By Victor Reklaitis, MarketWatch
U.S. lawmakers said Tuesday that they’re working across party lines to set aside additional coronavirus aid for small businesses this week, after the new Paycheck Protection Program created in Washington’s third legislative response to the pandemic met with high demand.
Multiple lawmakers said the $350 billion loan program, established in a $2 trillion package that was signed into law on March 27, soon will require more money, and Treasury Secretary Steven Mnuchin said on Twitter that he was requesting an additional $250 billion for the Paycheck Protection Program, or PPP.
Republican Sen. Marco Rubio of Florida had tweeted earlier Tuesday that PPP “will need at least another $200-$250 billion.” Rubio also said Senate Majority Leader Mitch McConnell is working with Minority Leader Chuck Schumer to bring to the floor legislation containing additional funds for PPP, and there were hopes it would be passed by a voice vote on Thursday.
McConnell, for his part, said in a statement Tuesday that he would work with Schumer and the Trump administration to approve the funding this week, passing a measure in the Senate through unanimous consent or a voice vote. Congress is on recess and slated to get back to work on April 20, though lawmakers could return to Washington, D.C., sooner or later than planned.
House Minority Leader Kevin McCarthy, the California Republican, said in a statement that Mnuchin told him Tuesday morning that more money would be needed for PPP, and McCarthy backed the request. The Treasury secretary later tweeted that he asked for $250 billion and had spoken with McConnell, the Kentucky Republican and Schumer, the New York Democrat, as well as McCarthy and House Speaker Nancy Pelosi, the California Democrat.
“I support the Secretary’s request and following the Senate’s approval, the House should move swiftly to do the same and provide confidence to small businesses across the country that their government will be there for them,” McCarthy said in a statement.
Mnuchin said at a White House event that he expected the House to approve the funding on Friday after the Senate’s vote on Thursday. Speaking on Fox Business Network on Tuesday, Mnuchin noted that President Donald Trump previously has said if PPP ran out of money, “he’s going to go back to Congress.”
Also speaking at the White House event on Tuesday, Trump said more than 250,000 businesses have applied for the PPP loans, and the program has processed more than $70 billion in guaranteed loans.
The program for small businesses eventually could need as much as $1.8 trillion in funding, according to Howard Mason, Renaissance Macro Research’s head of financial research. Small businesses have suffered a record drop in optimism as the coronavirus crisis deepens, the National Federation of Independent Business said Tuesday.
U.S. stocks /zigman2/quotes/210598065/realtime DJIA +0.25% /zigman2/quotes/210599714/realtime SPX +0.17% have been plunging for weeks on coronavirus-related worries but have pared some of their losses thanks in part to hopes surrounding Washington’s aid programs.
In addition to boosting PPP this week, Democratic and Republican lawmakers and the Trump administration are working on a fourth legislative response to the coronavirus crisis. Analysts have predicted that the next big spending package could cost about $1 trillion but not become a reality for several weeks.