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The Trump administration struck a deal with Senate Democrats and Republicans on an historic rescue package that tees up more than $2 trillion in spending and tax breaks to bolster the hobbled U.S. economy and fund a nationwide effort to stem the coronavirus.
The plan includes about $500 billion that can be used to back loans and assistance to companies, including $50 billion for loans to U.S. airlines, as well as state and local governments. It also has more than $350 billion to aid small businesses. Then there is $150 billion for hospitals and other health-care providers for equipment and supplies.
“At last we have a deal,” Senate Majority Leader Mitch McConnell (R-Ky.) said early today on the chamber’s floor. “I’m thrilled that we’re finally going to deliver to the country.”
Senate Minority Leader Chuck Schumer (D-N.Y.) called it an “outstanding agreement.”
The legislation was still being drafted but McConnell said the Senate would vote on it today. It would still have to pass in the House before it gets to President Donald Trump’s desk. Speaker Nancy Pelosi (D-Calif.) had consulted with Schumer throughout his negotiations with Treasury Secretary Steven Mnuchin. Pelosi said yesterday the House could approve a Senate-passed coronavirus bill by unanimous consent—a procedure that would let the chamber pass the bill without calling members back to Washington—though it’s unclear if any member would object to that plan.
For individuals the package provides direct payments to lower- and middle-income Americans of $1,200 for each adult, as well as $500 for each child. Unemployment insurance would be extended to four months, the benefits would be bolstered by $600 weekly and eligibility would be expanded to cover more workers.
Democrats demanded and won a series of restraints on corporations that would benefit from loans or investments from the Treasury Department, as well as an oversight mechanism for who gets money.
Any company receiving a government loan would be subject to a ban on stock buybacks through the term of the loan plus one additional year. They also would have to limit executive bonuses and take steps to protect workers. The Treasury Department would have to disclose the terms of loans or other aid to companies and a new Treasury inspector general would oversee the lending program. Read more from Josh Wingrove, Laura Litvan and Steven T. Dennis.
With the prospect that Congress was closing in on a deal yesterday, the Dow Jones Industrial Average rose more than 11% in its biggest advance since 1933, and the S&P 500 rebounded with the biggest one-day gain since October 2008 after starting the week with a rout. In Asia markets, U.S. futures pared early losses after news of the deal. Read more on the market response from Vildana Hajric and Ian Sayson.
Trump-Owned Companies Banned From Virus Aid: The $2 trillion stimulus plan would also ban any company controlled by Trump or his children from receiving loans or investments from Treasury programs. According to a summary circulated by Schumer’s office, businesses owned by the president, vice president, members of Congress or heads of executive departments would be excluded from receiving that aid. The block also would also extend to companies controlled by their children, spouses or in-laws. Chelsea Mes has more.
Government Is the Last Spender Left: The coronavirus has turned almost every corner of the economy into a bailout candidate, and forced policy makers to spray cash around on an unprecedented scale—and the chief worry is that it won’t be enough. Congress is set to pass an emergency package worth about 10% of America’s economic output. That’s likely the biggest ever in peacetime—and will push the budget deficit toward levels reached in World War II, above 20% of GDP. Meanwhile, the Federal Reserve has rolled out a credit lifeline worth trillions, exceeding even the measures it took during the 2008 financial crisis. Read more from Katia Dmitrieva.
Other Economic Efforts
Restarting Economy Risks Worse Damage: Trump’s desire to get the economy up and running soon runs the risk of backfiring and making things even worse. With a growing number of state governments ordering business shutdowns, the effort by the president for a return to normal could lead to confusion and harm the efforts of those municipalities to contain the coronavirus contagion. “There is the potential, if the president pushes the view we need to get the economy going, to really just sow chaos throughout the country,” said Maury Obstfeld, a former chief economist for the International Monetary Fund. Read more from Rich Miller and Steve Matthews.
90-Day Deferral of Tariffs: The Trump administration is debating whether to defer payments of duties on imported goods from around the world for three months, people familiar with the talks said. Discussions in recent days involving the U.S. Customs and Border Protection and other government agencies about suspending tariffs for a three-month period sparked push back from domestic industry associations. In a letter to acting CBP commissioner Mark Morgan, the Coalition for a Prosperous America expressed concern that the move was under consideration. Read more from Jenny Leonard.
Covid-19-Related Paid Leave: Businesses won’t be able to count independent contractors toward the 500-employee minimum needed to avoid having to pay workers emergency leave under the coronavirus relief law, but they can include some temporary workers provided by staffing firms in the headcount, the Labor Department said. In question-and-answer guidance posted yesterday, the department’s Wage and Hour Division also said small businesses with fewer than 50 workers can be exempt by documenting that their viability would be jeopardized by the paid sick leave requirement. Read more from Ben Penn.
Prevention & Treatment
Trump’s Handling of Coronavirus Gets Approval: Some six in 10 Americans approve of the job Trump is doing to combat the coronavirus crisis, pushing the president’s approval rating—49%—to the highest of his presidency, according to a poll released yesterday by Gallup.
Trump’s gains come as his standing has improved among Democrats and independents amid the viral outbreak, which has killed hundreds of people even as the nation has adopted strict rules limiting public gatherings. Trump’s job approval numbers are up 6 points among Democrats and 8 points among independents, according to the survey. And voters are largely giving Trump positive marks for his handling of the pandemic, with 94% of Republicans, 60% of independents, and 27% of Democrats approving of his efforts. That’s higher than his general approval rating among each group. Read more from Justin Sink.
Trump’s Target for Ending Lockdown Sets Up Clash With Governors: Trump said he envisions “packed” U.S. churches on Easter Sunday as he described his ambition to abandon stringent public-health measures to combat the coronavirus outbreak and re-open the economy in mid-April. His vision appears increasingly out-of-step with the nation’s state and local leaders, who have ordered entire states and cities shut down in a desperate effort to slow the spread of the virus.
But he drew measured support from Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases, who said it might be possible for parts of the country to return to normal function while others combat outbreaks. Fauci did not, however, address the Easter timeline specifically. “Obviously no one is going to want to tone down things when you see what’s going on in a place like New York City,” Fauci said. “What we don’t have right now that we really do need is, we need to know what’s going on in those areas of the country where there isn’t an obvious outbreak.” Read more from Saleha Mohsin.
As lockdowns spread across the U.S., the U.K. and other countries, early lessons on how effective they’ll be against the new coronavirus are coming from abroad. Even as China moves to lift a quarantine on the original virus epicenter of Wuhan after stanching the outbreak, India and much of Europe are locking down. Comparisons are tricky because of differences in the outbreak severity, testing regimes and health-care systems in each country.
Countries like South Korea have countered the pandemic successfully without large-scale quarantines, relying more on tools like testing and contact tracing. Even so, the numbers are cause for optimism that a global clampdown on public life is helping to slow the spread of the virus. The question is how long the measures will need to last to ensure the outbreak doesn’t surge again. Naomi Kresge and Samuel Dodge have more.
White House Calls for Quarantine for All Leaving New York: The White House urged anyone who has been in New York to self-quarantine for 14 days to stop the spread of the coronavirus, which has become widespread in the city. “You may have been exposed before you left New York,” Deborah Birx, the State Department doctor who is advising Vice President Mike Pence, said at a White House news conference yesterday. “Everybody who was in New York should be self-quarantining for the next 14 days to ensure that the virus doesn’t spread to others.”
Pence said the federal government was “surging resources” to the New York area, including 4,000 ventilators in the next 24 hours. Read more from Saleha Mohsin and Josh Wingrove.
Trump Invokes Production Law for ‘Leverage’: Trump said he invoked a U.S. law that allows the government to order industrial production for “leverage” with companies making supplies to combat the coronavirus outbreak, but that he hasn’t had to exercise the authority. “It’s called leverage,” Trump said of the Defense Production Act at a White House news conference. “Companies are doing as we asked, and companies are even better than that—they’re coming through and they’re calling us.”
U.S. Aims to Convert Hotels Into Hospitals: The U.S. Army Corps of Engineers is urgently seeking commercial companies that know how to convert hotels into hospital space, as infections rise in populous areas such as New York City and hotels sit empty amid the pandemic. The corps’ contracting office in Little Rock, Ark., is putting out feelers in a draft request for proposals for companies that can convert hotel space to an acute alternate care facility in support of treatment for Covid-19 patients. The magnitude and type of contract is yet to be determined, the notice said. Read more from Roxana Tiron and Robert Levinson.
Pentagon Looks to A.I.: The Pentagon envisioned using artificial intelligence for humanitarian relief after typhoons in the Pacific and now it’s looking at ways to employ the nascent technology to respond immediately to the new coronavirus outbreak at home. The Joint Artificial Intelligence Center, which leads Pentagon development of A.I., is deep in conversations with U.S. Northern Command and the National Guard Bureau about the possibility, said Lt. Gen. Jack Shanahan, the center’s director. It could use commercial, academic, and government data sources to coordinate efforts to mitigate harm from the virus, identify infection hotspots, and potentially direct the deployment of Guard forces and resources.
Meanwhile, the number of National Guard troops deployed across the country to combat the virus has surged from hundreds last week to nearly 10,000 as of yesterday. Increasing numbers of infection across the country are likely to bring in a bigger military role, which is managed at the federal level by Northern Command and the Guard Bureau. Read more from Travis J. Tritten.
Training Amid Pandemic: American health-care systems will get $100 million in federal funds to provide training and resources to hospitals, emergency medical services, and 911 call centers, the HHS announced yesterday. HHS’s Office of the Assistant Secretary for Preparedness and Response will direct the funds to three health facilities that previously cared for Ebola patients, 10 regional pathogen treatment centers and 62 hospital preparedness partners, among other groups. The funds were part of the supplemental appropriations bill signed into law this month. Read more from Shira Stein.
Trump-Backed Drug No Better Than Care, Study Shows: Hydroxychloroquine, a medicine for malaria that Trump has touted as a treatment for coronavirus, was no more effective than conventional care, a small study found. The report published by the Journal of Zhejiang University in China showed that patients who got the medicine didn’t fight off the new coronavirus more often than those who did not get the medicine. The study involved just 30 patients. Of the 15 patients given the malaria drug, 13 tested negative for the coronavirus after a week of treatment. Of the 15 patients who didn’t get hydroxychloroquine, 14 tested negative for the virus. Read more from Michelle Fay Cortez and Claire Che.
What Else to Know
Trump Says He’ll Stop Using ‘Chinese Virus’: Trump said he would stop using the term “Chinese virus,” the latest indication that the U.S. and China are seeking to deescalate their blame game over the deadly pandemic. “I don’t regret it, but they accused us of having done it through our soldiers, they said our soldiers did it on purpose, what kind of a thing is that?” Trump said in an interview yesterday with Fox News. “Look, everyone knows it came out of China, but I decided we shouldn’t make any more of a big deal out of it. I think I made a big deal. I think people understand it. But that all began when they said our soldiers started it. Our soldiers had nothing to do with it.” Read more from Karen Leigh.
Biden’s SCOTUS Shortlist: Trump reassured conservatives in 2016 with a shortlist of 25 Supreme Court nominees he said he would choose from. Former Vice President Joe Biden’s list is much shorter.
During the March 15 Democratic presidential debate, Biden promised to appoint a black woman to the nation’s highest court if elected. On ABC’s “The View” on Monday, he said he had four women in mind. “There are at least four women that I think are fully capable and their background suggests they would be great additions to the court,” he said. “The Supreme Court more than any other institution should reflect what the country looks like.”
Biden did not name any names, but the answer came in response to a question that mentioned U.S. District Court Judge Ketanji Brown Jackson, who was considered for a Supreme Court opening in 2016 by former President Barack Obama. Obama instead chose Merrick Garland, a white man whose nomination was never voted on. Read more from Ryan Teague Beckwith.
Free-Speech Suit Against Trump Gets Go-Ahead: Free-speech advocates can move forward with a lawsuit alleging Trump violated the Constitution by threatening journalists and news organizations who have criticized his administration. U.S. District Judge Lorna Schofield yesterday denied Trump’s request to throw out the case, saying the threats are credible because Trump has barred reporters from press conferences before and revoked CNN correspondent Jim Acosta’s credentials. Read more from Chris Dolmetsch.
Kids’ Climate Case: The Trump administration yesterday urged federal judges to dismiss a rehearing request brought by 21 young plaintiffs who recently lost their ambitious climate lawsuit against the federal government. Department of Justice attorneys said the U.S. Court of Appeals for the Ninth Circuit was right to dismiss the well-known “Juliana case” in January, after saying it couldn’t provide the primary relief that the litigants sought: a plan to draw down U.S. reliance on fossil fuels. Read more from Ellen M. Gilmer.
Prince Charles Tests Positive for Covid-19: Prince Charles tested positive for the coronavirus, according to BBC News, citing a statement, Dow Jones reports. The 71-year-old heir to the throne is displaying mild symptoms “but otherwise remains in good health,” the report said quoting a spokesman. His wife, The Duchess of Cornwall, was tested but does not have the virus, the report said.