Fed and Treasury urge Congress to approve more virus relief

WASHINGTON (AP) — Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin urged Congress to approve COVID-19 relief funds without further delay, though Democrats continued to attack a decision by Mnuchin to allow five Fed lending programs to expire during the pandemic.

In his most direct comments so far, Powell told the House Financial Services Committee on Wednesday that it's “very important” for Congress to provide economic support.

New funding would serve as a “bridge” for the economy to get from the current environment in which virus infections are spiking, to next year when vaccines should be widely available, Powell said.

“We are trying to get as many people across that bridge as we can,” Powell said.

Without more assistance, Powell said, people will lose their homes and small businesses will fail. “You could lose parts of the economy,” which would slow any recovery next year, he said.

“We are hearing from all over that small businesses are really under pressure," Powell told lawmakers.

For a second day a number of Democratic lawmakers on the committee challenged Mnuchin’s decision to allow five Fed lending programs to expire at the end of this year, contending that his reading of the law was incorrect. They say it's a political maneuver to hobble the incoming Biden administration financially.

“There is no justifiable reason for taking these tools away,” Rep. Maxine Waters, chair of the House panel, told Mnuchin. “It is foolish and reckless.”

In a rare split with Treasury last month, the Fed issued a statement saying that it believed it was important to continue providing an economic backstop after Mnuchin said he was terminating the programs.

Mnuchin has repeatedly insisted that he was just following the CARES...