White House: Federal Government Can ‘Fill the Void’ if There’s a Credit Crunch

On Wednesday’s broadcast of CNBC’s “Squawk on the Street,” White House National Economic Council Deputy Director Bharat Ramamurti stated that if there is a credit crunch, the Small Business Administration (SBA) “may have some authorities to step in and fill the void.” And the administration believes they can “get what we need from” Congress “in terms of filling that gap.”

Ramamurti stated, “I think, thanks to the decisive action that the administration took, we really staved off the worst effects of a widespread bank run. I think we’ve seen deposit outflows largely stabilize, which was the main concern we had in the aftermath of the Silicon Valley Bank failure and I think we’ve started to see some progress on accountability for executives and also progress on changing some of the regulatory rollbacks that we saw in the previous administration. As you noted, I think the concern now is whether there’s going to be a pullback in credit availability. We’re monitoring that very carefully. We know that these regional banks in particular are a key source of credit for small businesses. And so, we’re monitoring that carefully. The data is still coming in. And I think we do have some options available to us if we see that there’s a big pullback in credit.”

He added, “I think the Small Business Administration — again, looking specifically at the effect on small businesses, the SBA may have some authorities to step in and fill the void. And, of course, we can make some proposals to Congress. I think one area where there is bipartisan agreement is on small businesses. And so, our hope is that, if there is a need, we can go to Congress and get what we need from them in terms of filling that gap.”

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