What to Know in Washington: Trump Improvises Virus Response

Bloomberg Government subscribers get the stories like this first. Act now and gain unlimited access to everything you need to know. Learn more.

America needed hospital gowns, so Donald Trump called up Walmart. For ventilators, he turned to Detroit’s automakers. Wolfgang Puck counseled him on restaurant aid, while a pillow magnate jumped in to help with a mask shortage.

For weeks, the president minimized the threat of the coronavirus, telling the nation it was contained or would soon disappear. But now that the outbreak is sweeping the country, Trump has been forced to constantly overhaul and retool his team and its ad hoc plan to fight it.

He’s trotted out executives and privately called friends and celebrities for insights. He’s lauded some companies, like Ford and Apple, and threatened others, like 3M and General Motors — before praising both. Vice President Mike Pence, Trump’s son-in-law Jared Kushner and Health Secretary Alex Azar all hold murkily defined leadership roles on Trump’s coronavirus task force, with the president routinely overstepping them all.

Democrats led by former Vice President Joe Biden have criticized the president for a U.S. response to the coronavirus outbreak that was delayed and then improvised. More than 350,000 Americans have been infected and more than 10,000 have died, according to Johns Hopkins University, and the White House projects the U.S. death toll may reach 100,000 or more. Trump’s scattershot approach, leaning heavily on his self-made image as a dealmaker, lends weight to signs the government was ill-prepared for the pandemic.

The president has had some success, including a program to create an “air bridge” between the U.S. and foreign suppliers of medical gear that’s brought planeloads of desperately needed hospital masks, gloves and gowns to U.S. cities. The president said Monday that the government has distributed nearly 12 million respirator masks, 26.5 million surgical masks and about 23 million gloves. At Trump’s urging, manufacturers are gearing up to produce thousands of new hospital ventilators, though they may not arrive in time for the peak of the U.S. outbreak this month.

But the president continues to demonstrate his impatience with an outbreak that has collapsed the U.S. economy, robbing him of his chief argument for re-election. Read more from Josh Wingrove.

The new week started off with a bang for U.S. equities. All three major stock benchmarks held on for gains of at least 7% yesterday as investors grew confident that lockdowns in the world’s coronavirus hot spots, including New York, are helping slow its spread, Sophie Caronello reports. The number of daily deaths in the U.S. is still expected to peak on April 16, though the cumulative number of Americans likely to die from Covid-19 was revised downward to 82,000, from an estimate of 94,000 less than a week ago.

What to Watch Today

The House will hold a pro forma at 11:30 a.m.

The White House will hold a Coronavirus Task Force press briefing today at 5 p.m.

Wisconsin’s primary voting will proceed as scheduled today, after the state Supreme Court blocked an attempt to postpone in-person votes over the coronavirus.

Stimulus & Economic Effects

Pelosi Sees $1 Trillion Stimulus: Lawmakers’ next stimulus bill to prop up the U.S. economy reeling under the coronavirus outbreak will be at least $1 trillion, Speaker Nancy Pelosi (D-Calif.) told members of her party yesterday on a private call. The next stimulus package would be focused on replenishing funds for programs established in Congress’s $2.2 trillion virus relief bill signed into law last month, according to people on the call. Pelosi said there should be additional direct payments to individuals, extended unemployment insurance, more resources for food stamps and more funds for the Paycheck Protection Program that provides loans to small businesses, lawmakers on the call said.

Pelosi also said the bill should assist state and local governments, with an emphasis on smaller municipalities with fewer than 500,000 residents, one lawmaker said. Pelosi has said she wants the next stimulus bill to be passed this month. The House isn’t scheduled to be back in session until April 20 at the earliest. It is possible to pass legislation with most members out of town, as long as no one objects. Read more from Billy House and Erik Wasson.

  • Congress is also likely to pass a massive stimulus later this spring that provides $1 trillion just for infrastructure programs, former House Speaker John Boehner (R-Ohio) said. Boehner said the package carrying infrastructure funds will likely be the second of two measures — to be known as “Phase Four” and “Phase Five” — that Pelosi and Senate Majority Leader Mitch McConnell (R-Ky.) assemble in the next several weeks and try to enact by the summer, Nancy Ognanovich reports. “When we get to Phase Five you’re going to see infrastructure in a big way, I think, probably a trillion dollars,” Boehner said yesterday during a conference call organized by the firm Squire, Patton, Boggs. “And a lot of other cats and dogs.” Boehner, now an adviser to the firm, suggested that the infrastructure plan will be financed with emergency spending rather than any increase in user fees, including the federal gasoline tax. “It hadn’t happened over the past 10 years because nobody had come up with a way to pay for it. But now paying for it isn’t on the table,” said Boehner.
  • Boehner also expressed his optimism for a recovery fueled by American nimbleness. “We’re creative, we’re talented, there’s no other group of people on the face of the Earth like Americans,” he said on the call.

Trump’s Bailout Watchdog Draws Praise and Fear: The White House lawyer tapped to oversee disbursements from a massive U.S. pandemic relief fund is a former seminarian with decades of oversight experience yet still faces questions over whether he’ll do Trump’s bidding instead of protecting taxpayers. Brian Miller will be the main watchdog over $500 billion directed to big business by Secretary Steven Mnuchin’s Treasury Department. The spending is part of a more than $2 trillion rescue package passed by Congress to salve an economy suffering under a virus-induced, stay-at-home coma.

Miller, 64, was born in New York City and is a 1977 graduate of Temple University in Philadelphia. He studied at Westminster Theological Seminary, and earned his law degree from the University of Texas School of Law in 1983. Since then he’s probed health care fraud for the Justice Department and monitored spending at the General Services Administration. Todd Shields and Jason Grotto have more.

Top Chefs Seek Restaurant Aid: The Independent Restaurant Coalition, an organization founded during the coronavirus outbreak by well-known restaurateurs including “Top Chef” head judge Tom Colicchio, gathered 5,000 signatures for a letter sent to congressional leadership yesterday asking for more help in the next round of relief legislation. The letter asks lawmakers to create a Restaurant Stabilization Fund, enact tax rebates for the small restaurants that survive the crisis, and make changes to business interruption insurance, which in many cases doesn’t cover the affects of the global pandemic. Read more from Megan R. Wilson.

  • Some of America’s fast-food workers are finally getting face masks and emergency sick days to help get them through the coronavirus outbreak. Now the challenge for labor activists is to capitalize on the moment to win permanent improvements in pay and benefits. The rank and file wouldn’t normally be in position to make demands in a job market that’s suddenly teeming with millions of newly unemployed people. But with restaurant drive-thru and pickup services continuing through the pandemic, restaurant workers braving the front lines have won the moral high ground to ask for more protection from their employers. And, in many cases, they’ve gotten it — a rare victory for employees in an industry known for its resistance to organized labor. Read more from Deena Shanker and Leslie Patton.

Fed Urged to Back Mortgage Servicers: A bipartisan congressional group sent a letter to Federal Reserve Chairman Jerome Powell urging the central bank to prioritize ensuring adequate liquidity for the mortgage servicing market for both single- and multi-family residential and commercial mortgages. They’re also requesting that the Term Asset-Backed Securities Loan Facility program be expanded to include investment-grade agency and private-label MBS and CMBS, as well as CRE CLOs, as eligible collateral. Read more from Charles Williams.

  • Two key bank regulators are holding off on easing Wall Street debt limits in response to the coronavirus pandemic, leaving billions of dollars locked up at banking subsidiaries that could be used for lending amid the deepening economic crisis. For now, the Federal Reserve is the only U.S. banking watchdog that’s relaxed a landmark leverage rule that stipulates how much capital banks must hold against their assets. The Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp., which also enforce the rule, have privately indicated they aren’t yet ready to follow its lead, said three people familiar with the matter. Read more from Jesse Hamilton.

Warnings About Stimulus Scams: Senate Finance Chairman Chuck Grassley (R-Iowa) urged the IRS’s watchdog to do more to educate Americans about potential scams related to economic stimulus payments that will soon be sent out. Grassley in a letter yesterday urged the Treasury Inspector General for Tax Administration to make “every reasonable effort” to raise awareness about potential fraud schemes during the pandemic. He also requested that the IRS’s watchdog brief his panel on efforts to combat coronavirus-related fraud. Read more from Patrick Ambrosio.

Combating an Equipment Shortage

Trump Disputes Report on Shortages: Trump disputed a federal government watchdog’s finding that hospitals are seeing severe shortages of Covid-19 testing kits and protective gear, and suggested a political motive by the official who produced it. “It’s just wrong,” he said of the report at a White House news conference yesterday, without offering any substantiation. He then demanded to know the name of the U.S. inspector general who produced the study. “Give me the name of the inspector general. Could politics have entered into that?”

The inspector general’s office at Health and Human Services yesterday published a report on widespread coronavirus testing and medical supply shortages, based on surveys of more than 300 U.S. hospitals in late March. Read more from Justin Sink and Jordan Fabian.

Imports for Pandemic Response: House Ways and Means Chairman Richard Neal (D-Mass.) and Senate Finance Chairman Chuck Grassley requested the International Trade Commission to investigate and identify the imports necessary for treating and otherwise responding to the coronavirus pandemic. Neal and Grassley requested an ITC report no later than April 30 in a letter sent yesterday. The probe will allow the committees and U.S. Trade Representative Robert Lighthizer to take appropriate actions, they said in the letter, Caitlin Webber reports.

Trump Eases Export Restrictions, Touts Deal With 3M: Trump said his administration reached a deal with manufacturer 3M to produce about 55.5 million masks a month for U.S. health-care workers and others combating the coronavirus. The company said it will be allowed to continue exporting some masks to Canada and Latin America from the U.S. “So the 3M saga ends very happily,” Trump said at the White House news conference. Sink and Fabian have more.

Trump eased restrictions on exports of masks and other protective equipment needed to fight the Covid-19 pandemic just days after their introduction as he confronted a backlash from allies around the world. Faced with domestic criticism of his administration’s handling of the Covid-19 crisis and cries of shortages from hospitals on the front lines, Trump late Friday imposed a ban on exports of N95 masks, surgical gloves and other protective equipment, including from 3M. Read more from Shawn Donnan, Justin Sink, Jordan Fabian and Josh Wingrove.

Inmates to Make Cloth Masks: Federal prisoners have started producing cloth masks to help protect themselves and the correctional officers who guard them from coronavirus, one in a series of actions to try to quash outbreaks across the inmate population. The federal prison industries program is making cloth masks for all federal prisons, while emergency surgical face masks are being given to a limited number of inmates and staffers, according to a Bureau of Prisons memo issued yesterday. Read more from Chris Strohm.

Research, Treatment & Coordination

Big Pharma Makes a Big Bet on a Fast Vaccine: Much about the coronavirus has defied belief—the speed at which it has spread around the world, the insidious way it penetrates the lungs, the unexpected impact it’s having on young people in some parts of the world while sparing them elsewhere. The most effective way to stop it would be to vaccinate the global population. For that to happen in the next year or so, an almost equally implausible set of circumstances has to occur: flawless scientific execution, breakneck trials, and a military-style manufacturing mobilization unlike any the pharmaceutical industry has put in place before. Normally it takes 10 or 15 years of careful lab work and meticulous testing to bring a totally new vaccine to market. For the coronavirus, the drug industry hopes to compress this time frame by tenfold. This may sound like mission impossible, but Big Pharma wouldn’t be working this hard if it didn’t think it had a shot at pulling it off. Read more from Robert Langreth and Cynthia Koons.

Javits Center Has 44 Virus Cases: New York’s Javits Convention Center has just 44 coronavirus patients in treatment so far, and it’ll hit a 1,700-bed capacity this Friday, the Pentagon said, in a signal that the emergency facility provided by the military can offer more aid to the city’s overwhelmed hospitals. Read more from Glen Carey and Roxana Tiron.

  • Meanwhile Trump and New York Gov. Andrew Cuomo (D) confirmed yesterday the 1,000-bed U.S. Navy ship sent to New York City last week will treat coronavirus patients. The USNS Comfort was originally to provide backup support for non-virus infected hospital patients, as Pentagon officials said Friday it wasn’t equipped to treat infectious diseases en masse.

India Partially Lifts Malaria Drug Export Ban on Trump Call: India partially lifted a ban on the exports of a malaria drug after Trump sought supplies for the U.S., according to government officials with knowledge of the matter. Exports of hydroxychloroquine and paracetamol will be allowed depending on availability of stock after meeting domestic requirements and existing orders, said the government officials, who asked not to be identified citing rules. Shipments will be restricted and permission will be on humanitarian ground, they added. Read more from Archana Chaudhary.

  • Meanwhile, former FDA leaders cautioned against shortchanging science in a rush to get unproven Covid-19 treatments like hydroxychloroquine to the marketplace. The comments yesterday, from Margaret Hamburg and Mark McClellan—both former FDA commissioners—join a growing body of voices in the scientific community warning about providing “false hope” to patients looking for a treatment. Read more from jeannie Baumann and Jacquie Lee.

Politics & Elections

Trump Weighs In on Navy Secretary: Trump said he’d weigh in on the acting Navy secretary’s stinging rebuke of an aircraft carrier captain who was relieved of command after raising alarm over the spread of the coronavirus on his ship. “I am going to get involved and see what’s going on there,” Trump said. Captain Brett Crozier of the USS Theodore Roosevelt was ousted last week after writing a memo pleading for assistance with the coronavirus outbreak on the nuclear-powered aircraft carrier sidelined in Guam. On Monday, news groups reported that acting Navy Secretary Thomas Modly told the Roosevelt’s crew that Crozier was “too naive or too stupid to be the commanding officer.” Modly last night apologized for his remarks. Read more from Jordan Fabian and Justin Sink.

Biden Talks With Trump on Virus: Trump and his likely Democratic challenger Joe Biden spoke over telephone yesterday about the coronavirus outbreak after the former vice president offered to share with the administration his ideas for combating the pandemic. Both sides offered positive initial readouts of the 15-minute discussion, with the president calling it “really good,” and Biden deputy campaign manager Kate Bedingfield saying it was a “good call.” Bedingfield said Biden used the call to share “several suggestions for actions the administration can take now to address” the pandemic. Jennifer Epstein has more.

John Lewis Endorses Biden: Rep. John Lewis (D-Ga.), an icon of the Civil Rights movement, endorsed Biden today, becoming the latest Democrat to support the former vice president as he tries to wrap up the Democratic presidential nomination. Lewis’ endorsement comes as Biden has amassed a nearly insurmountable lead in delegates over his only remaining competitor, Sen. Bernie Sanders (I-Vt.). Biden is looking to extend that lead today when Wisconsin holds its primary contest. Read more from Tyler Pager.

Wisconsin Primary to Proceed Today: The Wisconsin primary will proceed as scheduled today, after the state Supreme Court blocked a last-minute attempt by Gov. Tony Evers (D) to postpone in-person votes by an executive order. The state court on a 4-2 vote sided with Republicans who argued that the governor lacked the authority to change the date of the election, meaning that in-person votes will go on despite his stay-at-home order over coronavirus worries. In a separate blow to Evers on Monday, the U.S. Supreme Court reinstated a deadline for mailing absentee ballots in the primary. Read more from Ryan Teague Beckwith.

What Else to Know Today

Labor, Employment Picks Reach Hill by Phone: Trump’s picks for the National Labor Relations Board and the Equal Employment Opportunity Commission will interview with senators and staffers responsible for approving the nominations over the next two weeks, sources familiar with the process said. The interviews, an important part of the nominee-vetting process, will be conducted over phone or other means due to the congressional recess and social distancing measures. Read more from Jaclyn Diaz, Paige Smith, and Chris Opfer.

Inspector General Picks: Trump yesterday sent five nominations to the Senate, including Jason Abend to be the inspector general for the Department of Defense yesterday. Glenn Fine has been serving in an acting capacity in the role since 2016.

Andrew De Mello, a Department of Justice attorney, was nominated fill the inspector general post at the Department of Education, a position that has been vacant for more than a year. The White House last year backtracked on its pick for acting inspector general after congressional Democrats said the nomination of Phil Rosenfelt, an Education Department official, posed a conflict of interest, Andrew Kreighbaum reports.

Peter Michael Thomson was nominated to be inspector general for the Central Intelligence Agency, while Brian Miller was nominated to serve in the new role created under the third coronavirus response package, special inspector general for pandemic recovery. Democrats have criticized the nomination of Miller, who is Trump’s lawyer, to oversee the multi-trillion dollar coronavirus stimulus effort.

Trump Says Free Market Will Curb U.S. Oil Output: Trump gave the strongest signal yet the U.S. might not join Saudi Arabia, Russia and other major producers in coordinated oil-production cuts, even as plunging crude prices put thousands of American shale jobs at risk. While OPEC and its allies prepare for a meeting on Thursday to forge an unprecedented output-cut deal, Trump told reporters in Washington that the free market would work to curb American production. Though the president has touted global output cuts of 10 million to 15 million barrels a day to stabilize prices, he’s been reticent to commit the U.S. to such an effort, suggesting instead that Saudi Arabia and Russia should bear the brunt. Read more from Stephen Cunningham.

With assistance from Andrew Kreighbaum

To contact the reporters on this story: Zachary Sherwood in Washington at zsherwood@bgov.com; Brandon Lee in Washington at blee@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

Stay informed with more news like this – from the largest team of reporters on Capitol Hill – subscribe to Bloomberg Government today. Learn more.

Top