U.S. Senator Kevin Cramer (R-ND), a member of the Senate Banking and Senate Environment and Public Works committees, led a letter to Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell urging them to keep the financial assistance authorized by the CARES Act industry neutral and free of bias.
“We urge you to ensure that the financial relief offered under the CARES Act is fully available to companies throughout the economy,” the senators wrote. “Some outside groups have already advocated certain sectors of the economy be excluded from the loans made available under the CARES Act. Acquiescing to these demands would be contrary to Congressional intent and would arbitrarily harm certain American workers. Both are unacceptable.”
The letter highlights the Federal Reserve’s partnership with the BlackRock Financial Markets Advisory unit (“BlackRock”), which will administer certain bond-purchasing aspects of the CARES Act. Earlier this year, BlackRock removed some companies’ public securities from its private investment portfolio.
The letter reiterates that Congressional intent is for BlackRock and all private companies who serve as fiduciaries to act without regard for their individual investment policies. The Senators stressed that all assistance must be broad and flexible. Due to economic stress caused by COVID—19, the credit ratings of many companies are abnormally strained, and the language of the CARES Act mandates financial aid should be administered based on need, not just traditional credit assessments.
“Congress intended wide-ranging relief to employers adversely affected by the COVID-19 crisis to be administered equitably,” the senators concluded. “Similar principles should apply when the Federal Reserve implements other liquidity provisions such as direct loans.”
Joining Senator Cramer’s letter were Senators Jim Inhofe (R-OK), Shelley Moore Capito (R-WV), John Barrasso (R-WY), Thom Tillis (R-NC), Steve Daines (R-MT), Ted Cruz (R-TX), Dan Sullivan (R-AK), John Hoeven (R-ND), John Cornyn (R-TX), Mike Enzi (R-WY), Joni Ernst (R-IA), James Lankford (R-OK), Bill Cassidy (R-LA), David Perdue (R-GA), Mike Braun (R-IN), and Mike Rounds (R-SD).