Mnuchin reportedly warns of 20% unemployment if $1 trillion stimulus package fails

Coronavirus fallout could be worse than 2008 financial crisis, Treasury secretary reportedly tells GOP senators
Mnuchin Photo
If the US unemployment rate did reach 20 percent, that would leave 35 million Americans jobless, according to CNN figures. (AP photo)

WASHINGTON, D.C. (WKBT) – As administration officials lobby for a stimulus package worth up to $1 trillion, Treasury Secretary Steven Mnuchin reportedly told a group of Republican senators Tuesday morning that unemployment could reach 20% if Congress doesn’t enact a proposed stimulus package ranging from $850 billion to $1 Trillion, according to media reports.

That dire possibility, first reported by Bloomberg News at 5:30 p.m. and echoed shortly thereafter by other news outlets, came as Mnuchin told the senators that he believes that the economic collateral damage from COVID-19 could dwarf the effects of the 2008 financial crisis. Bloomberg quoted anonymous sources it said were familiar with the exchange.

Ballooning unemployment is possible if Congress doesn’t rapidly pass the stimulus to relieve economic stress being inflicted upon wage workers and small- and medium-sized businesses, Bloomberg reported.

CNBC and CNN reports echoed the 20% figure, also quoting an unnamed source they said is familiar with Mnuchin’s huddle with GOP senators.

A 20% unemployment rate would be twice as high as the figure during the Great Recession and the highest since the Great Depression, according to CNN figures, which also indicated it would leave more than 32 million Americans out of a job.

CNN said it had reached out to the Treasury Department for a response, while Bloomberg quoted Treasury spokeswoman Monica Crowley as saying, “During the meeting with Senate Republicans today, Secretary Mnuchin used several mathematical examples for illustrative purposes, but he never implied this would be the case.”

One thing Mnuchin did say Tuesday during a White House press briefing where President Donald Trump and Vice President Mike Pence also spoke, “Americans need cash now. I mean now — in the next two weeks.”

Part of the stimulus the White House is floating includes giving every American adult $1,000 to help offset any financial woes they encounter amid job losses stemming from massive business and government shutdowns because of the coronavirus pandemic.

In the United States, coronavirus cases reached 6,441 by Tuesday evening, with a death tally of 109, according to the Worldometer website that is tracking the disease. Worldwide, the count is 198,214, with 7,965 deaths and 81,734 recoveries.