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Mnuchin defends CARES Act implementation

Treasury Secretary Steven Mnuchin testifies at the Senate Small Business and Entrepreneurship Hearings to examine the implementation of CARES Act on Wednesday. Photo by Kevin Dietsch/UPI
Treasury Secretary Steven Mnuchin testifies at the Senate Small Business and Entrepreneurship Hearings to examine the implementation of CARES Act on Wednesday. Photo by Kevin Dietsch/UPI | License Photo

June 10 (UPI) -- Treasury Secretary Steven Mnuchin defended the effectiveness of the CARES Act during testimony Wednesday in front of the Senate Small Business and Entrepreneurship Committee.

Mnuchin and Small Business Administrator Jovita Carranza testified during the hearing.

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While committee chair Marco Rubio, R-Fla., called the CARES Act a success story, ranking member Ben Cardin, D-Md., said many mom-and-pop businesses were mostly shut out and will not have the ability to be up and running by the time the program expires at the end of June.

"The slowness of getting grant applications approved, the closing of the window in regard to nonagricultural applications, the arbitrary cap put on the program as well as the fact of the lack of transparency, we need to do better," Cardin said in his opening statement.

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Mnuchin, though, defended the law and its components like the Paycheck Protection Program, despite hiccups, saying it saved jobs and businesses.

"The [Paycheck Protection Program] has kept tens of millions of employees connected to their jobs," Mnuchin told the committee. "The National Federation of Independent Business found that 73 percent of its members surveyed rehired or retired workers due to the PPP. Economic impact payments and enhanced unemployment insurance are providing relief to millions of families and workers experiencing distress."

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Mnuchin said the Federal Reserve also helped maintain the flow of credit for industries.

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"We continue to monitor conditions closely as certain industries are rebounding more quickly than others," Mnuchin said. "For example, after losing nearly 1 million construction jobs in April, nearly half of those jobs have returned in May. By contrast, retail lost over 2 million in April and 16 percent of those positions returned in May."

Mnuchin complained about some state regulations, like making different seating restrictions between indoor and outdoor restaurants, allowing outdoor restaurants more freedom. Under questioning from Sen. Susan Collins, R-Maine, Mnuchin said he didn't understand the distinction between the two and called the differences "a bit random."

Rubio said he wanted Mnuchin to address the disparity between how African-American businesses and white businesses have been affected by the restrictions. Rubio said he saw one study where 95 percent of African-American small businesses had less than two weeks of cash available to run their companies, compared to 30 percent of white businesses.

"That's a big disparity," Rubio said.

Cardin also called for a new round of stimulus money for small businesses, calling for small and family-run businesses to be first in line if such money becomes available.

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