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Mr Toomey and his Republican allies argued that his original proposal merely codified what Congress intended in March when it enacted the original $ 2.2 trillion pandemic stimulus bill that provided funds to support the Fed’s emergency loan programs . But the scope of the language proposed by Mr Toomey went beyond that and caused alarms among Democrats, who said they were recruiting prominent figures to fight back.
Ben S. Bernanke, who led the Fed through the 2008 financial crisis, warned in a statement that it was “important that the Federal Reserve’s ability to respond promptly to harmful disruptions in the credit markets is not restricted.”
Regarding the March stimulus bill, Mr. Bernanke added, “The discharge bill should at least ensure that the Federal Reserve’s emergency lending agencies, as they existed before the CARES bill were passed, remain fully intact and available for future response to crises.”
Mr Schumer said Jerome H. Powell, the current Fed chairman, whom he described as “hardly a fiery liberal”, was “strongly opposed” to Mr Toomey’s proposal. The Fed refused to comment on whether Mr. Powell, a Republican first appointed central bank governor by former President Barack Obama, had spoken to Mr. Schumer about the matter in the past few days. Mr. Schumer’s office did not respond to a request for further details.
In a private call to House Democrats on Saturday, California spokeswoman Nancy Pelosi condemned the proposal, telling lawmakers that “you can write in there that this can never happen again,” according to one person on the call. who published the comments on condition of anonymity.
“That way you can tell Joe Biden, ‘We’ll tie your hands. No matter what comes out on the market, you can’t do it, ”Ms. Pelosi told Democrats.
Mr Toomey denied wanting to cripple the Biden administration, pointing out that he had spent months trying to make sure the Fed’s pandemic programs came to a halt. But the language he proposed to add to the stimulus plan was far broader.
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