Treasury Secretary Steve Mnuchin has become a powerful figure in the administration as Trump frantically responds to the coronavirus crisis

Kayla Epstein

Mar 19, 2020, 03:28 IST

Treasury Secretary Steve Mnuchin has become a powerful figure in the administration as Trump frantically responds to the coronavirus crisis

Treasury Secretary Steven Mnuchin and U.S. President Donald Trump attend briefing about the coronavirus outbreak in the press briefing room at the White House on March 17, 2020 in Washington, DC.

Treasury Secretary Steven Mnuchin has taken on one of the most prominent roles in the Trump administration's coronavirus response.
Mnuchin has been negotiating with both House Democratic leadership an Senate Republicans to get a massive relief package through Congress aimed at blunting the economic impact of the coronavirus.
It's not unusual for a Treasury Secretary to take a major role in an administration's response to a financial crisis, veterans of the Obama administration say.
But "it is striking that the White House is not more involved alongside the Treasury Department," one Obama veteran said.
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Out of the small army of top officials that the Trump Administration has thrust into the spotlight to address the coronavirus crisis, one in particular has gotten top billing: Treasury Secretary Steven Mnuchin.

It was Mnuchin who exchanged ten phone calls with House Speaker Nancy Pelosi on Friday to hammer out the details of the Families First Coronavirus Response Act. It was Mnuchin who was cloistered with Senate Republicans this week as they come up with their own response to the Democrats' legislation. And it was Mnuchin who announced a series of economic interventions that the White House was seeking at a coronavirus press conference with President Donald Trump on Tuesday.

From negotiating directly with Congress to picking up the call for the government to send at least $1,000 to every American, the treasury secretary always seems to be in the room where it happens.

Mnuchin's prominent role mostly makes a lot of sense

"I think it's not too surprising that Treasury is playing a prominent role," said Karen Dynan, who served as Assistant Secretary for Economic Policy and Chief Economist the Treasury Department from 2014-2017.

"The Treasury Department views itself as the central steward of the U.S. economy and the U.S. financial system," Dynan told Insider. "In the past, when we've seen period where the economy is at great peril like it is right now, the Treasury Department has stepped in and played a central role shaping policy response."

However, Dynan said "it is striking that the White House is not more involved alongside the Treasury Department" in announcing its economic policy proposals to address the coronavirus.

Associated Press

Treasury Secretary Steven Mnuchin speaks during a press briefing with the coronavirus task force, at the White House, Tuesday, March 17, 2020, in Washington, as President Donald Trump looks on. (AP Photo/Evan Vucci)

On Wednesday, it was the Treasury Department that began circulating a memo outlining the White House's goals for a deal on coronavirus relief, the Washington Post reported, that included a $50 billion bailout for the airline industry and two rounds of $1,000 payments to Americans.

"I would have expected that the last administration would have released that kind of document through the White House, with the National Economic Council heavily involved in coordinating the effort," Dynan said.

But the Treasury's role in a crisis can vary depending on the administration in charge, Jason Furman, one of President Obama's top economic advisors and an economics professor at the Harvard Kennedy School, told Insider in an email.

During the 2008 financial crisis, Furman noted that "President Bush delegated to Secretary Paulson to do the negations on not just the financial aspects (like TARP) but also the fiscal stimulus aspects as well."

"During the Obama Administration we generally took a more team approach, and on fiscal issues the White House was generally in the lead," he added. "So there is no standard playbook. But what we are seeing now is in the range of what we've seen before and probably makes sense in the current situation."

Mnuchin has been the White House's key negotiator with Congress

It was Mnuchin, not Trump himself, who served as the main negotiator with Pelosi last week as the House hurried to put together the Families First Coronavirus Response Act, known on the Hill as the "Phase 2" legislation.

The pair spoke at least ten times by phone on Friday, according to Pelosi's deputy chief of staff Drew Hammill, who tweeted out every single call the two held.

On Tuesday, Pelosi and Mnuchin spoke again on the latest phase of legislation, according to another tweet by Hammill.

This week, Mnuchin has been holed up with Senate Republicans to get them onboard the so-called "Phase 3" legislation, along with Larry Kudlow, Trump's Director of the National Economic Council. He urged Republicans to pass the House bill in a Monday night closed door meeting, CNN reported, as some lawmakers expressed concerns. On Tuesday, Mnuchin tried to sell them on the administration's proposed $1 trillion economic stimulus plan during a closed-door luncheon. Mnuchin warned lawmakers that that unemployment could skyrocket to 20% because of the coronavirus if the government didn't intervene, Bloomberg and NBC News reported.

On Wednesday, Trump brushed off that warning, saying he didn't agree with Mnuchin's assessment and that it was an "absolute total worse case scenario."

Associated Press

Treasury Secretary Steve Mnuchin, second from left, speaks with members of the media as he departs a meeting with Senate Republicans on an economic lifeline for Americans affected by the coronavirus outbreak. on Capitol Hill in Washington, Monday, March 16, 2020. Standing with Mnuchin is White House chief economic adviser Larry Kudlow, right. (AP Photo/Patrick Semansky)

Senate Majority Leader Mitch McConnell (R) has pledged to work at "warp speed" to pass the legislation.

But the negotiation process has not been entirely smooth. Senate Democrats feel left out of the process, and Senate Minority Leader Chuck Schumer took to the floor on Wednesday to say that McConnell's tactics were "too cumbersome, too partisan, and will take far too long."

"Leader McConnell announced yesterday that his plan to develop the next phase of legislation would be first for Senate Republicans to sit among themselves and then sit down with the administration and come up with their own proposal before presenting it to Senate Democrats, let alone House Democrats," Schumer said.

"Secretary Mnuchin says he wants legislation passed by the end of the week. The McConnell process will not get us there," Schumer said.

Mnuchin picked up the call to send $1000 dollars to everybody

After Republican Sen. Mitt Romney of Utah first voiced support for an idea to send $1,000 to every American to help offset the financial distress caused by the coronavirus crisis, the proposal has earned bipartisan support in Congress. Furman endorsed the deal on Twitter. It shares striking similarities to ideas put forward by former Democratic presidential candidate Andrew Yang, who advocated for a "Freedom Dividend" of $1,000 for every American as his signature campaign initiative.

And it was Mnuchin who first said the Trump administration was behind the idea.

"Although the president likes the idea of the payroll tax holiday, I will tell you what we've heard from many people and the president has said we could consider this," Mnuchin said at a Tuesday White House briefing.

 "We're looking at sending checks to Americans immediately," Mnuchin said. "Americans need cash now and the president wants to get cash now, and I mean now, in the next two weeks."

How much? a reporter asked.

"I will be previewing that with the Republicans," Mnuchin replied.

On Wednesday, the Treasury Department memo outlining a list of the White House's priorities asked for two rounds of "economic impact payments" totaling $250 billion each, to be distributed as "direct payments to individual taxpayers."

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