Bloomberg Government subscribers get the stories like this first. Act now and gain unlimited access to everything you need to know. Learn more.
The success of a massive stimulus package set for House passage today will depend on how quickly the aid can get to beleaguered consumers and businesses — a huge challenge for federal and state agencies that aren’t built to move quickly.
Congress has moved at a remarkable pace for such an enormous piece of legislation. The Senate unanimously approved the $2 trillion package of loans, aid and payments Wednesday night, and the House is expected to quickly pass the bill today.
“We’ll have a strong bipartisan vote and hopefully by noon be finished,” Speaker Nancy Pelosi (D-Calif.) said in an interview yesterday on Bloomberg Television. That will send the bill to President Donald Trump for his signature.
Then the hard work begins. Government institutions, especially the Treasury, will be asked to deliver enormous amounts of aid, racing against skyrocketing jobless claims.
Investors reacted positively to the action in the Senate, even with yesterday’s report that 3.28 million Americans filed for unemployment last week. The S&P 500 closed near session highs yesterday, posting its first three-day rally since February. The Dow Jones Industrial Average saw its biggest three-day gain since 1931 — and is now 21% above its March 23 trough.
Douglas Holtz-Eakin, who was on President George W. Bush’s economic team during the 2001 recession, said he’s “cautiously optimistic” about the impact of the coronavirus package, but it probably won’t prevent a dramatic drop in the economy.
“I hope it works. It’s designed sensibly on paper. Now we have to get the money out the door,” Holtz-Eakin said. Even still, “we’re probably going to have a second quarter growth rate that is double-digit negative.” Read more from Billy House, Mike Dorning and Steven T. Dennis.
Read the BGOV Bill Summary on the Senate-passed emergency funding measure (H.R. 748) here.
Also Happening on the Hill
Virus Voting Protocol Memo: The House sergeant at arms sent members a list of precautionary measures and rules that they should observe if they have to be present in the Capitol building to vote today. Such instructions include avoiding riding in elevators together and using hand sanitizer before entering and leaving the chamber. House leaders say they’d like to pass the Senate bill swiftly with a voice vote, which would not require members to be on the House floor. But any lawmaker could block that process and demand a recorded vote.
Sergeant at Arms Paul Irving said he recommends members of the 435-seat chamber who are physically present to arrive to vote in staggered, 30-member groups, by alphabetical order. The memo says that during debate on the bill, access to the House floor will be limited to those who are scheduled to speak. Unless participating in the debate, the lawmakers are encouraged to “refrain from grouping” and to stay in their offices until the voting begins. Read more from Billy House.
Fourth Bill for Health Workers: Lawmakers haven’t yet cleared their $2 trillion stimulus package but are already eyeing a fourth coronavirus measure that may include more funds for frontline health-care workers, congressional leaders and advocates said. Pelosi on Bloomberg TV said the next coronavirus bill would “lean toward recovery” and look to cover health-care services beyond testing for people who have contracted the illness. “It’s not just the tests, it’s the doctor’s visits,” Pelosi said.
Within her caucus there’s also a demand for expanding federal enforcement of safety rules for health-care providers and building on Obamacare to lower what Americans pay for health care. For Republicans, a fourth stimulus package could amount to aid to rural health providers. Some hospital and health-care provider groups have already signaled they are going to need more than the $100 billion included in the bill set to pass the House today. Both the House and Senate are expected to go on recess until late April after this week.
“With all the uncertainty surrounding this, it’s hard to put a firm figure on what more we need,” according to Carlos Jackson, vice president of legislative affairs for American’s Essential Hospitals. “But it’s clear that we’ll need more, given the projections we see,” Jackson said. “A better understanding of how this will flow to our hospitals.”
Vice President Mike Pence said the administration was open to a fourth bill to support states.
“Already we’re hearing from some governors about the need for additional resources, and we will evaluate those very carefully,” Pence said at the White House’s press conference yesterday. “I think the secretary of the Treasury’s already indicated and congressional leadership has already indicated a willingness to remain open to that.”
Pelosi also said she’ll push to rescue financially strapped union pension plans that serve over one million workers or retirees in several industries in the next package. Democrats unsuccessfully tried to insert a House-passed effort to lend money to multi-employer pension funds into the coronavirus relief package negotiated with the White House and Senate leaders, Pelosi said. James Rowley has more.
Economic Efforts & Industry Pains
Lawmakers Ask for Tariff Deferral: House Minority Leader Kevin McCarthy (R-Calif.) and Sen. Dianne Feinstein (D-Calif.) are among lawmakers who signed a letter yesterday to the Trump administration seeking deferral of at least 90 days on all tariffs amid the coronavirus outbreak.
Mnuchin Wants Markets Open: Treasury Secretary Steven Mnuchin reiterated yesterday on a call with financial regulators that he wants U.S. financial markets to remain open even as the coronavirus fuels wild volatility, while adding that he’s focused on helping mortgage firms expected to be hit hard by the pandemic’s spreading economic pain. The past two weeks of huge market swings have fueled rumors across Wall Street that the government could halt trading. Last week Mnuchin added to the speculation by saying that while the Trump administration plans to keep markets open it could shorten trading hours Read more from Ben Bain and Saleha Mohsin.
Pennsylvania Had Far More Jobless Claims: Of the 3.3 million Americans who applied for unemployment last week amid coronavirus shutdowns, the biggest share by far came from Pennsylvania, the fifth-largest state, but it may be just a sign that many more filings are to come. It’s unclear if there was one overriding reason for the disparity, but there are several plausible explanations: the state’s governor shut down business before other states, officials made it easier for its residents to apply for benefits, and administrators simply might be processing claims faster. Read more from Reade Pickert.
- Meanwhile, Trump yesterday argued that U.S. unemployment claims would have been even worse if he hadn’t restricted travel from China in January to try to curb the coronavirus outbreak. “It’s nobody’s fault, certainly not in this country,” Trump said at the White House. “We got very lucky,” he said, again complimenting himself for his Jan. 31 decision to restrict travel from China, where the outbreak began. The unemployment numbers, he said, would’ve been “far greater, far bigger.” Read more from Alex Wayne.
Trump Attaches Strings to Cruise Loans: Trump said cruise companies should consider changing their official homes to the U.S. if they intend to get federal loans. Trump has been saying for several days that cruise lines would likely be beneficiaries of the Senate-passed stimulus deal. But the version passed by the Senate excludes companies that aren’t domiciled in the U.S. or whose staffers are mostly outside the country. Trump said there were senators who opposed including cruise lines for such reasons. “I do like the concept of perhaps coming and registering here,” Trump said. “It’s very tough to make a loan to a company when they’re based in a different country.” Read more from Christopher Palmeri.
American Airlines ‘Grateful’ for Help: American Airlines, the largest air carrier in the world, said it’s “deeply grateful” for a government lifeline under the as-yet pending stimulus package as the pandemic batters travel demand. While final conditions to tap cash assistance and loans remain unclear, American “will be engaged as the process unfolds quickly from here,” its chief executive, Doug Parker, and president, Robert Isom, wrote in a memo to employees. Read more from Mary Schlangenstein.
Research, Treatment & Equipment
U.S. Cases Surpass China: The U.S. surpassed China as having the most confirmed cases in the world, Johns Hopkins data show. Infections in America as of yesterday afternoon had topped 82,400, compared with 81,782 in China where the outbreak began three months ago. The American tally was bolstered by a major jump in New York, which had 6,448 new cases yesterday, bringing the state’s total to 37,258. That accounts for almost half the outbreak nationwide, according to data collected by Bloomberg. Read developments here.
Worst-Case Scenario Not Materializing: Worst-case projections for the spread of coronavirus aren’t supported by evidence emerging from outbreaks in China, South Korea, and Italy, said Deborah Birx, the immunologist advising Vice President Mike Pence. “There’s enough data now of the real experience with the coronavirus on the ground to really make these predictions much more sound,” Birx said at a White House press conference yesterday. Read more from Jordan Fabian, Josh Wingrove and Mario Parker.
Trump to Send Off Navy Ship: Trump said he plans to travel to Norfolk, Va., tomorrow to see off the USNS Comfort, a Navy hospital ship that is sailing to New York City to help with the coronavirus crisis there. Trump, speaking at the White House yesterday, said the ship will arrive in New York Monday, a few weeks ahead of the original estimate. “I think I’m going to go out and kiss it goodbye,” Trump said. “I will go and we’ll be waving together.” Secretary of Defense Mark Esper said last week the ship would set sail in early April after undergoing some maintenance. Read more from Mario Parker.
Trump, Xi Vow Virus Cooperation: Trump and China’s Xi Jinping pledged in a phone call to cooperate in the fight against the coronavirus pandemic, signaling a fresh detente between the two countries after weeks of rising tensions. “Just finished a very good conversation with President Xi of China. Discussed in great detail the CoronaVirus that is ravaging large parts of our Planet,” Trump tweeted last night. “China has been through much & has developed a strong understanding of the Virus. We are working closely together. Much respect!”
Trump notably refrained from referring to the disease as the “Chinese virus,” days after he told Fox News he would stop using the term. Xi, meanwhile, told Trump that relations between the two sides were at a “critical moment” and vowed to cooperate to defeat the deadly illness, according to China’s official Xinhua News Agency. Read more from Karen Leigh.
G-20 Said to have Discussed Data Sharing: Trump said leaders from the Group of 20 nations discussed the importance of sharing data and information during the coronavirus pandemic, as the U.S. surpassed China in the number of publicly reported cases. The president said the leaders discussed “how vitally important it is for all of our nations to immediately share information and data” during a video conference earlier yesterday chaired by Saudi Arabia, which is hosting the G-20 this year. Read more from Jihye Lee and Vivian Nereim.
U.S. to Give Nations $174 Million for Virus Aid: The Trump administration announced $174 million in additional aid to help countries most at risk from the coronavirus pandemic but made clear the assistance won’t include protective equipment that U.S. hospitals have struggled to obtain. The new money is $110 million for international disaster assistance and $64 million going to the United Nations High Commissioner for Refugees, Secretary of State Michael Pompeo said in a statement yesterday. That’s in addition to $100 million in aid that he announced as the coronavirus spread around the globe in recent weeks. Read more from Nick Wadhams.
How to Ration Scarce Ventilators: New Jersey will ask medical experts on a bioethics panel to set guidelines for which Covid-19 patients will get ventilators, wrenching decisions that could determine who lives and who dies. New Jersey’s medical society and the state’s former epidemiologist will consider the question, State Health Commissioner Judith Persichilli told reporters in Trenton yesterday, calling it “one of the more difficult issues that we will be discussing.” Confirmed infections are rising rapidly in New Jersey. Officials reported a 56% jump in new cases, to almost 7,000, yesterday. Elise Young and David Voreacos have more.
Wider Actions & Societal Impacts
Should We Shake Hands Ever Again?: Trump suggested that Americans should consider scrapping the tradition of handshakes—forever. Trump said Americans shouldn’t entirely abandon social-distancing practices when the pandemic ends, like shaking hands. “Maybe, people aren’t going to be shaking hands anymore,” Trump said, adding that he discussed the practice with Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases. “He was saying the regular flu would be cut down by quite a bit if we didn’t do that,” Trump said at the conference, Alex Wayne reports.
U.S. Floats Troops on Canada Border: The Canadian government is urging the U.S. not to dispatch troops to its northern border, as Trump’s White House looks to ramp up security to slow the spread of the coronavirus. Prime Minister Justin Trudeau and Deputy Prime Minister Chrystia Freeland said that the U.S. is considering sending the military to block any illegal migrants after the countries agreed to travel restrictions aimed at halting the contagion. Canada and the U.S. “have the longest, unmilitarized border in the world, and it is very much in both of our interests for it to remain that way,” Trudeau said, Josh Wingrove reports.
Dow Jones later reported the Trump administration dropped its consideration of plans to send military forces to the border border, citing a U.S. official.
U.S. Trial Courts Cope with Covid-19: Federal district courts are slowing the wheels of justice in historic ways as they grapple with sick employees and other fallout from the coronavirus pandemic. District, or trial, courts make up the bulk of the federal judiciary and are uniformly on the front lines for both criminal and civil cases. A Bloomberg Law analysis of orders and court websites shows that despite their decentralized nature and freedom to formulate their own responses, the majority of the nation’s 94 U.S. district courts are taking similar steps to address the swiftly unfolding crisis. Read more from Madison Alder.
Meanwhile, the coronavirus pandemic has put on indefinite hold a major portion of the U.S. Supreme Court’s docket, including a multibillion-dollar clash between software giants Google and Oracle and cases that could affect Trump’s re-election chances. What was supposed to have been a drama-filled spring at the high court has instead become a season of waiting, especially for the lawyers and litigants in 20 arguments that had been scheduled for March and April. The court has postponed 11 of those cases and could do the same soon for the remaining nine. Read more from Greg Stohr.
School Testing Waived in Most States: Most states have taken advantage of a streamlined process for seeking federal school testing waivers as they navigate classroom closures stemming from the coronavirus pandemic. Forty-five states have won initial Education Department approval to do away with standardized tests in the 2019-2020 academic year, a spokeswoman for the department said yesterday. Read more from Andrew Kreighbaum.
EPA Backs Off On Pollution Rules: The Trump administration will temporarily relax civil enforcement of various environmental regulations, a move it says is necessary given worker shortages and travel restrictions related to the coronavirus pandemic. In a memo issued Thursday, the Environmental Protection Agency said it wouldn’t go after companies that fail to satisfy many “routine monitoring and reporting obligations” because of the coronavirus, as long as they documented why they couldn’t fulfill the mandates, worked to resolve the issues, and sought to minimize the effects. Read more from Jennifer Dlouhy.
What Else to Know
Trump’s Sprint to Relax Regulations Must Clear Virus Hurdles: The Trump administration is racing against the clock to lock in pieces of the president’s first-term deregulation agenda before an obscure law makes it easier for congressional foes to reverse his policies. Regulators are rushing to finish work as soon as next week on some top Trump initiatives, including relaxing fuel economy standards for vehicles and eliminating the legal basis for restricting mercury pollution from coal-fired power plants. The haste is necessary to prevent the measures from being killed by Congress next year if Trump loses re-election and Democrats retake the Senate.
The effort has been complicated by the coronavirus, which has strained government resources, distracted policy makers and created a public-relations risk to any measures not connected to the global pandemic. Read more from Jennifer A. Dlouhy, Amena Saiyid and Susan Decker.
Trump Promises GOP Convention Will Be Held This August: Trump said that the Republican National Convention would go forward as planned this August even as the coronavirus has caused the cancellation of large-scale events all across the U.S. Democrats are scheduled to hold their convention in Milwaukee from July 13-16. The Republican convention is to be held from Aug. 24-27, and the president told Sean Hannity on Fox News last night that “We’re quite a bit later than them, which I think is good.” Trump said there was “no way” he would cancel the convention. “It’s going to be incredible.” Read more from John Harney and Mario Parker.
United Technologies’ Raytheon Deal Wins U.S. Antitrust Approval: United Technologies won U.S. antitrust approval for its acquisition of Raytheon, a deal that will create an aerospace and defense giant. The Justice Department’s antitrust division signed off on the deal after the companies agreed to sell assets to resolve competition concerns stemming from the tie-up, according to court papers filed yesterday in Washington.
United Technologies said it expects the deal to close early in the second quarter, David McLaughlin reports.
Raytheon also reached a five-year, $1 billion deal to buy propulsion systems from Aerojet Rocketdyne for Standard Missiles contracts, Vishal Persaud reports.
Trump Likely Too Late to Calm Oil Markets: When Saudi Arabia kicked off its oil-price war and triggered the worst crude crash in a generation, Trump lauded the ensuing decline in pump prices. But now with thousands of oil jobs hanging in the balance and the U.S. shale industry in upheaval, any action by Trump himself may be too little, too late. Oil’s downturn has rapidly devolved from a simple case of too much supply to a worst-case scenario of total demand destruction — a problem far harder to solve from the Oval Office. Read more from Stephen Cunningham, Jennifer A. Dlouhy and Nick Wadhams.
Anthem Sued for Medicaid Fraud: Anthem overcharged the U.S. government by millions of dollars for services provided to Medicare patients, according to a fraud lawsuit filed by prosecutors. The U.S. Attorney’s office in Manhattan alleges that the medical insurance giant jacked up its Medicare reimbursement by submitting inaccurate diagnostic data for hundreds of thousands of patients covered by Medicare Plan C. Read more from Robert Burnson.
E-Cigarette Rule Delay Requested: Altria sent a letter to the FDA yesterday asking that a crucial regulatory deadline for some tobacco products be pushed back by eight weeks due to complications caused by the coronavirus pandemic. Currently, companies must apply to the FDA by May 12 for authorization to keep selling certain tobacco products. Regulators, public-health groups and companies fought over the timing for years before settling on that date last year in federal court. The deadline applies to products such as e-cigarettes and nicotine pouches. Read more from Angelica LaVito.