Treasury Secretary Steven Mnuchin and Senate Democrats are pushing to expand the Senate GOP’s economic rescue plan to respond to the coronavirus pandemic, continuing negotiations into the weekend on a package expected to exceed $1 trillion.
Senate Majority Leader Mitch McConnell (R-Ky.) said he wanted to finalize an agreement yesterday, but the Republican and Democratic senators working out the details called it a night without a final deal. They promised to return today to continue talks, with the goal to vote Monday.
Senate Minority Leader Chuck Schumer (D-N.Y.) wants an expanded package that would spend far more on workers and on responding to the health care crisis, while Mnuchin wants more to bolster the economy, including direct payments to more Americans, according to people familiar with his thinking.
“Both sides have issues that they have to go back and check on” with their parties, Sen. Ron Wyden (D-Ore.) said last night. “We’re going to be here early tomorrow morning.”
McConnell filed for cloture, or to limit debate, on the motion to proceed to the shell vehicle for the legislation, H.R. 748. The Senate will meet at noon to resume consideration of the motion to proceed to the measure. Billy House, Colin Wilhelm and Jack Fitzpatrick have the latest.
What’s Being Negotiated: McConnell and Schumer have each proposed their own sweeping plans that four groups of senators spent much of Friday trying to reconcile. Schumer spoke with Trump Friday, and both Schumer and Speaker Nancy Pelosi (D-Calif.) spoke several times with Mnuchin.
- The GOP proposal, introduced as S. 3548, includes tiered tax rebates of as much as $1,200 for middle-income individuals, $208 billion worth of loans for companies suffering because of the coronavirus pandemic and another $300 billion dedicated to smaller businesses. (Read the BGOV Bill Summary of McConnell’s legislation.)
- Mnuchin has proposed two $1,000 checks at a cost of about $500 billion — substantially more generous than McConnell’s bill. Those direct payments wouldn’t be based on income level, as in the GOP proposal.
- Lawmakers yesterday were nearing an agreement to give low-income individuals the full tax rebate, rather than the smaller amount in the GOP version, according to multiple people familiar with the talks. They also were close on increased unemployment insurance, a central Democratic ask. The two issues appear to be intertwined, and final numbers for the emergency benefits will in part depend on what feedback negotiators receive from other senators, as well as the administration and potentially House leadership.
- The Senate GOP’s proposal rejects Democratic calls to expand paid leave measures for workers, which could complicate efforts. Democrats approved changes that Senate Republicans requested to paid leave provisions of H.R. 6201, under the notion that subsequent legislation would fill remaining gaps for workers. Read more from Jaclyn Diaz.
- Also not in the plan so far is any direct infusion of federal aid to U.S. airports. The plan would give airlines $58 billion in loans and relieve them of ticket taxes that feed into the federal airport project fund. But it wouldn’t send any cash directly to airports, which asked Congress earlier this week for $10 billion to cover immediate cleaning costs, debt payments, and keeping their workers employed. A group representing U.S. airports estimated yesterday that the facilities could lose nearly $14 billion in revenue. Courtney Rozen has more.
Latest on the Coronavirus: Trump declared that a major disaster exists in the state of New York and ordered federal assistance to be given. New York City, which accounts for almost a third of confirmed U.S. coronavirus cases, is closing non-essential businesses. Singapore, Israel, Mauritius and Lithuania had their first virus deaths. More U.S. states followed New York and California in tightening restrictions on the public and business. U.S. stocks fell, capping their worst week since the 2008 financial crisis. Goldman Sachs warned the U.S. economy may shrink 24% in the second quarter. Bloomberg is following the latest developments here.
Groups, States Lobby for Relief
Response Legislation Spurs K Street Hiring Spree: Businesses and industry groups are leaning heavily on K Street to ensure their interests aren’t left behind as lawmakers scramble to assemble legislation that helps revive the economy and keep an array of industries from crumbling amid the coronavirus pandemic. There have only been a handful of new lobbying registrations that specifically mention the response measures to the coronavirus, Covid-19, outbreak or an economic stimulus package, according to lobbying disclosures. However, the actual number is likely much higher, as firms have as long as 45 days after signing a client to file paperwork.
“I think people will definitely want to explore reinforcing their lobbying teams. If you ever wanted to have all your bases covered in the advocacy space, it would be now,” said Arshi Siddiqui, a partner at Akin Gump Strauss Hauer & Feld and former aide to Pelosi. “So I think there will be an uptick.” Read more from Megan R. Wilson.
Companies Must Prove Distress: To receive a slice of the $150 billion in emergency virus aid Republican senators are proposing, a company will have to prove to the Treasury secretary it’s distressed and possibly agree to make Uncle Sam a co-investor. The GOP-backed bill introduced Thursday calls for Mnuchin to oversee a $208 billion loan program via the department’s Exchange Stabilization Fund, which is used to buy and sell foreign currencies, among other functions. Of that amount, $50 billion would be allocated to passenger airlines while $8 billion is reserved for cargo haulers. The remaining $150 billion is set aside for other “severely distressed sectors” that have been pushed to the brink by the virus, according to the bill text. Another $300 billion is aimed at helping smaller businesses.
It’s unclear how the virus bailout money will be administered, but the most recent precedent comes from the 2009 financial crisis, when the U.S. allocated $700 billion to bail out banks and automakers as the collapse of high-risk mortgages rippled through the American economy. The government took stakes in car companies and banks that gave it oversight over many aspects of their operations. Read more from Ryan Beene, Ben Brody and Naomi Nix.
Meanwhile, Mnuchin is seeking to tap executives from Goldman Sachs and other Wall Street firms to help oversee the aid packages, people familiar with the matter said. Mnuchin’s team is considering executives with broad experience to help administer loans to airlines, hotels and other industries suffering as the virus shuts down parts of the economy, the people said. The government is also considering taking equity stakes in some companies in exchange for aid, a program that financiers and bankers could administer. Read more from Saleha Mohsin and Sridhar Natarajan.
Four States Want $100 Billion in Aid: The governors of New Jersey, New York, Connecticut, and Pennsylvania called on the federal government to consider an economic stimulus of at least $100 billion in cash payments to the states to help cover the cost of coronavirus response operations. The group made its request yesterday in a letter to Trump and congressional leadership. Together, the four states represent 16% of the U.S. economy. After ordering the shutdown of schools and nonessential businesses, the governors are forecasting billions of dollars in lost income from sales taxes and other revenue sources. Read more from Elise Young and David Voreacos.
Nuclear Industry Faces ‘Severe’ Strain: The nuclear industry is seeking grants and other aid in the face of the coronavirus outbreak, according to a letter from the Nuclear Energy Institute. “Our member companies are anticipating – or are already experiencing – severe financial strain as product orders are delayed or canceled,” the group wrote in a letter to Mnuchin and Larry Kudlow, director of the National Economic Council. The industry is seeking a 30% investment tax credit for some expenditures converted into grants, and grants for paid leave and “prioritized access” to testing and masks, Ari Natter reports.
Treatment, Research & Prevention Efforts
A Third of Citizens Told to Stay Home: Governors from coast to coast yesterday told Americans not to leave home except for dire circumstances and ordered nonessential business to shut their doors. New Yorkers and Illinoisans were told that their freedom of movement, and motives for it, would be curtailed drastically: nonessential businesses must close and all but emergency travel is discouraged. Those residents — plus those in California, Connecticut, Nevada and Pennsylvania, all with strict orders of some kind put in place Thursday — compose about one-third of the U.S. population of 328 million. Read more from Elise Young.
Google Launches Coronavirus Website: Google launched a website dedicated to information about Covid-19 a week after Trump touted the company’s help in the fight against the pandemic. The internet giant said it worked with “relevant agencies and authorities” to roll out the site — google.com/covid19 — which went live on the web late yesterday offering education, prevention and local resources related to the novel coronavirus.
At the top of the site, there’s an information box describing virus symptoms, treatment, and prevention tips from the World Health Organization. Google also included links to state departments of health across the U.S., search trends related to Covid-19, and other resources for individuals, educators and businesses. Read more from Mark Bergen.
Hospitals Stockpile Drug Trump Says Could Treat Covid-19: Hospitals have been rushing to stockpile a decades-old antimalarial drug touted by Trump and others as a treatment for the new coronavirus. Hydroxychloroquine is being snapped up by medical systems at more than twice the typical pace as U.S. hospitals seek to build large inventories in anticipation of the medication’s potential use in patients with Covid-19, the respiratory illness caused by the coronavirus. Hydroxychloroquine and its more-toxic cousin chloroquine, which are also commonly used to treat rheumatoid arthritis and lupus, haven’t been approved by the FDA for Covid-19. Read more from Riley Griffin.
FDA Warns of At-Home Test Kits: The FDA told consumers yesterday that it hasn’t authorized at-home testing kits for consumers to test themselves for the new coronavirus. “The FDA sees the public health value in expanding the availability of COVID-19 testing through safe and accurate tests that may include home collection, and we are actively working with test developers in this space,” the agency said in a statement, Jacquie Lee reports.
States Await Navy Ships: Governors in California and Washington are awaiting word on where a U.S. Navy relief ship will dock during its deployment to provide extra hospital beds amid the coronavirus outbreaks. Washington Gov. Jay Inslee (D) and California Gov. Gavin Newsom (D) requested the USNS Mercy to care for patients other than those with coronavirus. Their states are expecting a surge in patients suffering with Covid-19. The Navy has no timeline on when the decision on where to locate the Mercy will be made, spokesman Lt. Samuel R. Boyle said yesterday. Read more from Joyce E. Cutler.
Finding Coronavirus Disinfectants: Disinfectants manufacturers held a virtual meeting with the head of the Environmental Protection Agency yesterday as the agency fast-tracks more chemical products to fight Covid-19. EPA Administrator Andrew Wheeler yesterday held a series of conference calls with the Consumer Brands Association and Household & Commercial Products Association, among others, to discuss the EPA’s expedited process to approve new disinfectants to prevent Covid-19. Read more from Adam Allington and Pat Rizzuto.
More Coronavirus Developments
Potential Deportation of ‘Dreamers’: A group of Senate and House Democrats is requesting more information from the Department of Homeland Security on the agency’s plans to potentially deport young, undocumented immigrants who came to the U.S. as children. In a letter released yesterday, lawmakers said they are “gravely concerned” that the administration is preparing “mass deportations of Dreamers” whose cases were “administratively closed” but then subsequently reopened. Read more from Genevieve Douglas.
Meanwhile, Customs and Border Protection will turn away migrants crossing the border without documents, rather than holding them in cramped facilities where social distancing to avoid Covid-19 infection isn’t possible, the Trump administration announced yesterday. The Centers for Disease Control and Prevention invoked Section 362 of the Public Health Service Act to block entry to the U.S. of migrants coming from Mexico or Canada because of the public health threat they pose, Health and Human Services Secretary Alex Azar said at a White House briefing yesterday. The order applied to undocumented migrants trying to enter, not to U.S. citizens or lawful permanent residents. Read more from Shaun Courtney.
First Cases at Pentagon: A defense contractor who works for the U.S. Air Force in the Pentagon and a service member who visited the building on Monday have both tested positive for coronavirus, the Air Force said in a statement yesterday. The contractor was last in the building on March 2 and worked at a symposium at Joint Base Andrews in Maryland from March 3 to 6, while the service member works at the Defense Health Agency in Falls Church, Va. Both received medical treatment and are self-quarantined at home, Travis J. Tritten reports.
Trump Escalates China Claim: The Trump administration escalated its attacks on China over the coronavirus, as U.S. officials publicly alleged that Beijing had concealed and minimized the disease’s spread within its borders until it was too late to stop a global outbreak. Trump and Secretary of State Mike Pompeo both called the illness the “Chinese virus” at the White House, rejecting criticism from Beijing and U.S. critics that the term is offensive. Pompeo also demanded China release more data on the virus’s spread, saying lives could be at risk otherwise. Read more from Jordan Fabian.
Elections, Politics & Policy
Stock Sales Likely to Prompt Ethics, Voter Scrutiny: Government watchdog groups have called for investigations by ethics officials, prosecutors and regulators of sales of stock by senators briefed in January on the coronavirus threat. Still, enforcement experts say that the trades are unlikely to lead to direct regulatory or legal sanctions, leaving it to ethics officials and voters to decide whether the senators crossed the line.
Sens. Richard Burr (R-N.C.), Kelly Loeffler (R-Ga.), James Inhofe (R-Okla.), and Dianne Feinstein (D-Calif.) have defended the transactions, asserting they weren’t related to any information they received as part of their congressional duties. Burr yesterday called for the Senate Ethics Committee to investigate his transactions. Read more from David Kocieniewski and Greg Farrell.
Trump, RNC Outstrip Democrats in Fundraising: Trump’s re-election effort maintained its financial advantage over the Democratic Party in February, filings at the Federal Election Commission show. The Republican National Committee ended the month with $76.8 million cash on hand after raising $26.2 million, more than double the $12 million brought in by the Democratic National Committee. It ended the month with $14.1 million in the bank. Read more from Bill Allison.
Bloomberg Gave Almost $1 Billion to Campaign: Michael Bloomberg put a record $935 million into his short-lived Democratic presidential campaign through February, including $474 million last month alone, according to his monthly FEC filing on Friday. The former New York City mayor’s spending in February was a record monthly total for a presidential campaign and brought his total campaign spending to $875 million dollars. He ended the month with $60.6 million in the bank plus debts of $31.7 million, the report shows. Read more from Bill Allison and Mark Niquette. (Bloomberg is the founder and majority owner of Bloomberg Government’s parent company. He endorsed Biden on March 4).
Mississippi Delays GOP Runoff: Mississippi Gov. Tate Reeves (R) postponed the state’s March 31 Republican primary runoff in the 2nd Congressional District to June 23 due to outbreak concerns, according to a statement from his office. The runoff is between Thomas Carey and Brian Flowers. The winner will move ahead to the general election this November to face Rep. Bennie Thompson (D), the chairman of the House Homeland Security Committee, Ben Livesey and Emma Kinery report.
Senators Call for Probe Into Oil Dumping: Nine U.S. senators called on Commerce Secretary Wilbur Ross to start an investigation into what they described as the “excessive dumping” of oil by Russia and Saudi Arabia that has contributed to the worst price crash in a generation. Sen. Lisa Murkowski (R-Alaska), chairman of the Senate Energy and Natural Resources Committee, joined fellow Alaska Sen. Dan Sullivan (R) and seven others in calling for the Trump administration to take action to counter “manipulation” of markets that has inflicted “severe trauma” upon the U.S. energy industry. “As secretary, all of your authorities related to imports, national security, and safeguards should be considered for the most appropriate and expeditious response,” they wrote in the letter dated Friday. Read more from Stephen Cunningham.