Mnuchin and McConnell Say Cash for Companies Is Not a Bailout – The Fiscal Times

Posted: March 24, 2020 at 6:09 am

Treasury Secretary Steven Mnuchin and Senate Majority Leader Mitch McConnell both emphasized Thursday that federal aid to big businesses such as airlines planned as part of the administrations proposed stimulus package of $1 trillion or more is not a bailout.

The administrations plan, still subject to negotiations with Congress, calls for $50 billion in loan guarantees for passenger and cargo air carriers as well as $150 billion for other severely distressed sectors of the U.S. economy, such as cruise operators and hotel companies.

The stimulus package would also provide $300 billion for loans, not grants, to small businesses affected by the pandemic.

Were not talking about so-called bailouts for firms that made reckless decisions, McConnell said. None of these firms not corner stores, not pizza parlors, not airlines brought this on themselves. Were not talking about a taxpayer-funded cushion for companies that made mistakes. Were talking about loans which must be repaid.

Mnuchin has struck a similar note. This isnt a bailout, he toldFox Businesson Thursday. We're not going to force things on people, but people who need liquidity, we're going to make sure that the taxpayers are compensated fairly.

The Washington Posts Robert Costa and Philip Rucker report that Mnuchin also sought to ensure that Senate Republicans were careful about the language they used when he met with them on Tuesday:

[T]he secretary pleaded with them not to use the politically charged word bailout in describing the proposed relief for Boeing, one of many large corporations that stands to benefit from the administrations plan. One senator raised a hand and asked if they should instead call them freedom payments, which prompted laughter, according to a person briefed on the closed-door meeting who spoke on the condition of anonymity to be candid about the discussion.

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Mnuchin and McConnell Say Cash for Companies Is Not a Bailout - The Fiscal Times

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