What to Know in Washington: Trump Weighs $1T for Infrastructure

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

The Trump administration is preparing a nearly $1 trillion infrastructure proposal as part of its push to spur the world’s largest economy back to life, according to people familiar with the plan.

A preliminary version being prepared by the Department of Transportation would reserve most of the money for traditional infrastructure work, like roads and bridges, but would also set aside funds for 5G wireless infrastructure and rural broadband, the people said.

President Donald Trump is scheduled to discuss rural broadband access at a White House event on Thursday.

An existing U.S. infrastructure funding law is up for renewal by Sept. 30, and the administration sees that as a possible vehicle to push through a broader package, the people said. They asked not to be identified because the Trump proposal isn’t final and hasn’t been announced.

The draft plan is emerging as lawmakers from both parties and Trump debate the timing and scope of more stimulus for a U.S. economy plunged into recession by nationwide lock-downs needed to halt the spread of coronavirus. It’s the latest sign of momentum in Washington for some kind of infrastructure spending blitz ahead of the election.

House Democrats have offered their own $500 billion proposal to renew infrastructure funding over five years. It’s unclear how long the administration’s draft would authorize spending or how it would pay for the programs. The House Transportation and Infrastructure Committee is scheduled to mark up that measure tomorrow.

Trump is pushing to rev up the U.S. economy — which four months ago was the centerpiece of his argument for a second term — as he trails Democrat Joe Biden in most national polls. The White House has explored ways to shift the next round of federal virus aid from personal financial support to growth-fostering initiatives, such as infrastructure spending. Read more from Jenny Leonard and Josh Wingrove.

Coronavirus & the Economy

Schumer, Brown Tell Pandemic Watchdog to Resist Trump Pressure: Senate Minority Leader Chuck Schumer (D-N.Y.) and Sen. Sherrod Brown (D-Ohio), the Banking Committee’s top Democrat, told the new watchdog in charge of overseeing the pandemic corporate bailout fund they’re concerned he won’t be independent from his former employer: The White House. Brian Miller, the newly confirmed special inspector general for pandemic recovery, had most recently served as a White House lawyer and participated in Trump’s impeachment defense.

“You must resist influence or pressure, uphold the law, and protect taxpayers’ interests — even if it places your job at risk,” the senators said in the letter today. “Ultimately, your duty is to the American people, not the president.” Read more from Laura Davison.

Providers Accused of Bilking Medicare Get Aid: Health-care providers accused of bilking taxpayers by inflating Medicare or Medicaid expenses have paid billions of dollars in settlements with the federal government over the past decade for a variety of transgressions, some of which risked patients’ lives. Now the money is flowing the other way. Companies that settled cases involving overbilling or fraud received more than $36 billion in interest-free loans from a Health and Human Services Department program to help providers handle cash-flow shortages caused by the pandemic, according to data compiled by Bloomberg and Good Jobs First, a watchdog group that has been monitoring federal relief payments. That’s more than one-third of the $100 billion distributed through the loan program. Read more from David Kocieniewski and Caleb Melby.

Fed Adapts on Credit Risk: Jerome Powell’s dramatic bid to insert the Federal Reserve into protecting private companies from the fallout of the coronavirus is finally underway, but the central bank is nervous about managing the long-term risk. As the chairman prepares to testify before Congress, starting with the Senate Banking Committee at 10 a.m., the back-story of how the central bank became lender of last resort to Main Street shows the extreme lengths to which officials were ready to rewrite their old crisis playbook to confront Covid-19. Read more from Saleha Mohsin and Craig Torres.

Moderna Sees Vaccine Efficacy Data in Fall: Moderna CEO Stephane Bancel said efficacy data for its Covid-19 vaccine could be available by as soon as Thanksgiving if everything goes right. Moderna’s coronavirus vaccine is in second-stage trials, with final-stage trials set to begin next month on 30,000 people. In an interview on Bloomberg Television yesterday with David Rubenstein, Bancel said in a best-case scenario “we could have efficacy data by Thanksgiving. This is the best time line.” Read more from Robert Langreth.

The First Vaccines May Not Prevent Infection: Desperation for a way to keep economies from collapsing under the weight of Covid-19 could mean settling for a vaccine that prevents people from getting really sick or dying but doesn’t stop them from catching the coronavirus. An FDA spokesman said the agency would “potentially consider an indication related to prevention of severe disease, provided available data support the benefits of vaccination.” Read more from John Lauerman and James Paton.

Antibody Tests Are Confusing Everyone: Antibody test takers are seeking certainty, wanting to know if that bad flu they had in February was actually Covid-19—and whether that means they’re at lower risk of getting it again. But antibody tests, which hunt for signs in a person’s blood that they’ve been exposed, provide little if any actionable information. Many have been plagued by questions about their accuracy. And even if a test is accurate, experts have no solid proof that antibodies mean a person is immune to the virus, or good data on how long that immunity might last. Some people “mistakenly view antibodies as a get-out-of-jail-free card to return to normal life, a dangerous misconception,” Rep. Raja Krishnamoorthi (D-Ill.), chairman of the House subcommittee on economic and consumer policy, told a virtual hearing earlier this month. The subcommittee estimates that millions of people have taken the tests. Read more from Kristen V Brown.

U.S. Airlines Get Tough on Masks: U.S. airlines will step up efforts to enforce the use of face coverings for travel, warning that companies could suspend flight privileges for passengers who flout the rules amid the Covid-19 pandemic. Seven major carriers have agreed to beef up communications about mask requirements and the penalties for violating them, trade group Airlines for America said in a statement yesterday. Still, punishment isn’t necessarily automatic, and one major carrier, American Airlines, is counseling flight attendants to de-escalate standoffs with customers. Read more from Mary Schlangenstein.

SBA Resumes Applications for Small Firm Disaster Loan Program: The Small Business Administration said it resumed accepting applications yesterday from small businesses for a disaster-aid program, known as the Economic Injury Disaster Loan program, plagued by criticism about capped funding and delays. Read more from Mark Niquette.

Policing Overhaul Efforts

Qualified immunity—which prevents people from suing individual police officers who violated their constitutional rights—lost at the Supreme Court yesterday and won’t be part of Trump’s executive order being signed today, top officials said yesterday, Shaun Courtney reports.

The executive order on police coming out of the White House will address police training and certification, information sharing to track excessive use of force complaints across departments, and co-responder programs for mental health and homelessness, a senior administration official said in a background press briefing.

It will not address qualified immunity and it is unlikely that the president would sign a bill that came to him with that provision included, the official said. The White House will also call on Congress to provide funding legislation.

The remarks came the same day the Supreme Court opted not to hear several cases involving the qualified immunity rule that shields law enforcement officers and other public officials from civil suits for rights violations.

“The Supreme Court’s failure to reconsider this flawed legal rule makes it all the more important for Congress to act,” House Judiciary Committee Chairman Jerrold Nadler (D-N.Y.), Congressional Black Caucus Chair Karen Bass (D-Calif.), and Constitution, Civil Rights, and Civil Liberties Subcommittee Chair Steve Cohen (D-Tenn.) said in a joint statement.

The order would prioritize federal grants for law enforcement agencies that train their officers with de-escalation tactics and curb the use of chokeholds. Read more from Jordan Fabian.

Senate Police Bill Vote Seen Unlikely by July 4: A bill that would overhaul U.S. policing isn’t likely to advance in the Senate before the July 4 recess, Senate GOP Whip John Thune (R-S.D.) and Senate Rules Chairman Roy Blunt (R-Mo.) said yesterday. ”Realistically, I think it will take longer than that to reach a conclusion,” Blunt said. Thune also said the Senate taking up police overhaul before July 4 is unlikely, according to a Politico reporter tweet.

But Sen. Tim Scott (R-S.C.), who’s working on Senate Republicans’ measure, said waiting a month is a “bad decision,” Laura Litvan reports.

Scott said it’s important for the chamber to take a vote on the matter before the July 4 recess to get lawmakers on record and that “if it fails, it fails.”

Speaking to reporters in the Capitol, the Senate’s only Black Republican also expressed some doubt that lawmakers in both parties could agree on final legislation designed to address civil rights concerns after the May 25 death of Floyd.

Speaker Nancy Pelosi (D-Calif.) told CNN choke-holds are a form of lynching and she thinks there will be bipartisan agreement on a policing overhaul measure that bans the practice, Ben Livesey reports.

Elections and Influence

Trump’s Tulsa Rally Defies Public Health Concerns: Trump’s resumption of his signature campaign rallies this week is intensifying criticism of his response to the biggest domestic crises of his presidency: The deadly coronavirus pandemic and widening protests over police brutality against Black Americans.

The June 20 rally in Tulsa, Okla., is shaping up as a nightmare scenario for public health officials. Trump plans to address supporters inside an arena that holds nearly 20,000 people, with no special capacity limits, despite concern that crowded, indoor events are ideal for transmitting the coronavirus. The campaign plans to give a mask and hand sanitizer to everyone who attends — and require them to agree to a waiver absolving the campaign of liability if they get sick. Read more from Josh Wingrove.

Biden Fundraiser With Warren Nets $6 Million: Democratic presidential nominee Joe Biden pulled in his largest single-event fundraising haul last night, collecting $6 million with Sen. Elizabeth Warren (D-Mass.) as a co-host of the virtual event. Last week, Biden co-hosted a fundraiser with another potential running mate and former presidential rival, Sen. Kamala Harris (D-Calif.). That brought in more than $3.5 million. Read more from Tyler Pager.

  • Biden will enlist his old boss, Barack Obama, the Democratic Party’s all-time biggest fundraiser, to convince grassroots donors to open their wallets. Obama will headline a virtual fundraiser on June 23, with the price of admission set at just $15. The former president raised a record $745 million for his campaign committee in 2008. Read more from Bill Allison.

Trump Leads Biden by 1 Point in Iowa Poll: Trump has a 1 percentage-point advantage over Biden in Iowa, a state the president decisively won by 9 points in 2016, according to a poll. The Des Moines Register survey released last night found Trump leading Biden 44% to 43%, within the margin of error of 3.8 percentage points. Read more from Tyler Pager.

Fate of Maine Ranked Choice Law in Hands of Election Official: Maine was to become the first state to use ranked choice voting to pick a president but that option is uncertain because of an effort by the Maine Republican Party to repeal the state’s ranked choice presidential election law. Ranked choice allows voters to rate three or more candidates on a ballot from their first choice to their last. If no candidate wins 50%, the last-place candidate is dropped and those votes are redistributed. Read more from Adrianne Appel.

What Else to Know Today

NOAA Pressured to Back Trump-Dorian Claims: The National Oceanic and Atmospheric Administration faced political pressure from the Department of Commerce to support Trump’s claims last year that Hurricane Dorian may hit Alabama, according to the National Academy of Public Administration, a body authorized by Congress to review government conduct. The group confirmed two violations of the agency’s scientific integrity policy. Stephen Lee has more.

LGBT Decision Eases Path for Health Bias Battle: Civil rights advocacy groups planning to challenge the White House rule that eliminates anti-discrimination protections for LGBT people in health care just got a major boost from the U.S. Supreme Court. In a ruling yesterday, the justices said that anti-discrimination protections in the workplace extend to gay and transgender people. While the verdict focused on the definition of the word “sex” under the Civil Rights Act, scholars and attorneys said it will likely to have a direct effect on how sex is defined in a myriad of other laws, including the Affordable Care Act. Lydia Wheeler has more.

  • Separately on LGBT issues, employer-backed health insurance plans would no longer have to comply with a federal health nondiscrimination law after the White House moved to curtail Obamacare protections for LGBT people and those who’ve had or are seeking abortions. The rule, which lets health-care workers, hospitals, and insurers that receive federal funding refuse to provide or cover any services to those people, has wider implications, such as for those with disabilities, living with HIV/AIDS and others with extensive health needs or chronic conditions. Read more from Shira Stein.
  • The court’s landmark decision holding that employers can’t discriminate against workers based on their sexual orientation or gender identity has a glaring loophole: It doesn’t apply to small businesses that employ as many as one in six Americans. Read more from Erik Larson and Jeff Green.

SCOTUS Urged to Toss Keystone Ruling: The Trump administration urged the Supreme Court to toss a high-stakes Keystone XL pipeline ruling that’s stunted permitting for oil and gas pipelines nationwide. Solicitor General Noel Francisco yesterday called on Justice Elena Kagan, who fields petitions arising in the U.S. Court of Appeals for the Ninth Circuit, to freeze a lower court order that blocked a streamlined water permitting process for new pipelines. Read more from Ellen M. Gilmer.

Clean Energy Job Losses Persist But Layoffs Slow: U.S. clean energy job losses continued rising in May, with 620,590 jobs lost since the start of the coronavirus pandemic, though the pace of layoffs slowed considerably, according to an analysis of federal labor data released yesterday. Clean energy has been hard hit by economic shocks related to the pandemic on the heels of robust job growth in 2019, when sector employment totaled roughly 3.4 million. Read more from Dean Scott.

T-Mobile Outage to Be Probed by FCC: A T-Mobile service outage, which kept thousands of customers from making calls or using data yesterday, will be investigated by the Federal Communications Commission. “The T-Mobile network outage is unacceptable,” FCC Chairman Ajit Pai tweeted last night, saying that the agency would launch a probe into the matter. “We’re demanding answers — and so are American consumers.” Read more from Scott Moritz.

Defense & Foreign Affairs

Pyongyang Says It May Send Military to DMZ: North Korean state media said Kim Jong Un’s regime is reviewing a plan to send its army into the demilitarized zone splitting the nation from South Korea. Read more from Bill Faries.

U.S., China Allow More Flights: The Transportation Department is amending its order to allow Chinese air carriers to fly four weekly flights between China and the U.S., Alan Levin reports. The amendment is in response to China approving U.S. carriers to fly four weekly flights to China, the DOT said in a statement.

U.S. to Allow Work With Huawei on Standards: The Commerce Department announced a rule allowing U.S. companies to work together with Huawei on standards settings for next generation 5G networks. Under the rule, technology can be disclosed to Huawei “for the purpose of standards development in a standards-development body without need for an export license” as if Huawei was not on the U.S. blacklist, according to a statement, Caitlin Webber reports.

Pentagon Cybersecurity Weaknesses Persist, Audits Find: The Defense Department “continues to face significant challenges in managing cybersecurity risks to its systems and networks” despite many improvements made over the last year, an inspector general summary found, Tony Capaccio reports.

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