What to Know in Washington: Melania Talks Virus, Pence to Speak

First lady Melania Trump capped the second night of the Republican convention by attempting to soften the image of her highly divisive husband, forgoing attacks on Democrat Joe Biden to focus on the ravaging toll of coronavirus and the nation’s tortured racial history in a way Donald Trump usually avoids.

She acknowledged the deaths of more than 178,000 Americans and called for national unity in response—a departure from the president’s customary handling of a virus he first downplayed and now seeks to put behind him. In between, Melania Trump called on the nation to see the president as she does, as a leader devoted to the safety of the country and deserving of a second term.

“America is in his heart,” she said in an address delivered in the newly redesigned Rose Garden at the White House. “So while at times we only see the worst of people and politics on the evening news, let’s remember how we come together in the most difficult times.”

The speech was a marked shift from the incendiary partisan tone and revisionist praise of Trump’s first term served up by the almost five hours of events that came before it. Just minutes before the first lady spoke, Donald Trump’s son Eric unleashed a barrage of attacks on Democrats, saying radicals want to “erase history,” and “burn the Stars and Stripes that represent patriotism and the American dream.” Read more from Josh Wingrove.

Pence’s Loyalist Role May Mean Boom or Bust in 2024: Trump’s presidency has been marked by theatrics, turmoil and dazzling made-for-TV spectacles. And then there’s Mike Pence.

The subdued and austere vice president—both Trump’s most loyal lieutenant and, in some ways, his antithesis—gets his moment in the spotlight today when he delivers the keynote speech of the Republican National Convention’s third night. It’s a pivotal moment for Pence, 61, ahead of his own potential 2024 bid for the White House.

No one has so completely tied his own personal political fortunes to Trump as Pence. Vice presidents are expected to stay in line and keep any disagreements with their bosses private, but those with presidential ambitions will occasionally make token demonstrations of independence.

Not Pence, whose unswerving loyalty, his critics say, extends to the point of obsequiousness. If Trump wins re-election, Pence may be rewarded with his own shot at the presidency.

But just like his boss, Pence’s future has been thrown into doubt by the coronavirus outbreak. The vice president had two high-profile jobs this year: lead the White House’s coronavirus task force and help deliver the Midwest for Trump’s re-election. Neither file has gone very well, with more than 178,000 Americans dead from the virus and Trump trailing Biden in polls of Michigan, Wisconsin and Pennsylvania, the states that determined the presidency in 2016.

In Republican circles, Pence has developed a reputation for unfailing loyalty, discretion and solemnity in an administration often marked by the opposite. Pence has become, in the words of one ally, a “utility infielder,” and his speeches are relentlessly lauding of Trump.

“The choice in this election has never been clearer and the stakes have never been higher,” Pence said Monday in Charlotte, N.C., before Republican convention delegates voted to renominate Trump. “We’re going to make America great again—again.”

Pence will speak today from Fort McHenry outside Baltimore, inspiration for the “Star-Spangled Banner.” The convention has opened a sort of window into the 2024 Republican primary, featuring speeches by potential Pence rivals including Nikki Haley, Mike Pompeo, Tom Cotton and perhaps even Donald Trump Jr., who is popular among the president’s base.

A win in November will cement Pence as a top-tier candidate to succeed Trump, though by no means a clear front-runner. A loss would severely wound his prospects. If all of Pence’s speeches so far are any indication, he can be expected today to glorify a president who brought him to the national stage and will determine how long he stays there. Read more from Josh Wingrove.

What to Watch Today

Republican National Convention: The third day of the Republican National Convention will feature Pence, along with some supporters of Trump in the House and White House counselor Kellyanne Conway. Today’s theme is “Land of Heroes.” Emma Kinery previews the evening’s main events, starting at 8:30 p.m. Washington time, and where to see them. Read more.

Congress: The House and Senate are not in session today. Both chambers plan to meet in pro forma sessions Friday.

Also in Elections & Politics

Pompeo Stirs Controversy at Convention: Secretary of State Michael Pompeo also capped the Republican National Convention’s second night. Pompeo’s speech delivered while overseas appears to violate State Department guidance that prohibits political activity while on official travel. It’s also a departure from past secretaries who steered clear of conventions. Rep. Joaquin Castro (D-Texas), who is vice chairman of the House Foreign Affairs Committee, wrote to Pompeo’s deputy yesterday demanding documents and a briefing detailing the legal justification for what he called part of “a pattern of politicization of U.S. foreign policy,”

The secretary of state wasn’t the only convention speaker who took advantage of official powers and perks for the convention. Trump issued a pardon on video and presided over a naturalization ceremony at the White House. Read more from Mark Niquette and Jordan Fabian.

One scheduled speaker, Mary Ann Mendoza, was removed from the lineup after she tweeted a conversation that included references to a Jewish plot to enslave the world, Niquette and Fabian report.
White House economic adviser Larry Kudlow defended Trump’s performance, touting the stock market’s surge to a record even as millions of people remain unemployed. Read more from Eric Martin and Naomi Nix.
Kudlow also promised new tax cuts. Eric Trump painted a dark picture of Democratic control. Florida Lt. Gov. Jeanette Nuñez warned against socialism. Pam Bondi, the former Florida attorney general, launched the fullest assault yet on Democratic nominee Joe Biden, reviewing his son Hunter Biden’s work for a Ukrainian energy company, which a Biden spokesman responded was a “conspiracy theory”. Read a recap of night No. 2 of the convention by Bloomberg News.
Trump yesterday pardoned Jon Ponder, a man who robbed a bank in Nevada who was also featured during RNC speeches. Ponder founded a non-profit called Hope for Prisoners that helps former inmates re-enter society. Read more from Jordan Fabian.

Maloney Seeks to Curb Post Office Political Influence: House Oversight and Reform Chairwoman Carolyn Maloney (D-N.Y.) introduced legislation that would restrict political activities of some U.S. Postal Service leaders, according to a statement. The bill follows testimony to the committee Monday from U.S. Postmaster General Louis DeJoy and Chairman of the Postal Service Board of Governors, Robert Duncan, which Maloney said highlighted “their partisan campaign activities, extensive fundraising, and political donations of millions of dollars to GOP candidates and causes, as well as some political activities that continue even now.”

Tune into Bloomberg Government’s AMA on Reddit with legislative analyst Michael Smallberg today at 1 p.m., where he’ll answer questions on what’s happening inside the Postal Service, what Congress is trying to do about it, whether the Postal Service could be privatized, and other topics. Find a link here at 1 p.m.

QAnon Sympathizers Invited to White House: Two House candidates who’ve expressed some support for the conspiracy theory known as QAnon, have been invited to attend Trump’s acceptance speech tomorrow. Marjorie Taylor Greene tweeted that she’ll be attending the event at the White House, along with a copy of the official invitation. Greene, who Trump referred to as “a future Republican star,” won the primary in Georgia’s 14th district and has come under fire for her anti-Muslim remarks and for her comments supporting the movement QAnon. Read more from Ryan Teague Beckwith.

Biden Scolds Trump on Biofuel: Biden said Trump has “sold out” U.S. farmers with his handling of national biofuel policy, according to a statement from the former vice president to Agri-Pulse. Biden decried Trump’s delay in announcing yearly volume targets for the Renewable Fuel Standard and for issuing waivers from the mandate to small oil refineries. Read more from Agri-Pulse.

Ocasio-Cortez PAC Backs Neal Opponent: Rep. Alexandria Ocasio-Cortez’s (D-N.Y.) political action committee has endorsed Holyoke Mayor Alex Morse over longtime incumbent Richard Neal in the Massachusetts Democratic primary. Neal, a leading figure of House Democrats, chairs the tax-writing Ways and Means Committee. Morse in a statement said Ocasio-Cortez inspired him to run for office, Megan Howard reports.

Saudi Prisoners Go Silent During Pandemic: Saudi authorities have severed contact between some of the kingdom’s most prominent detainees and their families, escalating a crackdown on dissent that threatens to strain relations with Western allies. Already, several Saudis in exile have hired American lobbyists or lawyers to push their cases into the spotlight in the period leading up to the U.S. election. Read more from Vivan Nereim.

The Coronavirus Pandemic

Virus Testing Push Leaves FDA Lab Oversight in Limbo: More tests to screen for a variety of ailments will hit the market without FDA oversight under an HHS policy meant to make more Covid-19 tests available, muddying the debate over the agency’s role. While the Food and Drug Administration oversees tests made by commercial companies like Quest Diagnostics, it has more sparingly applied its authority over individual tests developed by labs at health-care centers and universities. The FDA had required emergency approval for these lab-developed tests for coronavirus, but last week the Health and Human Services Department did away with even that cursory oversight to cut red tape.

However, that order goes beyond just coronavirus tests, waiving FDA oversight over all tests from laboratories. The move leaves those lab tests in a regulatory limbo, and reignites a long simmering debate over whether commercial tests and laboratory tests should be regulated differently. It’s a pressing question as a new generation of complex diagnostics can screen millions of DNA changes in a single test. Read more from Jeannie Baumann.

Pharma, Health IT Stay Strong: Health-care transactions lagged in July due to headwinds from Covid-19, but year-to-date deals are well ahead of the same period last year, attorneys and analysts say. The pandemic will likely have an impact on the market beyond the end of the year, according to Epstein Becker & Green attorneys and health industry financial/investment analysts at KPMG and FocalPoint Partners. Read more from Sara Hansard.

FDA-White House Correspondence Probed: Sens. Elizabeth Warren (D-Mass.) and Ed Markey (D-Mass.) yesterday requested copies of all communications between the FDA and Trump administration officials regarding the agency’s announcement this week of an emergency use authorization on convalescent plasma. They cited reports suggesting the FDA granted the EUA “amid intense political pressure from President Trump,” adding, it’s “critical that the FDA’s drug approval process-which serves as the gold standard around the world-is guided by science, not partisan or political whims.” Read the letter here.

In a Sunday press conference with Trump announcing the approval, FDA Commissioner Stephen Hahn said the therapy—blood plasma from recovered patients—could save 35 out of every 100 people who would have died. Those high-profile remarks were incorrect, and they were repeated by others in the administration. Hahn yesterday clarified some of what the data on blood plasma actually show. Hahn spoke to Bloomberg News by phone, calling the scrutiny over the past 48 hours “a challenge.” Read the Q&A here.

Covid Testing Required for All Nursing Home Staff: All nursing homes must test their staff for Covid-19 regularly to detect exposure to the virus under new requirements CMS announced yesterday. There was “good compliance” with previous recommendations that nursing homes test staff routinely in surging states, Centers for Medicare & Medicaid Services Administrator Seema Verma said in a press briefing. But “we want to make sure that every single nursing home is doing this, and if they are not then they’re going to face sanctions,” she said. Read more from Sara Hansard.

Phantom Firms Got More Than $1 Billion in Aid: A federal program meant to help small businesses hurt by the coronavirus pandemic may have sent more than $1 billion to places it shouldn’t have gone, a Bloomberg analysis of Small Business Administration data shows. In some parts of the country, the agency approved far more $10,000 Economic Injury Disaster Loan grants than the number of eligible businesses, the analysis found.

The epicenter was six adjacent congressional districts in the Chicago area, where 81,000 grants were approved even though there are only 19,000 eligible recipients. That’s more than $600 million going to phantom entrepreneurs. Read more from Zachary Mider and Jason Grotto.

Defense & Foreign Affairs

DHS’s Wolf Faces Confirmation Opposition: Chad Wolf’s formal nomination to lead the Homeland Security Department, which would help cement his work so far at the agency, is set to face a chilly reception from Senate Democrats. “Given his past actions, he’d be an awful choice,” said Minority Leader Chuck Schumer (D-N.Y.) in response to Wolf’s nomination. Senate confirmation could eliminate criticism stemming from a recent determination that Wolf and his No. 2 deputy are serving illegally in the acting role, and could help ward against legal challenges to policy changes made in his tenure. Genevieve Douglas and Shaun Courtney have more.

Kim Regime Baffles World With Contradictions: What’s going on with Kim Jong Un? Is he sick? Worried about Covid-19? Consumed by an economic crisis? Battling internal threats? Is he playing the same game of threats, reconciliation and retreat that has kept his family in charge of the secretive state since the 1940s? All those scenarios have been floated to explain months of surprises and intrigue from Pyongyang, including stubborn—but so-far-unsubstantiated—rumors that the 36-year-old leader is unwell. Read more from Jon Herskovitz and Jeong Ho-Lee.

WeChat Ban Said Threatens U.S. Firms’ Revenue: Nearly half of American companies warn of declining revenue if Trump follows through with an order to ban U.S. entities from dealing with the WeChat messaging service, according to a survey from the American Chamber of Commerce in Shanghai. The impact on the firms’ global and China revenue would be substantial should the order be applied to U.S. companies and Americans in China, AmCham Shanghai said, citing a survey of 142 respondents from companies subject to U.S. jurisdiction. Read more from Felix Tam.

China Still Buying $300 Billion of Chips: China will import $300 billion of semiconductors for the third straight year, underscoring how the world’s No. 2 economy remains tied to America despite billions invested in local chip-making know-how. Tech giants from Huawei Technologies to Tsinghua Unigroup and China Electronics are at the forefront of Beijing’s efforts to wean itself off U.S, technology, investing in cutting-edge AI chips, software tools and memory. Yet decoupling from the U.S. threatens the global economy, said Wei Shaojun, vice chair of China Semiconductor Industry Association. Bloomberg News has more.

What Else to Know Today

2 Dead in Wisconsin Protests: Two people died and one person was injured as shots were fired late yesterday in Kenosha during the third night of unrest in Wisconsin following the shooting of a Black man by police, Kenosha police said, according to an Associated Press report. The shooting was reported at about 11:45 p.m. in an area where the protests have taken place, Kenosha police Lt. Joseph Nosalik said in a news release. The injured person is in serious condition at a local hospital with serious but non-life threatening injuries, he said.

The Biden campaign issued a statement following the vandalization of dozens of buildings in Kenosha. “Protesting such brutality is right and necessary. It’s an utterly American response,” said Biden senior adviser Symone Sanders. “Burning down communities and needless destruction is not. Violence that endangers lives is not. Violence that guts and shutters businesses that serve the community is not.” Read more from Bloomberg News.

Trump Order Boosts Opportunity Zones: The White House is highlighting a new executive order as the latest action by Trump to help poor communities, but critics argue opportunity zones may not be the best target of such action. The order, issued Monday, directs federal agencies to give priority to the zones and other distressed areas when considering where to locate offices and other facilities. Read more from Lydia O’Neal.

Drugmakers Deliver Counteroffer to Trump Plan: Drugmakers have made a counteroffer to the White House hoping to hold up Trump’s plan to tie Medicare spending on certain drugs to lower prices that they’re sold for overseas, Politico reports, citing internal memo to drug industry lobbyists. The industry proposes lowering prices for some drugs in Medicare Part B by 10%. The Pharmaceutical Research and Manufacturers of America, the drug industry’s top industry group, approved the proposal Sunday and it was sent to the White House, Politico says, citing a lobbyist. Read more from Politico.

Teva Charged in Generics Price-Fixing Probe: Teva Pharmaceutical Industries was charged by the U.S. with conspiring with its competitors to raise prices for generic drugs, the most significant case to come out of a yearslong investigation of price-fixing by pharmaceutical companies. The three conspiracy charges date back to May 2013, the Department of Justice announced yesterday. Read more from David McLaughlin.

FCC Ends 5G Spectrum Auction, Raises $4.5 Billion: The Federal Communications Commission concluded bidding in its latest auction of 5G-friendly airwaves licenses after raising more than $4.58 billion in proceeds. The FCC will release a notice in a few days detailing the auction results and announcing winning bidders, it said. Read more from Jon Reid.

Uber, Lyft Won’t Eliminate Fights With New Models: The ongoing legal fight in California over the business models used by Uber and Lyft has implications for other industries that rely on independent contractors and may still indicate years of litigation if the ride-sharing companies try shifting to new structures such as franchising. Read more from Erin Mulvaney and Paige Smith.

Artificial Intelligence Research Centers: The Trump Administration announced $1 billion in federal and private funding over the next five years to establish 12 multi-disciplinary and multi-institutional centers to focus on artificial intelligence and quantum information science research. The National Science Foundation, along with several federal partners including the Agriculture Department, will provide $140 million in funding over five years to seven centers focused on machine-learning, synthetic manufacturing, precision agriculture and forecasting prediction, according to the Office of Science and Technology Policy announcement today.

The Energy Department will fund up to $625 million over five years to five national labs: Argonne, Brookhaven, Fermi, Oak Ridge and Lawrence Berkeley to research quantum networking, sensing, computing and materials manufacturing, according to the announcement. Private sector companies, including IBM and John Deere, are also contributing $300 million in funding, a senior administration official said during a press call for the announcement, Rebecca Kern reports.

EPA Touts Winning Record, But Numbers Disputed: The EPA’s top attorney is trumpeting the agency’s success rate in court, saying that it’s won two-thirds of “significant” environmental cases during Trump’s presidency. But the assertion, made by the agency’s general counsel, Matthew Leopold, in an Aug. 10 opinion piece in Bloomberg Law, clashes with—and also comes in response to—other tallies showing judges have largely sided with the EPA’s state and environmental adversaries. Read more from Ellen M. Gilmer.

Hurricane Laura Threatens $18 Billion Disaster: Hurricane Laura is poised to become a roof-ripping Category 3 storm when it comes ashore along the Texas-Louisiana coast this week, threatening to inflict as much as $18 billion in damages on the region and keep some of America’s largest oil refineries shut for months. Read more from Brian Sullivan.

Laura is expected to make landfall as a “major hurricane” with maximum winds of 120 miles per hour, the National Hurricane Center said last night Max Zimmerman reports.
Houston-area residents were told to prepare to take shelter inside their homes for several days as Hurricane Laura approaches the Gulf Coast. Officials from Harris County, which includes the fourth-largest U.S. city, issued the order last night. Political leaders and meteorologists have been warning all day that Laura’s track and intensity may lead to widespread power outages that last for days or weeks. Read more from Joe Carroll.

With assistance from Rebecca Kern

To contact the reporters on this story: Michaela Ross in Washington at mross@bgov.com; Brandon Lee in Washington at blee@bgov.com

To contact the editors responsible for this story: Giuseppe Macri at gmacri@bgov.com; Zachary Sherwood at zsherwood@bgov.com