UPDATED on March 23, 16:53 PM: The “Coronavirus relief” bill was blocked by Democrats. Republicans say the Democrats blocked the bill over partisan, non-related issues.
The coronavirus menace is wreaking havoc throughout the world, casting dark clouds over the global economy. In the United States, the Congress is finalizing a coronavirus economic relief bill that will consist of a one-time $3,000 payment for families.
Also, the bill will enable the Federal Reserve to leverage up to $4 trillion of liquidity to support the nation’s economy, according to the U.S. Treasury Secretary Steven Mnuchin.
While speaking to the ‘Fox News Sunday’ television program on March 22, Mnuchin stated that the extra liquidity strategies would enable the United States central bank to help a broad base of businesses to survive through the next 90-120 days.
President Trump’s administration hoped to finalize this bill on March 22 and see a vote on March 23, according to Mnuchin. He added that more measures could be implemented if this financial crisis did not recede in the coming 10 to 12 weeks.
The U.S. economy will take a major hit from this health crisis. But, the government is hopeful that it will rebound strongly once COVID-19 is contained. Mnuchin added:
“We need to get the money into the economy now. If we do that, we think we can stabilize the economy.”
Currently, at least 80 million people were under orders to remain at home. So far, New Jersey, New York, Connecticut, Illinois, and California have instituted statewide lockdowns aiming to contain the rapid spread of the virus.
The U.S. Treasury Secretary downplayed recession fears and termed questions headed in that direction as ‘technical questions’ that are not ‘relevant’ currently. The government decided to shut down a significant part of the economy to slow the spread of the deadly virus. Mnuchin explained:
“When people focus on recessions, it’s normally because of a prolonged economic environment. This is a unique situation that we’ve never had before. This is the government has self-imposed shutting down large parts of the economy. And as soon as we can get the medical situation under control, we’re going to reopen it.”
As much as the government is trying to mitigate the current financial impact of the coronavirus, the printing of up to $4 trillion increases the risks of hyperinflation in the U.S.
Mnuchin avoided commenting about reports that the Trump administration was reluctant to act on multiple warnings about the potential impacts of COVID-19 on the U.S. economy.
Allegations emerged that the U.S. intelligence community had warned about the pandemic but the government states that nobody expected that the crisis would escalate as rapidly as it had. Mnuchin commented:
“I don’t think that anybody should second guess the government’s actions. This has been moving very quickly, and I think we’ve responded appropriately.”
Critics were quick to say that the administration has been quite slow in its preparation and response to the crisis. They said that President Trump played down the situation for weeks before he abruptly changed his tone more recently.