Trump’s tax cut architect could execute $ 500 billion coronavirus loan program
WASHINGTON (Reuters) – United States Assistant Secretary of the Treasury Justin Muzinich, architect of the sweeping Republican tax cut of 2017, is under consideration to oversee a new $ 500 billion bailout loan program against coronaviruses for large businesses, cities and states, two sources familiar with the agency’s plans said.
The move is part of a series of personnel changes within the Treasury Department to implement an unprecedented $ 2.2 trillion coronavirus bailout passed by Congress last week.
Muzinich, 42, a former mergers and acquisitions banker at Morgan Stanley, also served as chairman of Muzinich & Co, a family-owned investment firm, and was tax policy advisor for the 2016 presidential campaign to the former governor of Florida, Jeb Bush.
A Harvard and Yale Law School graduate, Muzinich joined the Treasury Department in 2017 as a senior advisor to Treasury Secretary Steven Mnuchin. He was instrumental in creating the Tax Cuts and Jobs Act which was passed by Congress and signed by President Donald Trump later in the year, including drafting some of the legislation and negotiating the terms. with Republican lawmakers. He was confirmed as the number two in the department in December 2018.
The restructuring of the tax code in 2017 reduced corporate taxes in the United States from 35% to 21%, a change that will bring the 2020 federal budget deficit to more than $ 1,000 billion despite a strong economy, a reported the non-partisan Congressional Budget Office in January, ahead of the coronavirus outbreak in the United States.
Muzinich is said to be in charge of a program that would mobilize $ 500 billion in capital from the newly allocated Treasury to support some $ 4.5 trillion in Federal Reserve loans to businesses, cities and states affected by the epidemic.
Designating key treasury officials to oversee such programs would be in addition to their normal functions. Muzinich has also overseen the department’s international sanctions and anti-money laundering efforts since a key undersecretary, Sigal Mandelker, left for the private sector last October.
Other measures being considered include the appointment of Brent McIntosh, under secretary of the treasury for international affairs, in charge of the bill’s aid programs to airlines, the sources said. McIntosh had served until last September as attorney general of the Treasury.
The department plans to put Michael Faulkender, its deputy secretary for economic policy, and Bimal Patel, the deputy secretary for financial institutions, in charge of a $ 350 billion program to provide loans repayable on salaries and expenses. general to small businesses hampered by the pandemic.
David Kautter, who is the assistant secretary of the treasury for tax policy, is said to be responsible for implementing a program of direct payments to individuals of up to $ 3,400 per household through the Internal Revenue Service.
“They’re moving resources around the building to try and get as many hands on the bridge as possible,” said Tony Fratto, a former Treasury official who was White House spokesman at the start of the 2008 financial crisis. But, he noted, “all of these people still have day jobs.”
Economists have said that swift implementation of loan disbursements and payments is essential to avert a deeper recession in the United States.
News of potential changes within the Treasury Department to implement the massive coronavirus bill was first reported by The Washington Post.
Reporting by David Lawder; Additional reporting by David Shepardson; Editing by Heather Timmons and Paul Simao