Democrats come out against Sen. Toomey's Federal Reserve demand in new coronavirus relief bill

A group of Democratic lawmakers objected Friday to a Senate Republican effort to add into a bipartisan coronavirus relief that would prevent the next Treasury secretary from relaunching a series of emergency lending facilities that would essentially bail out financial markets. 

The effort is made by Sen Pat Toomey, a Pennsylvania Republican.

Current Treasury Secretary Steven Mnuchin launched the emergency lending measures at the onset of the global coronavirus pandemic. But ultimately much of the $454 billion in funding that Congress allocated to Treasury went unspent. Mnuchin said he will end the program the end of the year and request that the money be returned to Congress. 

"Maintaining the integrity of the role of the Fed, preventing the Fed from being politicized, from being misused, from becoming an allocator of credit and America’s biggest commercial bank, that’s the most important thing," Toomey said Thursday. He is in line to become the next chairman of the Senate Banking Committee.

House Democrats, however, want the incoming secretary under a President Biden to be able to reallocate those funds that Toomey is now trying to take back. Reps. Maxine Waters, the House Financial Services Committee chairwoman, and Richard chairman of the Ways and Means Committee, released the following statement about Toomey's provision:

"The GOP Senate’s dangerous demand to include Senator Toomey’s poison pill provision in the COVID-19 relief bill threatens to hamstring our nation’s response to the historic economic crisis of the coronavirus. If implemented, this unprecedented change to the law would block the Federal Reserve from ever creating lending facilities that help small businesses and state and local governments, taking away one of the important tools to fight this or any future economic crisis. Treasury Secretary Steven Mnuchin has previously expressed on-the-record support for continued use of these authorities."

"An agreement on a coronavirus relief bill was within sight, but Senate Republicans are now holding up the entire package over this unacceptable provision designed to sabotage the economic recovery under the Biden Administration. Senate Republicans’ extreme demand threatens to derail this urgently needed action, and it must be immediately abandoned so that we can move forward."

House Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell reportedly spoke Friday afternoon as the clock runs out for Congress to pass the legislation.

Also on the line this afternoon, the omnibus spending package that Congress has yet to pass in order to keep the government funded and fully operational.

The government will shut down at midnight without some sort of package passed. Congressional leaders have repeatedly delayed press conferences on Friday, and have told their caucuses to prepare to work through the weekend as the afternoon begins to shift to evening and a shutdown looms.