Transcripts For CSPAN2 Fed Reserve Chair Powell Treasury Secretary Mnuchin Testify On CARES Act... 20240713

We will receive testimony from the secretary of the check treasury as required under title iv of the cares act congress has appropriated 3 trillion to protect to fight the pandemic and to stabilize the infrastructure of our economic system. A large portion of this funding is from the title iv of the cares act which has significant resources for loans and loan guarantees and other investments from the Federal Reserve with the emergency lending facilities in the states and municipalities and tribes. The title iv provided 454 billion as the infusion into the Stabilization Fund to support the emergency lending facilities that facilitated the qualities to support eligible businesses, states, local governments and tribes. And to be authorized under section 13 and to stabilize those markets but the Federal Reserve announced the establishment of the intent to establish to support the Financial Markets and businesses including some that are supported by the cares act. Last week other members of this committee and i have a robust discussion with these facilities to stress the importance like the main Street Lending programs and the Municipal Liquidity facility of stress the importance with broad access is also a disk should be successful to take into the special purpose vehicles various programs they are a critical component of a strong economic recovery which reinforces the need and flexible as possible. It contains robust oversight revisions. It is critical each federal agency follow all reporting and oversight requirements and then to ensure appropriate oversight. And then favorably out of committee and then the Congressional Oversight Committee with that oversight of title iv. And the biggest rescue package in the history of congress i look forward to hearing more on the status of the treasury loan programs those emergency programs and the Paycheck Protection Program the steps they have taken and will continue to go that way under the cares act. And how those unused funds will be prioritized and leverage to have additional liquidity to the economy. Will not part of have worked around the clock for the Paycheck Protection Program four. 3 million loans to Small Businesses mountie 515 billion according is 118,000 and during the funding it has been around 70000 on april 28 treasury and sba announced they would review all pp loans to make sure the borrowers Self Certification is appropriate sba in treasury have a safe harbor for under 2 million Commerce Committee chairman sent a letter to secretary mnuchin for the Payroll Support Program with a detailed report on the status of the program to announce those new transparency measures i encourage you to continue your work with the applicants as those funds are disbursed. I commend each of you and staff for extraordinary actions to stabilize the economy and provide support during this trying time. Thank you for joining us today in response to covid19. Thank you for following the best advice to hold a virtual hearing to prevent the spread of coronavirus. Thank you for joining us. Im so outraged by mcconnells reckless decision to keep senate in session including Capital Police officers, custodials staff cafeteria workers and everybody at risk. With those Public Health authorities advice and has no plan to get additional help for families and communities the house passed a bill that incorporates our plans the American People are rising to the challenge the leaders are failing them leader mcconnell says he sees no urgency. Those are his words would like to pause for a moment to recognize all the workers who lost their lives on the job during this pandemic. Coronavirus has brought out the best in the communities the spirit of solidarity and inspired to empower the Civil Rights Movement that spirit of solidarity applies for hospital workers and play dates as millions of individual americans pull together to do their part to flatten the curve but this pandemic how corporations claim they are now they are a cost to be minimized with the bailout of the financial crisis and how the country rewords wall street into often ignores those who make the country work. We are told we cant afford and have to raise prices nevermind ceos nevermind those prices dont do you good if your wages stay low economy has paid the price with lower Economic Growth now it is pretty clear when millions of americans are workers are laid off to make low wages to begin with now worried about the future the economy grinds to a halt. This is American Workers those who stock our shells and deliver packages and fill prescriptions. Ago she store worker in ohio said i feel safe at work and they dont pay me much i dont feel essential but expendable asking people to show up for work to risk their Family Safety finally realizing the words of doctor king ringing true that one day society will come to respect the sanitation worker picks up the garbage in the final analysis and diseases are rampant all labor has dignity you may think we are demanding more from essential workers than ever before people to take care of our families and mostly women often black and Brown Workers to get a huge way to raise. And those that are in high demand. And as essential workers after a long stressful day they wonder how they pay their rent and afford another week of groceries those are the ones that are working what about the first 35 million americans that have been laid off because of the crisis . And we try to make sure the trillions of dollars in spending like it usually does we want to make sure the fed and the treasury got this money directly into workers pockets was does it go to gas and Oil Companies with that existential threat chairman powell i appreciate your recent comments if congress does not act now to put money in the hands of people who power the economy workers and families and mainstream businesses leader mcconnell needs to let and to argue and fight with the same do Something Congress has an important responsibility also that the 500 billion already of proof from the fed and treasury is getting to workers what we know so far it does not appear this administration or the Federal Reserve are making workers their priority i look forward to hearing from both of you mr. Secretary not only what you are doing for big banks and big corporations how to make sure the money and Authority Congress gave you actually helps the people who make this country work i want to hear how it will be different this time and what you will do to transform our economy so it works for everyone not just the wealthy and powerful. Your plans to make our economy work for essential workers now and in the future and those who lost their jobs to get back to work. Now we move to the testimony secretary mnuchin your full written statements are a part of the record will go to your testimony. German crapo Ranking Member and members of the committee thank you for the opportunity to highlight how the department of treasury and the Federal Reserve are working together to provide liquidity to the Financial System the Program Support the flow of muchneeded credit families states and municipalities. And then to go forward in a safe way with proper social distancing and then to have the unprecedented challenges they are experiencing due to the covid19 pandemic. And through no fault of their own the American People are also in during economic challenges i am inspired by the medical professionals and First Responders on the front lines taking care of fellow citizens thanks to their efforts any unwavering commitment to the communities i am confident the nation will emerge from the pandemic stronger than ever before. President trump in the entire administration are provided to have necessary relief to help people get through this time the Treasury Department is working hard to implement the cares act we appreciate Congress Working with us to enact a statute that is the single long largest Economic Relief effort in the history of our country we appreciate the feedback from members of congress on both sides of the aisle as we implement a number of the critical programs established by the cares act we work closely with the Small Business administration on the Paycheck Protection Program with over 500 to keep tens of millions of hardworking americans on the payroll 400 community develop Financial Institutions many small banks in nonbanks are participating in the program more than 140 million Economic Impact payments to provide direct relief to millions of americans. The typical family of four received approximately 3400 we have distributed 150 billion to states, local and tribal governments through the Coronavirus Relief fund and also approved 25 billion of support to protect this critical sector of the economy. Turning to the central focus of the hearing today they cares act provided authority with 454 billion for the lending facilities to provide liquidity to the system and the primary Credit Facility that Money Market Fund facility, assetbacked securities, loan facilities and the secondary market. Main street Business Funding program. Municipal liquidity facility and the ppe facility. And with 200 billion with credit support under the cares act we have the remaining money and we continue to monitor a variety of sectors closely and are prepared to support these programs of the Federal Reserve as we move forward. We are sympathetic to hardworking americans in business during tremendous challenges the from covid19 we have to take unprecedented steps to shut down significant parts of the economy in the interest of Public Health we see large unemployment and other negative indicators the large number represents real people and to bring people back to work as we listen to medical experts we are optimistic about antiviral therapies and testing working system closely with the governors in a way that minimizes risk to customers and workers we expect Economic Conditions into next year. I want to conclude by thanking the hardworking People Treasury and Federal Reserve under the leadership working with all of you on a bipartisan basis with hardworking americans and businesses as quickly as possible this is unprecedented in difficult times these make a major positive impact in peoples lives together we will destroy covid19 virus in the country will emerge from this pandemic stronger than ever i look forward to your questions spent thank you secretary mnuchin. Chairman and Ranking Members of the committee thank you for the opportunity to testify today the First Quarterly hearing on the cares act. Of worldwide Public Health crisis and to be the First Responders to encourage the determination with a lasting gratitude. And those up at themselves at risk every day. And then to slow the spread of the virus. Economy has been effectively closed since march and then to make an arm the sacrifices for the loved ones and neighbors and then to make an investment as policymakers we should continue to do what we can to cushion the blow. The scope and speed of the downturn without modern president since world war ii we see a severe decline in Economic Activity and already the job gains from the last decade more than 20 Million People have lost their jobs and Research Shows what others have found that they are being hardest hit this reversal of economic fortune has caused a level of pain thats hard to capture they are upended with great uncertainty about the future. And in this challenging time they are so far falling into four categories. Outright purchases of treasuries and mortgagebacked securities. And those funding measures with the discount window measures and with those facilities with a smooth money market function so with to support the flow of credit to households and businesses in state and local governments the temporary regulatory adjustments to allow them to expand the Balance Sheets to support the business customers so far we have created 11 facilities under section 13 to support the flow of credit is all been undertaken with the treasury secretary and those that are supported from the cares act i discussed these facilities and greater length in my statement which i provided to the committee and at the fed we are committed to transparency that depends on the transparency. Thank you i will be happy to answer questions. I begin with you mr. Chairman. With regard to the municipal facility the threshold for cities and counties are established but at such a level that many of the small cities and counties across the United States do not apply for individual loans. You have indicated the states to apply for loans for the smaller cities and counties and there is a lot of concern out there. Like to ask you to clarify that these dollars do reach the small cities and counties and tell us the process by which that can be accomplished. We have been gradually expanding the scope of potential borrowers in this world and there are 50000 identities we need to draw some lines and in the first instance we said we always be willing to lend to a state to allow the purpose of down streaming to cities and counties of the governmental authority. And then continuing to look at ways to accommodate it with those relatively low populations in looking at ways to make sure to address the needs of another borrower or to. And secretary mnuchin with regards to those facilities with 500 billion with the exchange Stabilization Fund to help facilitate the implementation by the Federal Reserve. Most of that has not yet played out. Correct . Of the 500 billion approximately 50 billion was indirect lending programs for the treasury and 450 billion with those facilities i allocated half of that and i am prepared and then we are just getting these facilities up and running and with that potential for adding additional facilities. But only the suppercaseletter was given to us. In the way these work and then to a particular story and implements the facility than that money can be a leverage with that situation that is addressed. Depending on the credit risk on the leverage with the existing capital and 3 trillion in existing facilities. And whether the treasury is willing to take risk and with that i say absolutely yes. The way these work in the facilities that dont have any credit risk such as the ppe that without capital allocated by definition any facility i do put it up so it is at risk we are fully prepared to take classes in certain scenarios on the capital. There have been some allegations that those that are benefited by the facility. The announcement of the Corporate Bond facility without putting one dollar of taxpayer money but the primary and secondary markets. Companies such as boeing would need to borrow from us on a direct basis to borrow 25 billion in the primary markets so i would say in the best Case Scenario the markets open up and we dont need to use these facilities. In the case of main street facility to be up and running and to have a big impact on both of those markets. Those who of cap this country running the essential workers we all Pay Lip Service are the lowest paid workers in the economy disproportionately black and Brown Workers too often they dont have a union and lowwage workers who prepare our food and put the lives on the line to keep the country running still worried about paying the bills and stay healthy is that fair . Just for the technical issues i do not hear the beginning of your question. The people we call the essential workers are often the lowest paid workers the custodians insecurity people they prepare our food for very low wages. Is that fair . I just want to thank all the essential workers whether the healthcare people. Thanking them is great. But is it fair the economy to play so little and work conditions . Some people are paid less than others. Is that fair . Again i dont know what specific workers you are referring to. Is it fair those workers and those that make low wages we call them essential by all definition. Is that fair . And with the service sector. But there is a lot of in person contact. But all of the efforts to help those people to create conditions of the best possible chance to get back to work is to support that pandemic and to support another recovery act that has more dollars for the lowpaid workers that continue to celebrate as essential. We pass the cares act for billions of the workers to and trillions of dollars to companies and use the money that they borrow on the payroll . Just to follow the exact letter and spirit of the law we negotiated with you and others and there are some specific requirements and i assure you the chair and i are enforcing those requirements as required in the literal in spirit of negotiations. Those were nice sounding words but at the administration will send people to work without regard to their safety they are not willing with tax payer money will help them directly. The experts have told us is not safe to be open to we have Worker Protections in place to help spread one prevent the spread of covid with Contact Tracing and ppe efforts the president has clearly failed to lead to help the country there is considerable risk of not reopening . How the people die if we send them back without the protections they need . We dont intend to send anybody back into say i was prepared to come there today in fact i was wearing a mask at the senate this morning and i assure you both myself and everyone on the task force are following the best medical advice and i couldnt be more proud that we are getting in the way the economy is opening up. How many workers to give their lives and there is no National Program to provide worker safety nothing to slow the line down. How many workers should give their lives for the dow jones 51000 points. Your characterization is unfair we provide enormous amounts of equipment. I will not let you give a political speech we hear that from the president. And they still have not lead that effort playing state after State Hospital against hospital. So last week the additional fiscal support and with that economic damage so Congress Needs to think more than the National Debt right now and then to pay for the failure. And then to call out the risk. And we may need to do more as well. The administration with the stock market. And to come up with a basic plan when they go back to work and President Trump and leader mcconnell and just a couple years ago when that happens we need to spend money now to keep workers safe and spied of the comments spent thank you mr. Chairman. I would disagree with that characterization but lets move on. Mr. Chairman thank you for joining us i just want to follow up on this discussion and remind everybody while we authorize 3 trillion of direct spending and lending and then complement with 3 trillion that could be 6 trillion. Thats 30 percent of the entire annual economic output. More than half is spent or lents you can make a pretty strong case for you write a shout to do another spending bill we actually let some of the stuff go to work and understand the consequences of what we have already done i appreciate the chairman observing his comments although mischaracterized it is much more do want one new wants and that with the potential cost of new spending the comment that you made at the Peterson Institute do you still stand by that comment . I do. Expand on that. I appreciate that let me follow up on something its remembering why we shut down the economy in a firstplace that was to keep the virus from spreading so rapidly. And then and then carefully and thoughtfully and safely reopen the economy. The longest we continue a shutdown weeks turning into months doesnt that necessary increase the risk that some businesses will fail some jobs are not there to go back to. That is the case there is the risk of permanent damage. We are conscious of the Health Issues we want to be in a balanced and safeway. So for either of you for the main Street Programs first give us your best estimate when we can expect borrowers to access funds from these programs main street we expect all of them to be at the ready to go by the end of this month. That is our expectation and the funds should be foaming directly it would be possible to characterize what you have to get over to start being operational . Sure. All of them are complex and challenging main street is by itself small and mediumsize companies in the late world of bank lending negotiated documents we are trying to enter that world and make loans to qualified buyers so we set up the big operations at the Federal Reserve bank of boston and were doing all of that to face off against it. And those with different credit need some cash flow based on asset needs. And literally around the clock and have been. Also wine of the terms and conditions of these facilities the banks are a acting as lenders to participate as well with the conduits for these funds but the lender will be required to keep some of the risk on their own books so what kind of reaction have you gotten from lenders and potential borrowers what kind of participation are you anticipating is there a Strong Demand for these facilities. And going back to and then to attract Different Levels of demand with a good deal of inquiry on them and to find out fairly quickly into adapt as we have shown that it took on that uptick to find ways to address the needs of the economy. And it is critical to the response. There are 20 million jobs and 85 percent of national gdp they are facing dire circumstances. And then to have a robust recovery it with flexible relief with those physical grants to the states how would ours be. I dont want to get to into proposals those are for you. But i will just echo 13 percent a lot of the Critical Services are provided at the state and local level with balanced budget amendments and state constitutions that when revenue goes down sharply it could mean service cuts those are important things to consider going forwar forward. I just want to make a commen comment. With the Coronavirus Relief and that we passed and it is not anticipated the budgets and it was directly related. So i would urge you to look as you have done with ppe and we consider the use of flexibility in the Coronavirus Relief fund. But chairman powell will be something that will be with us for a while about 15 percent i have seen as high as 20 or 25 percent and yet the Unemployment Insurance firms will and dad a certain time. Do you think its importance to have the confidence they could have friends like this the economy is still in disarray to build in a test for competition . Spent this is a question about a specific fiscal policy we try not to get into too many specifics but the risk i called out last week and have been concerned that long periods of unemployment can affect peoples ability to go back to work and his contact with the job market so anything that keeps people intact and in the meantime it should be expansion those are appropriate things. And with the mortgage market. It seems to me we will do that again unless we have the program to provide resources to keep people in their home and to missed their mortgage payments and wall street will help and that will be as it was in oh eight and oh nine and ten and any economic recovery will be slowed by people in those conditions. So the fiscal response they cant pay the mortgages the best response. And the foreclosures and sell the finances. Lefto our communities. With that said, thinking about the 100 billion left, mr. Secretary, i think you know i feel really passionate about helping the underserved communities, whether that is orange county, South Carolina or West Virginia. Very often the smaller minority businesses are the lifeblood in those small Rural Communities and frankly we have the minority agency thats been a good job asking to deploy the resources from the triple c. Into those underserved communities. My question is how can we use some other mechanism to get more of those resources in our Rural Communities where the Paycheck Protection Program has been more intimidating than the smaller businesses like barbershops and beauty salon that may not have the banking relationship that was necessary at the beginning of the program or their 1090 nines that means basically they had to wait a week before they were able to get into the cycle. How can we help those organizations provide the marketing so the more people understand the benefits and programs . Senator scott, thank you. We appreciate the work that youve done with us on this issue you already, and we will continue to work with you and others. One of the things we are pleased abouthat in the additional mones the average loan size has come down considerably. I think we all have certain concerns about in the First Tranche of the companies were prioritized. I think thats been corrected. Im pleased with how abl abell e been to get the sole proprietors into the program to make sure the underserved communities are properly served in this program. Youve done a fabulous job under intense pressure and recognize the value of the service that you provide and im personally thankful for your accessibility to a. This is an issue that continues to grow in importance in the mortgagebacked securities there is a number of Shopping Centers in South Carolina theyve earned 20 to 22 of the folks that are able to pay their rent which means we are looking at a domino effect in the market whether it is commercial or residential the same concern. Im not sure what the answers are. Certainly it is either forbearance or bankruptcy for many firms. What should we expect and anticipate as it relates to more liquidity in the market and i do not see a panacea. What would you both suggest i tell my constituents on this important issue . It is an important market. We support the open market purchases. We continue to monitor it. Though this obviously lending facility. That is the tool we have. Not every problem can be as successfully addressed, but where it can be we are willing to take a look. Mr. Secretary, anything to add to that . I would add both working with the s. H. S. Essay and working with the staff of the securitization side, unfortunately they have certain limitations and we continue to do this. Thank you, senator menendez. State and local governments are facing unprecedented budget challenges. We are looking at an enormous budget shortfalls about to crash which will lead to a devils cocktail of devastating layoffs, public safety. To make this even worse in the combination is almost unthinkable. The bureau of labor statistics reported state and local governments laid off nearly 1 million workers in the month of april. The sideline instead. Do you agree the economy will get worse if the state and local governments are forced to lay off even more firefighters, police officers, children and Emergency Health personnel. Because of the loss of revenue due to the effect of pandemic and that is the tool that we have. I appreciate that that isnt the question. If the statesof the states, municipalities continue on the path to lay off, we have a million laid off even more just from an Economic Situation doesnt that make the economic recovery even worse . Essentially yes, senator. We have the evidence of the financial crisis and the years after words where the state and local governments layoffs and lack of hiring one of the tools that we have to alleviate this problem is by using the Money Congress provided that ran down the borrowing cost for the state and local governments so they could set the stage for the strong recovery. Frankly i do not think that is enough. In a letter we sent to you and secretary minchin recalled of the facility that would purchase medium and longterm Municipal Bonds both directly as well as from the secondary market and thereby ensure the state and local governments can continue to finance the Key Public Services and invest in infrastructure to jumpstart the economy and get americans back to work. Will you commit to work on the proposal that senator sent to you . Yes, we will take a look at that, senator. I would say those are generally to address liquidity needs and those are longerterm funding needs but notwithstanding that, we are taking a look. It can be costly but worth it if it helps avoid longterm economic damage and leads us with a stronger recovery. The tradeoff is for the elected representatives. And i agree the hit to the states, counties is tremendous and its not just specific to my state of new jersey. The projection released is that every state in the nation already or will face historic budget shortfalls. To take a few examples, they found that ohio and arizona are each facing a fiscal shock totaling about 20 of their entire state budget and for some states the numbers are even worse, like West Virginia which is facing a 40 of fisca fiscal. Like you said, the fed cant be expected to solve all of our problems. Yesterday i introduced a smart act which is a bipartisan three republicans and three democrats to provide 500 billion in direct support to state and local governments. Its the first bipartisan bill of its kind in the senate, and i think when we have colleagues from mississippi, louisiana and maine on the republican side its not a partisan issue. Would that be the type of solution that can get us back in terms of the state and the fiscal recovery . You know weve done what we can with the municipal facility but those questions or for elected representatives. Let me just close on this a lot of the businesses are not getting access to the Paycheck Protection Program as we in congress intend it. I know the secretary has been receptive and i hope that you will be as low to allowing Financial Institutions and Minority Development institutions get greater access to these programs and blending facilities set up in the care act so they can reach businesses and lowincome underserved areas of the country. Its just still not happening and i would urge the secretary that has been receptive about this, i would urge you to be receptive as well. With move to the senator who will be with us by telephone. I will stop you at about 30 seconds left and then you can proceed. Thank you, chairman and gentlemen thank you for being here. I am outside in the hallway of a judiciary committee, but im grateful for both your time and responsiveness on this. I want to start by asking about some of the cyber attacks. Weve seen an increase in scheme is depicted as Financial Institutions. I would call meanby what come a department within the treasury that is working on these issues and coordinates and makes sure that the infrastructure. I would give a pitch for the secret service will i think they can help on the cyber related issues but i assure you we have all the resources working on this jointly and taken very seriously. When we see the foreign actors doing stuff like this at this critical that we view the whole of society program. Chairman powell, the fed has done a series of announcements the last few months about the 133 lending facility. In the announcement that term assetbacked security loan to the facility would be expanded to include commercial mortgagebacked security as well as the collateral loan obligations. They described the expansion of, quote, they will in effect be guiding the worst mall malls ine country o and some of the most indebted companies. Can you get your perspective on the characterization of this expansion and are they right about the risk level with some of the property i properties obs america goes through this experience of coronavirus lots and lots of people are not just giving telecommuting and distancing that we see in Silicon Valley lots of companies are willing to migrate that strategy and that is the bellwether of where we are going to be for commercial property across america. The taxpayers shouldnt be on the hook. Can you help us understand how you would respond to the wall street journal argument . We are supporting assetbacked securities such as consumers of his car loans, credit cards, things like that. In addition to this, we are only buying the aaa rated peace and with a goodsized premise of the credit risk is actually very low and the same thing is true of the cls. That is helpful, the aaa point. Thanks mr. Chairman. Mr. Secretary, i want to go back to some idea issues that you discussed before. Obviously the intellectual property for decades and the economic rise while weve invited companies and individuals for the Cyber Espionage and some of the facts the property rarely see any sanctions for these crimes the sanctions, Money Laundering but we havent faced any sanctions and how they demanded the Treasury Department assessed the cost and benefit of utilizing the sanctions against some of the communist partys economic champions they built the site of their innovation by stealing, but the backend is obviously hooked and not just to the party but to th military intelligence. Why do we continue to treat these, quote unquote companies as if they are private sector, where do you come down on the costbenefit analysis utilizing sanctions . I dont comment on future sanctions actions, nor do i comment on specific sanction on specific companies although i will tell you that the issues related we do discuss on an interagency basis and to coordinate. I would also comment that ive worked closely with the ambassador on the china agreement enforced Technology Transfer is a major issue that weve been combating. We heard the government officials of both administrations for two decades to develop agreements that were eventually going to be beat and they almost never do. He has been a bit of a pitiful on this piece of it. But discussing it in the interagency process isnt the same as pushing to help huawei and the statebased backers understanding ip theft has consequences not just [inaudible] im glad that its a topic for interagency discussion, but i would say and i know that the german capital a place im at my time, but i would say the Intelligence Community oversight, the committee of the community of the legislature this is an increasingly bipartisan issue that republicans and democrats believe that its important for us to be holding these private Sector Companies to more account and the Chinese Government needs to know we needed and not need t eventually just somebodys going to come up the stairs and they continue to do this. So, for what its worth i think the article one perspective on the bipartisan basis is serious. Thanks mr. Chairman. Thank you. Senator tester. I want to thank both the secretary and chairman powell for being on the call today. The how active is a Congressional Oversight Commission . I cant comment on the meetings theyve had or what theyve done. Is that the values of the Inspector General. If you are referring to the noble of the eiji, which i only know iv i heard the president y that yes it is within his authority that is an appointed position he has the right. Hes nominated a new Inspector General to work with the act that we look forward to the Senate Confirming so we can work with that person. I think it is a misunderstanding of the three branches of government. I talked to you a little bit about the reporting of the eiji and i will say i learned something raised on nearly half of the dollars weve allocated, the 3 trillion has neither been spent nor lend a we need more transparency on the programs that i think you would agree. When can we see the full information about who is getting the dollars . Let me comment when we negotiated this bipartisan bill, we agreed to unprecedented transparency. So we agreed to release things that are not, so i dont know whwhy do the fancy math. You are sayinyoure saying tn about who is getting the dollars into is getting the money is already posted on the website . Every single commitment we have made is listed on the website. Every single term sheet. Every dollar amount will be listed on the website is what i heard. When we do the individual transactions through them, they are listed. Chairman powell, i look forward to seeing that list and i will go online and search it because i wanted to use a as much transparency as you set for this program as a senator from montana and a member of the banking committee, i am not seeing any of it quite frankly. Ive seen general numbers. We will deal with that at a later date. I have a question for you. Theres 3 trillion thats been put out. Can you give me an idea how many dollars except the leveraging of the facilities taken some time to set these facilities up so the amount that is going out so far is in the context of the u. S. Economy. Thertheres 200 billion be leveraged to 2. 3 trillion. Do you agree with that . Yes, potentially. We cant be precise on these numbers that we have leveraged it. Thank you very much. I appreciate you both being here and i look forward to being able to find the information. Take care. Thank you, mr. Chairman. Secretary, chairman powell. I want to speak about the primary and secondary. As of today those facilities are available. We have some of these in arkansas that are employing thousands of workers. I think possibly all of the senate is on the committee, all 50 states of companies that are in this category. Often times they go directly to Insurance Companies that are rated by the National Association of Insurance Commissioners what is the possibility of opening up those facilities to companies that are selling those kind of loans with those kind of Credit Ratings . I appreciate the opportunity that youve brought to our attention, and as ive suggested, im working with the fed very closely to see if we can accommodate using the ratings and if they need there is private ratings that can be done but isnt costly to the companies that they are committed to ensure they can use the facilities as well. Chairman powell, what is your perspective on the question fax the [inaudible] [inaudible] we are working on this problem. Thank you for that. Mr. Secretary, any thoughts on what that decision would be for some of the companies to get the certainty. To slip through the facilities to make sure we deal with those issues that they have funding on this question over the last couple of weeks, i want t wouldo the Paycheck Protection Program. Its a very specific question that i got it coming in my office this morning from one of our Small Community lenders with respect to many other lenders with the same question. Across all of the states we have this question. We are required to follow this version of 1502 by friday for all of the ones we funded for the format of the requirements issued we are reaching a critical point in time. As you know we have to extract us from the court and there will be the type. We ask for a little more detail as is followed if we have to extract the data points for the Software System that will require programming merging into the required format to the accuracy this requires several is pushing a button and it is populated. What is the prospect of getting work items as soon as possible pushing the deadline back a little bit . Mr. Senator i i believe we he already pushed that back but i will confirm it and if there is a specific institution, please let me know the name and we will figure out how to accommodate that. We want to be sure we get the information that where there are small and mediumsized banks weve wilwewill try to figure oo accomplish them. Working to iron out all of these wrinkles as the act is deployed for so many different situations. Thank you. I was healed with my time. Thank you. Senator warner. I want to start with some of the comments i think that youve made and i would want to reinforce. We realize and understand losing a job at any point in your lifetime is an enormous challenge and in the midst of a recession could be devastating. 40 of the fellow americans may close and 40,000. Theyve are at depression levels of unemployment, and i think the statistics have shown it could actually incurred long time income losses over the coming decade so the statistics that ive seen can take a moment to say we have to measure over over doing versus under doing. So this would hit the low income americans. Can you speak to us about the result there is clear evidence where people are unemployed for long periods of time that can permanently weigh on their careers and ability to go back to work and on the economy. In the families and generations it will weigh on the economies of these are things to keep in mind. It is the biggest and fastest for us. I would argue this quickly thaty whether it is our country or other nations, the governments tend to undershoot during these periods and we now have 36 million without work and those under 40,000 a year it could be discarded. One of the reasons i want to turn to you, secretary, and they have discussed this i think a number of our colleagues in the Airline Industry is an folks under 500 but that middlemarket demesne street facility is first to address i am gravely concerned we need to get out and we need to be very aggressive with it. We outlined some of the ideas i hope you would be willing to lean into, but you made mention earlier you were willing to have those at risk and id like you to speak to that a little bit more especially in terms of the baseline of this is a pity how much risk and how much capital to echo whether he is looking at the penalty fees that that are not legislated. Secretary, your first . I want to personally thank you for the time that you spent with us during the legislative process and helping to craft these different pieces and availability. As it relates to risking capital as i said almost by definition at any time the fed thinks they need capital we obviously model different scenarios. We have continued to adapt the main Street Programs with more companies into it and although we refer to it as one program it has three subprograms, so we run different scenario analysis. There are those within main street where we could lose all of our capital and we are prepared to do that and we could make a small amount of money. That is our best Case Scenario. We charge a rate that is higher than the normal rate but in most cases below th what the market s providing. That encourages property payment and those that want to save a few basis points. If the markets are functioning well we want to be a backstop to those markets. My time is up but i would urge you these are extraordinary times and i hope that you will lean into this as much as possible. Gentlemen, first of all thanks and i appreciate the work that you have done and that your organizations have done as well as a very short period of time. I would ask first of all in discussing with our local lenders they have a number of questions coming in into different sections on was the rule of which they are divvied out and accepted within ten days of the time of approval and second of all t through the june 30 date or the execution for the use of those loans. Mr. Secretary, i dont find where there is a june 30 and dave arafat has to happen in order to facilitate forgiveness of the loan. Can you talk a little bit about your options or the flexibility you have with regards to these loans and june 30 date with so many people have concerns about . They would like to get a bipartisan technical thick. As you said theres the ten days disbursement and weve given another ten days. Then theres the eightweek period. Companies are having issues where they are not necessarily able to use it during those eightweek. One flexibility that they can use it in longer than an eightweek period and as it relates to the june 30 issue we are happy to follow up on where that fits into the bill. There was a letter recommending Congress Give regulator discretion by section 171. Do you share the thinking and what measure do you think the congress and the Federal Reserve should consider . I can share that. So the idea in this unusual unique period in history the banks have been strongly making loans and taking in deposit and because of the growth on the Balance Sheets being constrained by some of these regulations because they are taking on these assets we continue and we will let you know. We still have a discretion about the amount of money that weve are and what we are going to do about it. We play a key role in how we lay out that repayment plan. Can you talk about the tools available specifically regarding the Treasury Bonds i know its been a hot topic and most recently you launched a 20 year bond. Can you talk about the majority and how you plan on laying out the strategy to best accommodate the need for the immediate liquidity but also recognizing that youve got some tools available and in these Interest Rates right now it may very well work to our benefit to figure this out over an extended period of time. Im glad you asked that question because i think its very important. But first i would answer prior to this we spent a lot of time looking at 50 and 100 year bond seemed determined that there just wasnt enough demand to make it worth it given the borrowing sizes. We did get advice on a 20 year so we added about and that gives the ability to both extend the duration as well as raise a significant amount of funds. So it is my intention as you described to borrow a lot of money in the shortterm to have the funding but then to expand the financing in the 20 and 30 year bonds. What i would like to do is walk in a significant amount of Interest Rates so the money we are borrowing can be dealt with over a long period of time. Thank you senator warren. Thank you mr. Chairman. Todays hearing takes place in the worst economic crisis of our lifetime. Unemployment is now at Great Depression levels with 40 of people making less than 40,000 that have lost their jobs in march alone. Businesses are shattered and they may never reopen. We put nearly half a trillion dollars worth of taxpayer money in Corporate Bailout money in your hands. This isnt the smallbusiness fund that half a trillion dollars from midsized and giant corporations. I want to talk a little bit about where that money is going. We have the authority to prepare rules to determine which Companies Get taxpayer relief. And how they can spend that money. Over the past few weeks, the fed has been putting these out in the form of what you call term sheets. So, you have said the job numbers will improve. In fact on fox news you said, quote, we will have a better First Quarter and better Fourth Quarter and next year is going to be a great year. To make that happen, people are going to need jobs. Does this mean you will require companies that receive bailout money from the taxpayers to keep their workers on the payroll . I have said publicly and i will say again i think the job numbers will get worse before they get better. So i think that june will be a very difficult order. As it relates to the care act, i take great pride on these those entities specifics were negotiated in each one of these programs, and it is our intent in the 133 facilities to fulfill a dispiriting details of the wall. Different facilities have different requirements. That isnt quite right. What the law specifically does s is give you a specific authority to determine the terms on which the loans were made for these corporations. Its a very simple question. You say the economy is going to recover and its going to take jobs for that to happen. So what i want to know is are you going to require companies that receive money from this half trillion dollar slush fund that have to keep people on payroll, it is a simple question, yes or no are you going to require that . The number one objective is keeping people employed. I want to be very clear on that. [inaudible] taxpayer money. That is my question. We negotiated significant restrictions on employe employer compensation and the dividends and buybacks. And in the main street facility, we have put in a provision that we expect people to use their best efforts to support jobs. I have limited time here mr. Secretary. What they understand what you are saying in all of the facilities that are not the main street facility, youre not putting in any requirements for payroll and the main street facility is a reasonable effort to be able to maintain jobs. In other words if somebody fires a bunch of people and then gets federal taxpayer money, you are fine with that or if they take a bunch of federal taxpayer money and to say it didnt work out commercially, then they can fire people. So i take that your answer to my question is whether or not it is going to require as a part of the terms of the loan people be kept is no news that right clicks that was discussed with people on both sides of the aisle. Im talking about the term sheets but you are putting out. Let me ask you one more question. Taxpayers are on the hook for nearly half a trillion dollars. Is it going to require they keep a Single Person on payroll there are some rules in the term sheets as you identified earlier like prohibiting companies from getting bailout money and by law they are going to have to find agreement certifying this area. So, here is what i want to know. What you create a certification process that ensures that the executives are held personally liable to the penalties if they provide false information or misused the bailout funds . We will review that and i would comment on programs like the Airline Programs have very specific requirements to keep jobs in. 35 million americans have filed for unemployment an and or in charge of half a trillion dollars. You are a [inaudible] i think that is a very unfair characterization. These issues were discussed with republicans and democrats at the time. You are not necessarily part of the discussions but these were completely discussed. They do not require a Single Corporation maintained one job. Thank you for being here today. I look forward to these quarterly updates. Chairman powell, when you took this responsibility there was a 5 trilliondollar Balance Sheet and you were dow youre down ab. It was about four when the covid19 crisis hit. The money supply increased from 3. 85 trillion recently with 23 trillion about two thirds of what we have done so far in the relief package and with the potential for more that would take the Balance Sheet now for 4 trillion justin march it takes up to potentially 13. 5 trillion. It is around probably 7 trillion today and it could go to 14 if in fact main Street Programs leverage it up. How do you put this back in the bottle and understand your thinking about the demand on capital and what it might do to the Interest Rates and the longterm implications of what we have just done. This isnt a criticism. I would like your thoughts on how we should be thinking about the Balance Sheet and the other Central Banks are doing fairly similar just not as dramatically as we have done. We expand the Balance Sheet so as you know we brought a lot of treasury securities to get the markets working. As these facilities grow we will also expand the Balance Sheet and that expand the money supply. I would expect that over time it will not be very soon but over time. Its both politically and economically from the end of 2014 just by holding the Balance Sheet constant from about three yearyears then we came down fro of gdp to 16 or 17 so it can be done to. For the stability or inflation concerns. I just want to thank you and echo what was said earlier and that is about your availability. I know you are recently mary and marriedand i dont know where ye is the phase but thank you for all of your set prices in making this happen. I want to correct the record we have been told in this meeting that there is no data out there but i want to highlight some verse. First of all the dodd frank bill killed about 4,000 Community Banks in six years there was a bipartisan bill in january that modified the most onerous parts of that and saved our Community Banks and they are the rock stars in this program. I have a question. We had 800 that were approved in the system prior to this from almost 5,000 banks that made it 4. 3 million loans companies under. By the way 99 of the companies with fewer who did what they wanted to do and 92 of the loans were 350,000 or less. My problem is this, i think that we have on two levels one is what is happening now and what we have done here. Weve dispense advice people to come back to work. My state is opening up safely. We have the military and essential workers and look at how they do the protocols it supports and manage the crisis. The second thing is they encourage even though they were getting money into whether revenue started they would begin to bring people in and lose the loan to pay salaries. Help us think about how to deal with that. They said they were going to put some rules out if they wanted to come back to work they would no longer be qualified for the insurance. Would you address those concerns . We want to have a technical fix on the Unemployment Insurance but specifically about the comment to offer back a worker and they dont take the job. They will be required to notify the local Unemployment Insurance agency because that person will no longer be eligible for unemployment. I want you to take us through two different scenarios. The first is that the Congress Takes no additional action in the next couple of months and the other is if Congress Steps in and passes another fiscal policy bill. I know that you are i want you to talk on the overall economy about the impact of quarters three and four should we decide to say that those weve passed our enough. I think it depends on the path of the economy honestly. As i said, my concern. The businesses are going to run out of cash within a month. States are slowly reopening the economies. But Consumer Behavior isnt going to rebalance to normal within a month. Do you think that theres going to be a Strong Enough rebound in Economic Activity in the next one to three months from what we have already done a loan to prevent thousands of Small Businesses from going under or do you think that there is the need for additional fiscal policy . I think we are going to see very quickly how to reopening those. Its very hard to say no weve not done this before. I think that you are going to be getting a lot of information very quickly in terms of what may be needed. I made my comments on fiscal policy at the general level and im reluctant to talk about timing. Its really not the best role. An openended question, please provide the panel with some comments about the importance of fiscal policy over the next six to nine months. Is a combination of a couple of things. Through the labor force because of the longer term and unnecessary avoidable. What we do is have lending power, not spending powers over time, and this isnt a certainty that a possibility. On behalf of the economy and how well the reopening those in which path we find ourselves on. The congress has done to date has been remarkably timely and forceful. We could see the same about what we have done. We need to take a step back and ask over time is it enough, and i would say we are if the need is there. It seems to me the distinction between the problems applies to the big institutions and corporations and even governments. But when you are talking about a Small Business or a family, there isnt much of a difference between having a cash flow problem and being flat broke. It seems to me that distinction that you are able to make indirectly due ahead of the Federal Reserve is a rather abstract one. With the economics of the door they dont distinguish between the solvency problem and liquidity problem. Theyve run out of money. Section 4114 states receiving the Payroll Branch shall refrain from conducting involuntary furloughs or pay rates until september 30, 2020. But on april 21, United Airlines received 4. 9 billion in the knee first, united announced that it would reduce 28,000 from fulltime to parttime within two weeks. With the announcement a violation of the terms of the Payroll Support Program . And again, please be brief. We believe right now they are in compliance with the program. Right now were they violating it when he first announced his . Again i dont want to go through specific situations with separate companies. Right now we believe they are in compliance with the agreement. Thank you. Senator. I think that your team has done a great job under immense pressure and id appreciate it. One thing i want to get back to what my colleague [inaudible] that is a good step. I personally believe that its under Severe Threat and its likely to get worse before we start seeing the turn. And in more positive Growth Indicator from the economy. One thing that im often concerned with this right now it looks like weve only got about 15 of the Hotel Association about 15 of the forbearance at any time from the Service Providers that seems like a low number to me. What more do we need to do congressionally to get the service was in far worse to the table . It does seem a bit low to me as well. We have a structural problem of loans that are in these securitizations and how they have to be dealt with soon as it relates to the banks they have a lot more flexibility but this is a technical issue and we may need to come back to congress to work with you on the technical effects. Thank you. I would like to hear about that and i am greatly concerned with Retail Shopping and Hotel Lodging industry and those are industries that are largely going to be behind some of the business startups that we are seeing in some states. I was also kind of curious about the program and potentially other areas where we should expand. Im thinking about new issues in the installment loans. Have you thought about that and also talked about the mike . [inaudible] weve thought about all of those, and i would just say i want to thank the people at the fed and the treasury that worked aroundtheclock to gearound the facilities up and running. So the tax burden right now do you think this will include a reduction and if that would be helpful quick. I think that should be seriously considered. The final line that i have come i have a growing sense we have a bit of a donut hole in some businesses with that Paycheck Protection Program for the upcoming mainStreet Lending facility. I appreciate what you said there are a lot of mechanics to be included all of that we need to look at and with that congressional action and thats why i described to be in the donut hole. But i get a sense they will have some people caught in between in that final question. Our objective is the people dont fall out in between between the ppe and the main Street Program it is objective to find a cover as many of those as possible. With the last term. Also i look forward to have mainStreet Lending thank you secretary t13 mr. Powell called for additional fiscal belief in response to senator menendez that the state and local layoffs of police and firefighters and responders making a bad Economic Situation even worse do you agree with that assessment . I recently provided guidance that they can use the money for police and fire and First Responders without restrictions i hope there is no layoffs as a result. So that just moves the burden to other Service Providers and with Public Health care workers so that just takes a bad situation to make it worse spent the congress and the senate need to address with the states or the federal government with a bipartisan basis and with that taxing authority states have balance budget requirements you can just borrow 3 trillion but it seems to me we need to take action so let me ask you about the ppe program the Bipartisan Group of senators speaking of the unilateral and unnecessary conditions that they imposed on ppe and in fact the Small Business administration ig recently said the 25 percent limit does not align with the language and then to raise another issue regarding the junh deadline but the house in the heroes act do you agree with the changes the house made . I am not familiar with the process on specific am happy to look at it but with that 75 percent issue i have spoken to senator cardin and senator rubio. Mr. Secretary i know your position i just want to highlight the position of the Inspector General of the sba you cannot find that anywhere in the statute i challenge anyone to look and find it there. Look at the rebuilding Mainstreet Initiative i do think it could get bipartisan support according to your sponsors there. Turning to chairman powell the fed has acted quickly and for the most part i have serious concerns with the actions you have taken with respect to the secondary Market Facility and in response to senator sass to emphasize that you are helping those the aaa ratings and when you look at the secondary Market Facility you purchase junk bonds and a strange situation where the same day we have unprecedented damage in terms of unemployment numbers the stock market was going up and you pointed out most of the people are there earning less than 40000 per year. And why putting money into junk bonds help those on mainstreet. In fact it puts the public in the first lost position even behind the bondholder and then decades of future cash flows. Can you respond to that concern . I would be glad to. So the highyield bonds we can buy our companies that were investmentgrade on march 22. In many cases these are very Large Us Companies with many thousands of employees and for the primary market of the corporate Credit Facility when those investmentgrade markets so a very limited narrow set of actions to support market function including buying the etfs that is a portfolio to improve market function. We may have to lend money but even better now they can borrow themselves. A lot of that is happening its the fairly intervention were not buying junk bonds across the board at all. Mr. Chairman if i could just follow up a lot of those bonds were already troubled before the intervention maybe not directly related to the pandemic but if you can get back to me its only where the fed has the authority to purchase the below Investment Grade instruments i appreciate it. Chairman powell, do you believe states and cities will experience revenue shortfall as a result of the economic lockdown because of the coronavirus . Yes i think that is what we are seeing. Will it be substantial . Yes i do. Is your Municipal Liquidity set up . Yes it is. We are probably about two weeks away from being operational. As i understand it the will by short term paper to allow the short term paper. So yes we are supporting market function across the municipal markets. You know how many states are prohibited to pay for operating expenses . Those that have a balanced budget amendment. In the state constitutions they are prohibited from borrowing money to operate the government they can to build things but not operate government are you aware of that . I thought no states could borrow for less than a year to smooth out the inflow of cash revenue anticipation notes. Right would you have any questions about the liquidity facility . Yes we have. Secretary mnuchin do you agree with what the chairman said . Yes. Let me off un observation. I dont expect you to comment come it looks like that game plan is to have senator mcconnell, senator schumer, Speaker Pelosi and you to go negotiate a deal on the next package if there is one. And then you bring the deal back to the republicans and democrats in both houses. And if the past is any indication you dont get to participate to moan and groan and follow their leaders. Im not sure this will work this time. I think whatever deal you come up with will have serious pushback from both republicans and democrats in both houses for a variety of reasons of course i could be wrong but i doubt it. Why would we not agreed to allow the states to use the 150 billion we have already appropriated to them . To address shortfalls with the revenue base as a result of the coronavirus . Senator kennedy i have no intention to do what you just described. It was done in the past it was done last time. In all fairness senator there were 20 or 30 senators that participated in the Detailed Analysis said theres a lot more members of the house and senate. Thats the way it works and we know it. We have already spent 150 billion. We know they will have shortfalls we think there is less than 50 percent chance to pass another bill why would we not allow states why we allow them to address revenue shortfalls that we both agree will exist. I appreciate your bill and i know i have the opportunity to meet with you and other senators and if there is bipartisan support i am sure the president and i look forward to that will. What would it take for you to agree to support that . I want to show bipartisan support. I have a call scheduled with you later today that the president has said if there is bipartisan support if the money has only been allocated that is something we would seriously go along with that has to be broad bipartisan support what if there were 60 votes in the senate. Please be brief. You or 15 seconds over. Im sorry i cant see the clock. Just answer that one for me. I appreciate your unanimous support. Im sorry i went over mr. Chairman. Let me start with chairman powell. This conversation we are having as you know you have highlighted some of the sectors of airlines and has on hospitality because i come from nevada the hospitality is generated with our revenue can you speak to those challenges. So the sectors of the economy where you gather people in one place and entertain them these are sectors where people take some time for the public to return it will happen but they will have to regain confidence and adapt to the new world and start traveling and taking vacations and going to restaurants. And the notion and for us to open of businesses in general but that isnt just true for hospitality for all businesses i do know and that data of 2 percent already. So how do we address this issue . So what should we be doing expect there are different sectors of the economy in the one thats most important other sectors could recover much more quickly. But people believing it is safe to go back and thats having a sensible and thoughtful part of the country something we all want. Thats what it will take people to resume their activity and with a different nature of the business and the activity. They will be healthy and safe isnt that true . But the combination of getting the virus under contro control, development of therapeutics and the vaccine and all of those things and also to see what your eyes are telling you that you can already doing things they would not have done two months ago and that process will take time. And until that happens people are relying on local and State Government and then to open businesses and get the support that is needed and Contact Tracing. That is where the decisions will be made the state and local government and we talked to allied of businesses and profits and leaders certainly for the larger ones there is a thoughtful process going on. Ultimately people make up their own mind to change the formal social distancing measures. And with pretty good confidence it is safe to go out. So the ways to make those determinations. And with that other for School Package into make that available to smaller populated states and local governments there has to be a way to get that liquidity that they need that they are providing the social safety net i know my mom my time is up secretary i will one secretary, i will submit this for the record. I will announce the vote started ten minutes ago we still have a member left to go so please Pay Attention to the clock. Thank you mr. Chairman and mr. Powell and then to ely on on these this virus with the coverup and deception the Propaganda Campaign 55 million americans have lost their jobs they destroyed samples and they stopped reckless travel with their reckless behavior that continues to be at the root of all of this. So why were here today we are really struggling people all over arizona are struggling because of the calamity from this virus. I should say i dont think we should be rewording china or individuals or entities to support the american economy. Thats not a question for me. But none of us as americans want to see chinese owned enterprises so that one Company Black box on march 24 the Federal Reserve bank has listed them as a financial agent for transactions with primary market Credit Facilities and secondary markets and during that downturn typically there is a competition or Competitive Bidding process so as you know one of the leading investment banks of chinese funds including helping Chinese Companies on the American Stock Exchange Chinese Companies listed are prohibited with the Oversight Board and firm reviewing the audit reports on the site they have a page titled the realities of investing in China State Owned Enterprises dont control the economy. I wont go into all the data but it is ridiculous this doesnt mention anything about human rights abuses or military spouses the democracy protester that is ruled by a communist party from the large investment banks and a stable freemarket and that communist run china and we are refusing to invest in these industries in america so how did blackrock get selected as a financial agent how much money do they stand to make and what if anything would prevent them to invest in interested in china and state owned enterprises . We hired blackrock for their expertise there actually an asset manager those of the markets we are concerned with primary and secondary market facilities it was done very quickly because of the urgency needed thats where it ease the these are Public Record we would be happy to supply those. What can we do to prevent profits from benefiting china and Chinese State owned companies we have invested in . All large Asset Managers by chinese securities. These are global Asset Managers. Im not here to defend or criticize but is not relevant to the work we do. We are trying to create conditions us workers can keep their jobs or return to them that is the sole purpose were not reaching out for Public Policy objectives we have a laser focus on that we concluded this company was the right want to be the fiscal agent their views on anything else are not important its important we do everything we can. Its important to all of us and thank you for your leadership to support our economy and jobs and get it back on track but also we wake up as americans and hold china accountable dont let them profit i will follow up with you on these issues i really think blackrock and others need to wake up with their patriotic duty communist china should not be profiting and that should be something for all americans regardless of blackrock. Thank you mr. Chairman we need to hold people accountable china, who Everyone Needs to be held accountable with this pandemic. Secretary mnuchin recently the treasury we saw will issue debit cards for direct payments you will recall senator cotton and i sent a letter shortly after encouraging that so i appreciate your willingness to quickly get money to millions of americans who have not seen the payments as of yet the free will Protection Program as we talk early in the first round of funding there were problems with the banks in underserved communities and we tried to correct that. But the sba Inspector General issued a report that recommended the agency start collecting demographic information on who got those loans. Can you commit to work with the sba administrator to make that the graphic information mandatory so there is that transparency . I can tell you in the forms that the lenders are require required, there is demographic information we have been advised to make that optional and not mandatory but we very help they provide that we are committed that we share the underserved communities with the money that we have left. Chairman powell, i saw the 60 minutes piece and read your comments it reminds me in to kill a mockingbird people will hear what they want to hear and see what they want to see i heard a call from action that 40 percent of americans that have lost their job not only hurts the disparities but a spotlight in so many things and you mentioned how this pandemic can exacerbate the assets of ownership between minorities and poor people in general and with those 40 million poor people get much bigger than that. What can we do to narrow the gap that the wealth gap doesnt get greater as we open back up . The job losses happening are in the Service Economy dealing with people with less wellpaying jobs the industry was hit hard with those job losses and industries. O your comment about also making sure that we keep people in their livelihoods to keep the unemployment numbers down. I think from our standpoint we have been focused on both saving lives and saving livelihoods. While we dont want to get folks incentive to stay on unemployment we certainly want to give incentives to businesses to open carefully. I would encourage you to look at the Paycheck Security Program senator warner and others are going to be following this week so that we can give these opportunities because im assuming the more opportunities we can give employers to keep people on their payroll that would aid in opening up the economy to keep us from getting into that longterm recession. Would that be fair . If i had more time i would extol the virtues of both the secretary and their chairmen and efforts to the team on their Public Service doing this in the absence of that time i hope you understand the sentiments the sentence expresses a. Weve talked about this and have seen the consequences that have come from the program. There are Large Businesses in which the facilities are being developed but i am worried about other businesses know that im lobbying for any other company but the example that comes to my mind in kansas employs almost 30,000 people. It is not investmentgrade. It has leverage and it is a company that in the absence the jeopardy of its employees are significant. Theres a lot of companies out there like that and a number of others in kansas like that and i want to make certain we are doing the things necessary to prepare to be of assistance to them. Very few others are expected not to have to take losses and earnings to be some risk taking. I want some kind of assurance that under the program these kind of companies that are hugely important to the economy with the facilities of treasury and the fed. Is there a level of comfort i can have . You have my assurance that we will look at that company and see what we can do and get back to you. There are a number of Companies Across the country not just kansas. To be clear, Companies Like that and as i said before, we want to make sure between the different facilities we are trying to do as much as we can within our power. Let me suggest timing is of the essence. I encourage thoughtful action in addressing these circumstances. Let me see if i can just two other questions. We have a time frame for further guidance in the loan forgiveness . There is some guidance that deals with most of the major issues. We are reviewing that specific request as opposed to being imminent. We are going to decide one way or another whether we can do that so, yes. Thank you very much for questioning, senator smith. Thanks to both of you for being here today we need to reopen the economy, and i quote it seems to me an important part is to make sure that americans have Accurate Information about whats going on and a lot of us were taken back when a couple of days or so ago we heard President Trump from eric trump say that they are taking away Donald Trumps greatest tool which is to be able to go into an arena filled with 50,000 people every time so that every single day between now and november 3 and guess what, after november 3, the virus will magically all of a sudden go away and disappear and everybody will be able to reopen. This is the kind of misinformation that concerns me greatly. Were you aware of any evidence of what eric trump said of his assessment is accurate . Even over the covid19 crisis many were struggling to find an affordable place to live and last year i spoke with hundreds and Family Community leaders about this challenge. Every part of the housing continuum and in Supportive Housing all the way up to the Workforce Housing that this is a significant problem and significant affordability challenge so now we have this coronavirus challenge. I along with many colleagues on the committee have been pushing for support, homeless assistan assistance, 100 billion for rental assistance and 75 billion to stabilize homeowners. What challenges do you see ahead for us as we are living through this crisis, and i appreciate what you said. The most important policy objective to keep people in their homes and paying the bil bills. These are longrunning problems and as an example, a lot of the jobs are big urban areas to get a costofliving in those places is higher and higher and often people in the Service Industries providing their services they have long times to live in a place and its an issue that has been with us for a while. I realize you dont want to comment specifically on the specific policies but in general, do you see the risk to the Housing Market as the economy continues to take a downturn in the months ahead . There are multiple risks. One is for the extent of forbearance doesnt do the job given that this is a Natural Disaster its something that would be great to avoid and also an industry coming under greater pressure. Talk about the challenges people will have if they do lose their home big impact but that has all the way up through the housing continuum is a great concern and then its important to address in this package. Thank you, senator. If you finishing her five minutes i may make it. Thank you mr. Turning into the witnesses for being here today. Every day arizona is worried about their health and future and that is why during this difficult time our goal is to offer topnotch constituent services connecting it is on a and going the extra mile to ensure they get what they need. Im glad that we are having this oversight hearing today because robust oversight is critical to ensure we know where the money is going and how it is going to be spent. Its also vital to ensure they are not stuck in the government bureaucracy to care zach thomas of Small Businesses a 10,000dollar loan advance within three days of their application. None of them got their loan advance in three days and no one receives a cool 10,000. They comment how they have significant issues getting it up and running. I will follow up and look about on the loans and rebuilding the entire system because i think as you know we have over 5,000,012 process but we will followup with you. Its totally changed the policy to only issue 1,000 loans up 10,000. The original plan was 10,000 per company. Who provides the change, and why was it made . I believe the administrator made that change. There was limited money to spread it out against as many as possible. To authorize more funding to pay for that which they appropriated and called for them in the legislation. There was additional money. They made this change without getting authorization from congress and because they didnt have enough money. We then gave enough and they give to people as promised. The last thing i will say is that my office is right now working on over 300 outstanding vital pieces and some are in midmarch we will work to follow up that side but that is not acceptable is illegal followup with you. I have some questions about the Paycheck Protection Program as well. We are asking for guidance on how the loan forgiveness works and the lack of guidance as needed difficult for Small Businesses to plan. We have received some guidance and have more to come. Can you tell me why its taken so long to get the guidance from businesses on the loan forgiveness act . This was a complicated program that we se be set up ina short period of time. Adults with all the issues but theres specific issues that you are hearing from a we will followup with you and provide the clarity. I appreciate that. We would like to follow up. As you know, the loan was only one page long. But the forgiveness application is 11 pages long and according to my staff requires a minimum of three hours to complete. This is a real problem for the mom and pop shops in arizona. But efforts can we offer for those . I spent a lot of time on the complexity to get it as short as they could under the requirements of the law. I hope it doesnt take three hours for the Small Business but we tried to as short as possible. I see that my time has expired. I would like to ask many more questions and i will submit in writing. With a 62nd statement if you could do so, please. I will in my report you all know the story they took the canary down in the mine to warn of poisonous gas. There wasnt a union Strong Enough or a government that thet cared enough. Thats why we have the new deal after decades of attacks based on the response weve heard today and what we have heard especially from the past few months it seems once again they dont have a government that cares enough to protect. They are putting their lives on the line and this administration tells us everything we need to know thats why Congress Needs to stand up and when we needed a union so we can fight back for Economic Security and safety protections for american values. Thank you for allowing the last minute or so. I also want to thank you, senator brown, for your cooperation working with us to have this hearing. I appreciate the cooperative way weve been able to work on these hearings. I do disagree with the notion the secretary and the chairman are working very hard to make sure the support we voted on gets out to those that have these lower paying jobs and better in the service industry. And those places that will be needed when we have the opportunity to do so. I do appreciate your support in helping us to get this hearing set up and working into the witnesses, i appreciate your cooperation as we put this together. With that, i will say to those that wish to submit questions for the record goes on tuesday may 26 and i ask you the witnesses to respond to those questions as quickly as possible. Again, thank you for participating today, and this hearing is adjourned