a lot of people have paid those bills and have more. Is there a conversation about doing that again? there is going to be pressure, at least from some quarters, for another round of either stimulus payments to everybody or targeted payments to the people who are still without work, the tens of millions of Americans who are still without work. And countered against that, you do have the slow reopening of some businesses in some parts of the country. It's still, you know, restaurants are only seating a quarter as many people as they used to, and the customer counts are still way down. But it's going to be kind of a foot race now to see if the relief lasts longer than the economic pain does, or if not, whether there's another round of help on the way. Yeah, and I guess that gets to the bigger question of what does reopening look like? And it seems pretty clear that it's not just flipping a switch.

It's a gradual process, even in the places that say, oh, the doors are open. Absolutely, and we've seen that around the country in those areas where they've been more aggressive in reopening. Customers have not necessarily come back in great numbers. Certainly, there's a lot come back in great numbers. Certainly, there's a lot of pent-up demand. People are anxious to see their friends and maybe belly up to a bar someplace. But there's also a lot of caution, and that's going to continue until we actually get to the other side of the pandemic. All right. Well, that is a wrap for today. And I know it is Tuesday, but Friday comes up fast and we need your help. Every week we end the show with our favorite segment, and I think yours, Can't Let It Go, where we talk about the things from the week that we cannot stop thinking about politics or otherwise.

We want to know what you can't let go of. Just record yourself on your phone and email it to nprpolitics at npr.org. Remember, keep it to like 20 seconds. That's the best. Can't wait to hear what you can't let go of. I'm Tamara Keith. I cover the White House. I'm Claudia Garizales. I cover Congress.

I'm Scott Horsley. I cover the economy. And thank you for listening to the NPR Politics Podcast.