What to Know in Washington: Congress Hits Weekend Without Deal

The Senate left Washington for the weekend after a fourth day of negotiations yielded little substantial progress on narrowing differences between Republicans and Democrats on a plan to bolster the coronavirus-ravaged U.S. economy.

Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) rejected a temporary extension of lapsed supplemental unemployment insurance proposed by President Donald Trump’s Treasury Secretary Steven Mnuchin and Chief of Staff Mark Meadows.

“On certain issues we made progress, on certain issues we’re still very far apart,” Mnuchin said after leaving a two-hour meeting in Pelosi’s office last night. He said they would continue talking today and Saturday “as long as it takes to get this done.”

Republicans including Trump are pressuring Democrats to go along with a stopgap extension of the expanded unemployment benefit and a moratorium on evictions while talks continue on a more comprehensive virus relief bill. Those two measures were part of the March stimulus package and are now expired, leaving millions of Americans without that safety net.

Pelosi said a one-week extension to avoid a lapse in benefits would be “worthless” without the prospect of a comprehensive deal.

“We just don’t think they really understand the gravity of the problem,” Schumer said.

The Senate is scheduled to begin its August break at the end of next week. House Majority Leader Steny Hoyer (D-Md.) said the chamber won’t be in session next week but members will be subject to recall on 24 hours notice if a deal is reached and ready for a vote. The House is in session today to vote on a package of fiscal 2021 appropriations measures.

Senate Majority Leader Mitch McConnell (R-Ky.) yesterday moved forward with a plan to set up votes next week on Republican proposals to extend the lapsed supplemental unemployment insurance.

The GOP gambit is almost certain to fail because McConnell would need Democratic votes to pass any legislation. But it will give Senate Republicans a chance to go on the record as saying they tried to act. Read more from Daniel Flatley, Laura Litvan and Steven T. Dennis.

Photographer: Al Drago/Bloomberg

McConnell at the Capitol on Thursday.

Businesses Can’t Reach Consensus on Jobless Aid: The business lobby and management attorneys are divided over the best way to narrow the federal boost to unemployment insurance, just like Senate Republicans. Generally, employers looking to scale-up operations want Congress to replace the $600 weekly benefits supplement that officially expires after today with a less-generous amount to ensure people aren’t disincentivized from seeking work because they earn more on unemployment. But precisely how to accomplish that is where the management position breaks down into a complex, employer-specific debate about which of the proposals lawmakers are discussing is most workable. Ben Penn has more.

Business Tax Breaks Could Move Fast: Lawmakers in both parties have signaled that they could quickly move on more pandemic relief for businesses once a compromise is found on more contentious issues. There appears to be some bipartisan backing for relief measures including an expansion of targeted payroll tax relief for businesses established in the CARES Act. “Changes that provide greater certainty for small businesses, in particular, in determining whether they are eligible could be helpful,” Sen. Ron Wyden (D-Ore.), the top Democrat on the Senate Finance Committee, said in an emailed statement to Bloomberg Tax, commenting on the employee retention tax credit. Read more from Colin Wilhelm.

The Coronavirus Pandemic

U.S. Officials to Defend Virus Response: Trump administration officials are set to defend the federal government’s response to the coronavirus crisis at a Friday hearing hosted by a House panel calling for a national plan to contain the virus. Top leaders from the National Institutes of Health, the Centers for Disease Control and Prevention and the Department of Health and Human Services plan to highlight public-health interventions, vaccine and therapeutic development work and the build-out of testing infrastructure, according to prepared testimony.

Officials including Robert Redfield, director of the CDC, and Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, will inventory measures taken to improve testing and develop therapeutics and vaccines, according to the testimony. But the prepared remarks don’t discuss what many health experts say is needed and the hearing is on: A national strategy to contain the coronavirus to replace the current state-by-state piecemeal effort.

Covid-19 “is the most significant public health challenge to face our nation in more than a century,” the officials said in a joint statement that was released by the committee. Read more from Emma Court and Robert Langreth.

• Earlier: Trump Is Pressed to Set National Strategy as Covid Deaths Mount

Over 150 Firms That Took Loans Plan Layoffs: More than 150 U.S. businesses that received financing from the Paycheck Protection Program have announced they intend to lay off some employees, undercutting efforts to preserve jobs at pandemic-hit companies, S&P Global Market Intelligence says. The firms, which include arts organizations, real estate firms, and manufacturers, are estimated to have received between $292 million to $648 million in total loans, S&P said in a report. And yet they had plans to cut 15,814 employees from May 1 to July 17.

House Bill Requires Masks on Flights: Leading Democrats in Congress, frustrated with what they say are inadequate protections against Covid-19 in air travel, introduced legislation to require the federal government to mandate face masks on flights and in airports. The measure would authorize criminal penalties for passengers who disobey a flight crew’s instructions to wear a mask on a plane and sets civil fines for people who don’t wear masks in an airport.

The bill, unveiled yesterday, would also force the government to create a national aviation preparedness plan for epidemics — which is required under an international treaty but was never done in the U.S. — and to ramp up government-sponsored study of how infectious diseases are transmitted on airliners.

Bill co-sponsors include House Transportation and Infrastructure Chairman Peter DeFazio (D-Ore.), Rep. Rick Larsen (D-Wash.), who leads the aviation subcommittee, and House Select Intelligence Chairman Adam Schiff (D-Calif.). Read more from Alan Levin.

Gilead Plans to Make 2 Million Remdesivir Doses This Year: Gilead yesterday said it expects to make more than 2 million doses of Covid-19 treatment remdesivir by year-end. In its second-quarter earnings report, Gilead raised its outlook for the year, pointing in part to the early success of remdesivir. Read more from Kristen V. Brown.

NYC Steels Itself for Fall Virus Return: New York City has kept its Covid-19 infection rates low, but the risk of a resurgence looms over the Big Apple as fall approaches. Yesterday Gov. Andrew Cuomo (D) said New York is making $30 million available to counties to increase contact tracing as well as testing for the coming flu season, which generally hits in the fall and winter. Read more from Olivia Raimonde.

Visa Rules Trap Migrant Workers in Virus-Infested Dorms: As coronavirus cases explode at U.S. farms and food factories, the foreign migrants who pick fruit, clean seafood and sort vegetables are getting trapped in tightly packed bunkhouses where illness spreads like wildfire. Often, they can’t leave — unless they’re willing to risk deportation.

In Oxnard, a small city just outside Los Angeles, a Covid-19 outbreak raced through a dormitory where farmworkers slept seven to a room. By early July, 198 out of its 215 residents tested positive. About 100 miles north, in Santa Maria, Calif., at least 85 people were infected at group housing facilities within a few weeks. And in Coldwater, Mich., close to 70 guest workers caught the virus at a barracks on a produce farm. Mike Dorning has more.

Elections & Politics

Trump Escalates His Election Doubts: Trump is quick to call “fake news” any suggestion he won’t win a second term, yet his recent campaign shakeup and increased attacks on mail-in voting signal the political peril he faces from a raging pandemic and cratering economy.

One of the most extreme signs came yesterday, when Trump floated the idea of postponing the election with 96 days before the vote. The president can’t do that without an act of Congress, but it marked a dramatic escalation in his repeated, unfounded arguments that allowing mail-in ballots to protect against coronavirus would lead to widespread voter fraud and render the election illegitimate. Trump later said that he doesn’t want to change the date of the election, but warned it could be days “or even years” until the nation knew the outcome if mail-in balloting is used. “I don’t want to see a crooked election,” Trump told reporters at the White House. “This election will be the most rigged election in history, if that happens.”

The news added to the pile of crises besetting Trump’s White House — ranging from the coronavirus and the economy to unrest over police brutality and racial inequality — that have helped propel Democratic nominee Joe Biden into the lead. Trump trails Biden by more than 8 percentage points in the RealClearPolitics polling average, and is behind in key battleground states Arizona, Florida, Michigan, North Carolina, Pennsylvania and Wisconsin. Read more from Jordan Fabian.

• More than a quarter of Republicans, 26%, disapprove of Trump’s handling of the coronavirus, according to an ABC/Ipsos poll, Nour Al Ali reports. Similar numbers of Republicans disagree with Trump’s handling of recent protests (22%) and Russia (20%). Just over 9 in 10 Democrats disapprove of Trump’s action on all three matters; with approval of the president on the pandemic at 7%, the unrest at 8% and Russia at 8%.

Changing the Election Date Difficult Even for Congress: Trump has no power to change the date of the Nov. 3 election by executive order, but Congress could change the date if it wanted to. Still, it would be difficult to push elections back much further without hitting legal and constitutional deadlines. States need time to complete their official counts and certify the results before appointing members of the Electoral College, called electors. And there’s one deadline that can’t be moved without a constitutional amendment. Inauguration Day is Jan. 20, 2021.

If a catastrophe were to somehow prevent the election of new members of Congress, the president pro-tem of the Senate would move to the White House. That’s currently Sen. Chuck Grassley (R-Iowa). But of the 33 senators whose terms expire this year, 21 are Republicans. So without an election, Democrats would control the chamber and likely elect their senior member, Patrick Leahy (Vt.), as president-pro-tem. Read more from Gregory Korte.

Obama Calls for Voting Reform in Eulogy for Lewis: Former President Barack Obama, speaking at the funeral service in Atlanta for Rep. John Lewis (D-Ga.) yesterday, urged Congress to honor the civil-rights icon by making sure every American is able to vote. “Like John, we have got to fight even harder for the most powerful tool we have, which is the right to vote,” Obama said in the eulogy at the historic Ebenezer Baptist Church, once led by Martin Luther King Jr. Read more from Stacie Sherman.

Cyber Agency, States Test Election Plans: While Election Day 2020 may look different from years’ past because of expected high mail voting due to the pandemic, voters should know that state, local and federal election officials are testing their systems and preparing for the election now, the Homeland Security Department agency charged with election security said in a press release yesterday, Shaun Courtney reports.

“We recognize that change can lead to confusion, and adversaries may seek to exploit that confusion to spread doubt in the process or disinformation. These efforts can only be successful if we let them, which is why it’s important to be patient and remember that your state and local officials are the best sources for trusted and accurate information about voting, Election Day procedures, and official results,” Cybersecurity and Infrastructure Security head Christopher Krebs said in a joint statement with other election community leaders.

The statement came after election communities this week held their largest annual exercise to test and refine response plans. It also came the same day as the widely-panned suggestion from Trump that the November election be delayed.

• Separately, a reduction in coronavirus transmission risk at polling places could be achieved by fully implementing the Centers for Disease Control and Prevention’s interim guidance, which includes longer voting periods and increasing polling locations, according to a report yesterday recapping Wisconsin’s April 7 primary. Read more from Victoria Hodge.

What Else to Know

Secrecy Breach Sheds Light on Court Dynamics: The U.S. Supreme Court this week witnessed an extraordinary breach of its rules of confidentiality, as a series of CNN stories exposed some of the justices’ internal deliberations during their just-completed term. The series, written by veteran Supreme Court reporter Joan Biskupic and based on unidentified sources, shed light on the maneuvering among the justices in major cases over abortion, subpoenas for Trump’s financial records and job discrimination against LGBT workers.

The revelations are likely to send a chill through a court that is normally among the most leak-proof institutions in Washington. Biskupic’s stories included information known to only a handful of people — the nine justices, their law clerks and office assistants and perhaps the justices’ spouses and closest outside confidants. “The level of detail is truly astonishing,” said Melissa Murray, a New York University law professor and co-host of the “Strict Scrutiny” podcast about the court. “The fact that the court is like a sieve or a colander is really surprising. It’s just not done.” Read more from Greg Stohr.

Judges Not Barred from Federalist Society, ACS Membership: Federal judges won’t be barred from membership in the conservative Federalist Society or the liberal American Constitution Society after the judiciary’s policy making arm decided to table a draft advisory opinion that would’ve had that effect. The Judicial Conference abandoned the proposal after a comment period that yielded 300 responses from judges and will instead rely on existing guidance to govern membership in outside organizations, Director of the Administrative Office of the U.S. Courts James C. Duff said in a memo yesterday. Read more from Madison Alder.

Big Tech Stocks Add Billions After Hearing: A day after their leaders faced five hours of interrogation in Congress over allegations their power and influence is out of control, four of the biggest American tech companies saw their combined market value swell by $250 billion thanks to earnings that surprised even Wall Street. Shares of Amazon, Facebook, Apple and Alphabet built on already-torrid rallies after each reported earnings or revenue that crushed analyst estimates. “It’s good that these tech giants did their hearings yesterday and not tomorrow given all these results,” analyst Dan Ives said on Bloomberg TV. Read more from Sara Ponczek and Lu Wang.

Afghanistan Attacks: Attacks against Afghanistan’s security forces and civilian casualties remained high in the last quarter despite a U.S.-forged peace agreement with the Taliban meant to bring an end to America’s longest war. Violence in Afghanistan remained above average for most of the three months ending June 30, the U.S. Special Inspector General for Afghanistan Reconstruction, or Sigar, said in a report published late yesterday. Read more from Glen Carey.

U.S. Seeks to Seize John Bolton Book Profits: The U.S. government asked a federal judge in Washington to rule in its favor without a trial as it seeks to seize the proceeds from former National Security Adviser John Bolton’s tell-all memoir. Read more from David Yaffe-Bellany.

Cohen Can Talk to Press Under New U.S. Deal: Trump’s former lawyer Michael Cohen will be able to talk to the press while serving out his remaining prison sentence in home confinement, after the U.S. government backed down on the restriction. Read more from Erik Larson.

With assistance from Brandon Lee

To contact the reporter on this story: Zachary Sherwood in Washington at zsherwood@bgov.com

To contact the editors responsible for this story: Giuseppe Macri at gmacri@bgov.com; Loren Duggan at lduggan@bgov.com; Michaela Ross at mross@bgov.com