US risks 'permanent damage' from long shutdown: Mnuchin

People walk by a closed restaurant in Manhattan in New York City.

People walk by a closed restaurant in Manhattan in New York City.

AFP/Spencer Platt

WASHINGTON - The US economy risks suffering "permanent damage" the longer the lockdown to contain the COVID-19 pandemic drags on, US Treasury Secretary Steven Mnuchin said.

American families and businesses are suffering amid the nationwide shutdowns, Mnuchin told a Senate committee, but reopening the economy will need to be done with caution.

"We're conscious of the health issues and we want to do this in a safe way," he said of efforts to restart the economy.

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Mnuchin said the government is willing to take risks with the funds it has put up to help the economy withstand the unprecedented hit from the coronavirus pandemic.

He appeared remotely before the Senate Banking Committee in an unusual joint appearance with Federal Reserve Chair Jerome Powell to review how officials are using the over $2-trillion in support Congress approved in late March in the so-called CARES act.

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Government data show more than 30 million jobs have been destroyed, at least temporarily, by the lockdowns, and some legislators have complained that aid programs have been drained mostly by large corporations rather than the small businesses they were intended to help.

Democrats in the House of Representatives approved another $3-trillion aid program, but Republicans senators argued that it would be prudent to wait to give time for existing relief measures to make their way through the economy.

Source
AFP