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Live Updates: Mnuchin and Powell Testify


Credit…Al Drago for The New York Times

Treasury Secretary Steven Mnuchin was quizzed for a second day by lawmakers about his decision to end some Federal Reserve emergency lending programs, with Mr. Mnuchin continuing to insist he was following congressional intent and that the effort was not political.

Mr. Mnuchin decided in November to end five of the Fed’s emergency loan programs that had been backed by congressional funding — including ones that have been helping state and local governments and businesses to access credit. Mr. Mnuchin also asked the Fed to return the money supporting the programs, which could limit his successor’s ability to simply restart the programs at such a large scale.

At a hearing of the House Financial Services committee on Wednesday, in a second day of testimony on Capitol Hill, Mr. Mnuchin revealed that he has spoken to Janet L. Yellen, his expected successor as Treasury secretary, as part of the transition process and that they discussed his decision to end the facilities.

“I advised her that my reading and interpretation of this was nonpolitical,” Mr. Mnuchin said, adding that he had a good working relationship with Ms. Yellen, who was Fed chair at the beginning of the Trump administration.

In a series of testy exchanges, Democrats blasted Mr. Mnuchin’s decision as a misreading of the law and a direct attempt to prevent the incoming Biden administration from improving the Fed’s lending programs.

At one point, Representative Katie Porter, a California Democrat, asked Mr. Mnuchin if he was a lawyer and accused him of “playacting” one. The Treasury secretary said that he is advised by plenty of lawyers and shot back, asking Ms. Porter if she was a lawyer.

Republicans, by contrast, backed up his contention that the facilities were always meant to end. Fed Chair Jerome H. Powell refused to weigh in on Mr. Mnuchin’s legal reading at Wednesday’s hearing, saying that it was the Treasury secretary’s call to make, but made it clear that the central bank would have preferred for the programs to remain available as a backstop.

“We see them as serving a backstop function,” Mr. Powell said. “We would want to leave that backstopping function in place for some additional period of time — not forever.”

Mr. Mnuchin has been urging Congress to use the money to fund small business relief or other measures that might support the economy. But that could add to the deficit in a way that the original funding did not. The $454 billion that Congress appropriated in March was assumed to have little to no budget impact by the Congressional Budget Office since the money was supporting loans that would be repaid. Repurposing the money could add to the deficit, depending on what it is going to be used for, which could make Republicans wary.

Both he and Mr. Powell suggested that the economy is going to need more support from Congress in the months ahead, though lawmakers have been unable to reach agreement on the size and scope of another package.

Mr. Mnuchin said that his top priorities would be for Congress to give him permission to reactivate $140 billion of unused Paycheck Protection Program money to help small businesses. He also expressed support for extending emergency unemployment insurance that will expire at the end of the year and he said that he backed giving an additional $20 billion of payroll support money to the airline industry.

Mr. Powell suggested that state and local governments, small business relief, and unemployment insurance might be three important places for Congress to look to provide relief.

“We ought to remember that despite the rapid progress in getting people back to work, which is so welcome, there’s still 10 million people out of work,” Mr. Powell said. “There’s a lot of work left to do there.”

Senator Mitch McConnell began sharing a framework for another targeted coronavirus relief package with members of the Republican conference on Tuesday.
Credit…Pool photo by Tom Williams

Steven Mnuchin, the Treasury secretary, on Wednesday said President Trump would sign a coronavirus relief bill based on a framework that is circulating among Republicans.

Although the language for a bill has not been drafted yet, Senator Mitch McConnell of Kentucky, the majority leader, began sharing the outlines of another targeted aid package with members of the Republican conference on Tuesday, after discussions with Representative Kevin McCarthy of California, the minority leader, and White House officials.

The draft framework, which would in part repurpose unspent funds from the $2.2 trillion stimulus law enacted in March, does not include funds for state and local governments or transit agencies, and includes a liability shield that Democrats have long resisted. It also includes about $300 billion for small businesses, restaurants and theaters, as well as billions of dollars of funding for vaccines, schools and the United States Postal Service.

“The president will sign the McConnell proposal that he put forward yesterday — we look forward to making progress on that,” Mr. Mnuchin told reporters on Capitol Hill. But he declined to comment on a new proposal that top Democrats quietly offered to Republicans Monday evening, or offer additional thoughts on a $908 billion bipartisan framework that a group of senators are currently working on.

Speaker Nancy Pelosi of California and Senator Chuck Schumer of New York, the minority leader, have not yet given details about the new proposal they offered to Republicans. But a growing number of rank and file members are advocating for another bill before the start of the new Congress in January, arguing that more steps could be taken to provide relief under a new administration.

It is likely that any form of coronavirus relief — either substantial new funding or narrow extensions of provisions set to expire at the end of the month — will be tied to legislation that both chambers need to approve in the coming days to avoid a government shutdown on Dec. 11. With coronavirus cases spiking across the country, lawmakers are eager to limit the amount of time spent in Washington.

“All these actions are positive in terms of working toward a compromise that can be supported by the House, the Senate and the president of the United States,” Representative Steny H. Hoyer of Maryland, the majority leader, said of the various proposals. He said he remained “hopeful that in the next few days that we will be able to come to an agreement on a bill that responds to these major crises at least in the short term.”

Just weeks after agreeing to be acquired by Mars, the snack maker Kind will announce Wednesday a deal to buy a like-minded food company, Nature’s Bakery.

Kind’s strategy is to turn itself into a “health and wellness platform,” amassing a range of products it makes or acquires, the Kind founder and executive chairman Daniel Lubetzky told DealBook. That plan was in place when Mars was only a minority investor, and “our partners at Mars want us to continue,” he said.

Nature’s Bakery was founded in 2011 by the father-and-son team of Dave and Sam Marson. The company, which sold a minority stake to private equity firm VMG Partners in 2016, now offers “plant-based, nut-free and dairy-free” products in retailers like Costco and Target. Nature’s Bakery will keep its supply chain separate from Kind’s, to ensure its products stay nut-free.

Kind is paying about $400 million to acquire Nature’s Bakery, according to two people familiar with the deal who weren’t authorized to disclose its terms publicly.

The Nature’s Bakery deal and Kind’s takeover before it are the latest in a string of acquisitions by big food brands of smaller, upstart rivals with cultures that are hard to replicate at large corporations. These large acquirers have sought to avoid past stumbles in similar deals, when they swallowed brands whole or confused consumers by pumping out new iterations of niche products too quickly. That has meant creating stand-alone units to manage younger, hipper brands: Hershey, for example, runs several through Amplify Snack Brands, the parent of SkinnyPop, which it acquired in 2018.

Kind, which will operate independently within Mars, plans a hands-off management approach with Nature’s Bakery, while still offering the benefits of the global distribution might of the maker of M&M’s and Snickers. “We want to create a culture where we really empower our partners for them to decide what’s best for their brands,” Mr. Lubetzky said.

The dining room at Swift & Sons is empty. The Chicago restaurant is part of a group co-founded by Kevin Boehm, who said that without help, “we can’t make it to April or May.”
Credit…Lucy Hewett for The New York Times

The challenge facing the United States now is to keep the economy going long enough to prevent irreparable damage to the ecosystem on which a huge share of its activity is built, Neil Irwin reports.

“There are these little land mines across the economic landscape,” said Joe Brusuelas, chief economist at RSM, an accounting firm for midsize businesses. “Even if they don’t matter at the macro level, at the local level they can matter a lot.”

Those land mines could hold the national economy back even after a vaccine is widely available.

  • The Independent Restaurant Coalition argues that widespread restaurant failures are inevitable without a major new federal rescue. That could simultaneously mean vacant former restaurant spaces, unemployed restaurant workers, and restaurant entrepreneurs bankrupted and in no position to start over.

  • A wave of commercial foreclosures could create closings and other disruptions as new owners seize control of shopping malls, hotels and other properties. The delinquency rate for mortgage securities backed by retail real estate was 14.3 percent in October, up from 4.6 percent a year earlier. The rate for lodging properties was 19.4 percent, up from 1.5 percent. And those delinquencies reflect missed loan payments before the latest surge in virus cases and renewed lockdowns.

  • State and municipal governments will be forced to reckon with a drop in tax revenue. Projections vary widely by state, but most states expect revenue to fall in the fiscal year ending in 2021, with several projecting 10 percent to 20 percent declines, according to data compiled by the Urban Institute. Without help from the federal government, states and localities would probably need to cut deeper, adding to the 1.3 million job losses since February.

As President-elect Joseph R. Biden Jr.’s introduced his nominees for economic positions on Tuesday, they made it clear that they were thinking expansively about how to revive the U.S. economy and looking beyond just restoring lost jobs and livelihoods to finding ways to widen economic wealth, broaden opportunities and repair safety net programs.

Here is more on Mr. Biden’s picks to head the Council of Economic Advisers and for the No. 2 position at the Treasury Department, which will be lead by Janet Yellen.

Credit…Kriston Jae Bethel for The New York Times

Friends and former colleagues say they expect Ms. Rouse to bring a focus on the forces that hold people back in the economy and a degree of diligence to the Council of Economic Advisers if she is confirmed by the Senate to lead it, report Jim Tankersley and Jeanna Smialek.

Austan Goolsbee, who led the council under Mr. Obama when Ms. Rouse was a member, said he expected Ms. Rouse to focus on challenges facing workers in the so-called gig economy — like drivers for ride-sharing services like Uber and Lyft — and on workers who suffer long spells of unemployment in the crisis.

In recent months, Ms. Rouse has advocated new federal protections for workers in response to the pandemic. In April she called for a law “that mandates (and perhaps subsidizes) paid sick leave, which has been shown to reduce turnover, increase productivity and lower overall health care costs for employers.”

Credit…Kriston Jae Bethel for The New York Times

Mr. Adeyemo, who goes by Wally, brings a mainstream policy perspective with a background that breaks barriers, Alan Rappeport reports. Mr. Adeyemo would be part of a history-making duo at Treasury: He would be the first Black deputy at the Treasury, serving with the first female secretary, Janet L. Yellen.

The soft-spoken and deliberate Mr. Adeyemo’s approach will provide a stark contrast to the Trump administration’s combative tone in economic diplomacy. At the 2016 event sponsored by the Center for Strategic and International Studies, Mr. Adeyemo described the importance of encouraging China to liberalize its markets by making the case that doing so was in its own economic interests — and in the interests of the United States.

That multilateral approach to dealing with China could be a complication for Mr. Adeyemo at his confirmation hearing, as Republicans have become accustomed to Mr. Trump’s confrontational stance. And Mr. Adeyemo’s work for BlackRock, the world’s largest asset manager, will probably raise questions from some Democrats, as progressives have already expressed their displeasure.

By: Ella Koeze·Source: Refinitiv

  • After closing on a record high, the S&P 500 dipped on Wednesday as enthusiasm about vaccines and next year’s potential economic recovery subsided. European stocks were mixed.

  • The Stoxx Europe 600 index fell 0.4 percent, pulled lower by some retail and financial stocks, while Britain’s FTSE 100 rose 0.7 percent.

  • Shares of the drug maker Pfizer rose after Britain gave emergency authorization to the vaccine it developed with BioNTech. The government said that 800,000 doses of the drug, which must be stored at very low temperatures, would be available by next week for health workers to begin administering.

  • “Approval of a highly effective vaccine may mark the beginning of the end to the Covid-19 economic turmoil and the beginning of a new bull market for equities,” Mike Bell, a strategist at JPMorgan Asset Management, wrote in a note. “As this year’s savings are spent next year, the global economy should boom driving corporate profits and equities higher in 2021.”

  • Analysts at Barclays also said they favored equities over bonds, a safer asset class that tends to have lower returns, on expectations that the rollout of vaccines will help the global economy overcome the impact of a winter surge in virus cases. They forecast the S&P 500 index would rise to 4,000 in 2021. It reached a record high of 3,662.45 on Tuesday.

  • But vaccines developed by Pfizer and other companies are still awaiting regulatory approval in many countries, including the United States and the European Union, and even then will take months to be distributed. President-elect Joseph R. Biden Jr. and his new economic team called on Congress to pass a relief package to address “urgent needs.”

  • The British pound fell against other major currencies as the European Union’s Brexit negotiator reportedly said there were still a handful of issues to overcome in the trade talks. The two sides are trying to come to an agreement in time to implement a deal before the end of the Brexit transition period on Dec. 31.

Planning boards for issues of Better Homes & Gardens, one of Meredith’s titles, at the company headquarters in Des Moines.
Credit…Daniel Acker for The New York Times

Meredith Corporation on Wednesday named Catherine Levene the president of its national media group, which publishes magazines that include People, Better Homes & Gardens and InStyle.

Ms. Levene, 50, who joined the company last year, will be its first female corporate officer. Her new post puts her in charge of the company’s digital outlets, magazines and consumer products businesses. She succeeds Jon Werther, who left the company last year.

Based in Des Moines, Meredith is the largest magazine publisher in the country, with 36 million subscribers, as well as a formidable digital media company. It specializes in home and lifestyle publications — Parents, Shape, Health and Traditional Home are in its stable — and grew to its current size after acquiring Time Inc. for $2.8 billion in 2017. Meredith sold off the Time Inc. titles that did not match up with its usual fare (Sports Illustrated, Time and Fortune) and kept the rest.

With her promotion, Ms. Levene is taking a job that was held for six years by Tom Harty, the company’s chief executive officer and chairman. She said a top priority, for the time being, was keeping employees safe during the coronavirus pandemic.

“The vast majority of our people work from home and will continue to until guidelines suggest that it’s safe to return to the office,” Ms. Levene said. “While productivity is as strong as ever, the Meredith culture is a vigorous and collaborative one and we want to make sure our new employees get the full sense of it.”

Ms. Levene previously worked at The New York Times and Daily Candy, and was the co-founder and chief executive of Artspace, a contemporary art website.

Craig Erwich, the longtime head of original programming at Hulu, will now also oversee ABC Entertainment.
Credit…Amy Sussman/Getty Images

Disney is the latest old-school Hollywood company to make big changes in its executive wing as the entertainment industry shifts its focus from network television and theatrical movies to streaming media.

On Tuesday, the company — home to the streaming platforms Disney+ and Hulu, as well as the ABC network and the 20th Television production studio — announced a shake-up that consolidates its TV operations.

Karey Burke, the head of ABC Entertainment, will leave the network and take over as the president of 20th Television, Disney said. Craig Erwich, the president of Hulu Originals, will keep that job and also take over as president of ABC Entertainment.

Bert Salke, the head of the company’s Touchstone Television studio, is leaving the company, having taken a producing deal. The Touchstone studio will discontinue and be folded into 20th Television.

Dana Walden, the chairman of entertainment at Walt Disney Television, said the changes would help the company deliver new programming to Disney+ and Hulu, as well as rival streaming services and networks.

“I am proud of our exceptional leadership team and all we have accomplished, but the media landscape is changing and this reorganization better positions us for the future,” Ms. Walden said in a statement.

The changes suggest the diminishing importance of what used to be one of the biggest jobs in the entertainment industry: the network head. In the streaming era, that post does not seem quite big enough for a single executive.

In a similar move in October, NBCUniversal gave Susan Rovner creative control over NBCUniversal’s television properties, including the NBC television network, the Peacock streaming service and several cable channels. (Frances Berwick is in charge of business operations at many of NBCUniversal’s television properties.)

Mr. Erwich, who has been at Hulu since 2014, has championed series like “The Handmaid’s Tale” and “Pen15.” Along with continuing to find original shows for Hulu, he will oversee entertainment at ABC. Ms. Burke, who had been the head of ABC for two years, will run a major television studio as the new head of 20th Television.

Residents of a nursing home playing bingo outside in Georgia this summer. 
Credit…John Bazemore/Associated Press

The major pharmacy chain CVS has reached a deal with the federal government to give out a Covid-19 antibody treatment in patients’ homes and long-term care facilities, the company announced on Wednesday, providing a new way for certain high-risk patients to get a drug that aims to keep them out of the hospital.

The intravenous treatment, called bamlanivimab and developed by Eli Lilly, has been administered mainly at hospitals since it received emergency authorization from the Food and Drug Administration less than a month ago. Since then, the federal government has distributed to state health departments nearly 170,000 doses of the treatment — over half its supply for the rest of this year.

The deal with CVS involves just 1,000 doses of the treatment, enough to treat 1,000 Covid-19 patients over a three-month pilot period. The program will be limited for now to seven metropolitan areas — Boston, Chicago, Cleveland, Los Angeles, Milwaukee, Minneapolis and Tampa. It is not clear how much impact that will have as the virus is spreading rapidly and demand for treatments is surging.

“Even with this partnership, we’re talking about a very limited resource,” said Dr. Robert Goldstein, an infectious disease physician at Massachusetts General Hospital. “We still don’t have a way to deliver it equitably, and I’m not sure that the CVS partnership is necessarily going to improve equity in distribution.”

Still, giving the treatment in residential settings could help avoid the logistical challenges involved in infusing it at hospitals.

“We believe that this is a much more patient-friendly way to treat, in the comfort of someone’s own home or without having to be transferred,” said Dr. Sree Chaguturu, the CVS executive who is helping to lead the planning for the pilot.

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