US Census 2020

On more stimulus, Mnuchin and Powell diverge

Powell and Mnuchin
Washington:  Everybody agrees that the U.S. economy is in tough shape now, pressed hard by two months of shutdowns and stay-at-home orders meant to slow the spread of the coronavirus. But disagreements are erupting over what to do about it.
The Congressional Budget Office now projects that unemployment rate will peak at 15.8 % in the third quarter and that economic output will contract by 5.6 % ent in 2020.
Treasury Secretary Steven Mnuchin and Jerome H. Powell, the chairman of the Federal Reserve, both testified virtually before the Senate Banking Committee on Tuesday. The two agreed that the damage to US economy could be long-lasting if policymakers did not take action. But they offered different remedies.
Mnuchin said the thing to do was to reopen the economy as quickly as possible and let it heal itself in the fall. He didn’t see an urgent need for more stimulus spending or aid to financially strapped states and cities, reported The New York Times.
But Powell warned that no matter how quickly restrictions were lifted, the economy could not fully recover until the health crisis was resolved and people felt safe resuming normal activity. He suggested that more government help would be needed to carry states, households and businesses through the crisis.
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