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At The White House
TRUMP SKIRTS BAILOUT QUESTION: President Trump declined to publicly commit that money from the massive coronavirus stimulus bill would not go to his privately-owned properties. This raises fresh questions about how the first president in modern American history not to divest from his business interests could benefit from federal funds.
- “Let’s just see what happens,” Trump told our colleague Seung Min Kim at the the White House on Sunday, after complaining that no one thanked him for rejecting his presidential salary. “We have to save some of these great companies.”
- “I don’t know,” Trump told reporters Saturday when asked if his business would accept stimulus money. “I just don’t know what the government assistance would be for what I have. I have hotels. Everybody knew I had hotels when I got elected. They knew I was a successful person when I got elected, so it’s one of those things.”
Trump's dodge came after Senate Democrats blocked the $1.8 trillion emergency stimulus package from moving forward over concerns that the bill “is tilted too far in favor of corporations and doesn't include much oversight for $500 billion in loans and guarantees that could go to firms selected by the Treasury Department,” our colleagues on Capitol Hill report. They point out, “Trump has already talked about how he wants to help the cruise industry and the hotel industry.”
- Trump's businesses may prove a sticking point in negotiations: “One of the things [Senate Minority Leader Chuck] Schumer and Democrats have been fighting for is to ensure that the president can’t use Treasury Secretary [Steven] Mnuchin’s slush fund to steer money toward any government official or their family members,” a senior Democratic aide familiar with the negotiations told Power Up.
- Yet a Republican Senate aide told us that concerns over Trump being a beneficiary of the bailout are not “serious”: “Trump’s marginal benefit isn’t really a concern when you’re dealing with a two trillion dollar package attempting to save the global economy from collapse.”
From Fahrenthold's notebook: David Fahrenthold, who covers the Trump family and its business interests, tells Power Up that "the virus-related shutdowns could become the biggest challenge to face Trump’s private company since his famous financial crash of the early 1990s.”
- “If Trump’s company receives a bailout from Trump’s government, that would represent an unprecedented use of public money to help a sitting president’s private interests," David tells us.
- More: “It could also raise questions about constitutionality: The Constitution prohibits presidents from taking any federal payments beyond their appointed salary.”
The former director of the U.S. Office of Government Ethics, Walter Shaub, tweeted that the massive economic package must include “built-in oversight” of Trump:
Trump just REFUSED to promise Trump Org won't receive money from the bailout.— Walter Shaub (@waltshaub) March 22, 2020
But Trump Org receiving money would VIOLATE the Constitution. It would be an illegal emolument.
Congress MUST explicitly ban Trump Org from getting ANY money AND must include other built-in oversight. https://t.co/4wuKISxIRA
Trump's family business is already taking a hit. David provided us with a picture of Trump's personal financial interests as the Senate negotiates what would be the largest financial rescue ever attempted in the U.S.
- “For Trump’s private business — which the president still owns — the coronavirus appears to have caused widespread loss of income. His hotels in Las Vegas, Miami, Ireland and Turnberry, Scotland have all shut down, as has his Mar-a-Lago Club in Florida and his Bedminster golf club in New Jersey,” David wrote us in an email last night. “Trump says his company is now run day-to-day by his sons Eric and Don Jr. The company has not responded to questions asking if they will seek a bailout.”
- “Other Trump hotels remain open, but with sharply diminished business: in Washington, for instance, the union representing Trump hotel workers said the hotel has an occupancy rate around 5 percent. In Washington, Chicago, and Las Vegas, Trump’s company has already laid off workers.”
- Trump himself acknowledged coronavirus was hurting the Trump Organization: “I wouldn’t say it’s thriving when you decide to close down your hotels and your businesses,” he said Saturday. “Yeah it’s hurting me, and it’s hurting… all of the great hotel chains all over the world.”
MORE ON THE BILL: “The Treasury Department would have broad discretion over who receives the money. There is little precedent for a program with a similar size and scope,” per Erica Werner, Seung Min Kim, Rachael Bade, and Jeff Stein.
- “The bill also would require disclosure of the loan recipients within only six months of enactment. Trump administration officials have said they are interested in providing federal assistance to help the cruise, hospitality and oil and gas industries, among others severely hurt by the downturn since the beginning of the outbreak,” according to Jeff.
- Talking points: “In the midst of an unprecedented national crisis, Republicans can’t seriously expect us to tell people in our communities who are suffering that we shortchanged hospitals, students, workers and small businesses, but gave big corporations hundreds of billions of dollars in a secretive slush fund,” Sen. Patty Murray (D-Wash.) told the New York Times's Emily Cochrane, Jim Tankersley and Jeanna Smialek.
Some experts, however, dismissed such concerns. Tony Fratto, a former Treasury and White House official for George W. Bush told our colleague Jeff that there's a key distinction between now and the 2008 financial crisis — when Congress determined which firms should receive taxpayer assistance. Wall Street banks received bailout money after playing a role in creating the economic crisis, Jeff writes, while “businesses shuttered by the coronavirus through no fault of their own.”
- “All of this is going to be public; there is nothing to hide here, and no public interest served in reporting it immediately,” Fratto said. “We are not talking about companies that did something wrong. We are dealing with companies with orders to shut down their business.”
- And: “The Treasury Department has an inspector general who could probe the administration’s handling of the loans, and companies have a legitimate interest in keeping from their competitors immediate information on whether they have received the aid, said [Fratto],” Jeff writes.
On The Hill
SENATE EXPECTED TO VOTE THIS AFTERNOON: Senate Democrats also blocked a Republican-led effort to hold a re-do vote on the stimulus package just 15 minutes after markets were set to begin trading this morning. That means traders could be in for a nervous few hours as both sides scrambled to resume talks to revive the $1.8 trillion bill, per Erica, Seung Min, Rachael Bade and Jeff.
- Mnuchin expressed optimism: “I think we’re very close. The teams are going to work through the night. We’re going to regroup the principals in the morning.” the secretary told reporters. “[He] played shuttle diplomacy all afternoon and night, exiting the Capitol just before midnight after his sixth face-to-face meeting with [Schumer.]”
- Mitch McConnell left the Capitol visibly angry, per our colleagues: The Senate majority leader said on the floor late last night that there was bipartisan agreement “until the Democratic leader and the Speaker of the House decided to blow it all up and play Russian roulette with the markets.”
What happens if there's no deal: Later this afternoon, “a series of votes will unfold that are like to be a replay of Sunday’s blocked path, except this time the U.S. financial markets will be open and trading,” our colleagues write. The Senate failed to advance the package on a 47-47 vote, well short of the 60 votes needed to move forward.
The bill, as it currently stands, includes:
- Around $250 billion in direct checks for Americans, $1,200 per qualifying adult and $500 per child. The cash disbursements now phase out for people with incomes starting at $75,000 and above.
- Around $350 billion for small businesses, an area with apparent broad bipartisan support
- $100 billion for hospitals and about $250 billion to beef up state unemployment insurance programs — both major priorities for Democrats.
Mnuchin said the historically large package is designed to last 10-12 weeks, after which the administration would revisit the need for any additional action.
THE MARKETS ARE BRACING FOR ANOTHER ROUGH DAY: “As of 5:30 a.m. ET, Dow Jones Industrial Average futures pointed to a Monday opening loss of more than 600 points. S&P 500 and Nasdaq 100 futures also pointed to sharp losses,” CNBC's Fred Imbert reports.
PAUL TESTS POSITIVE: “Rand Paul (R-Ky.) has become the first senator to test positive for the novel coronavirus,” our colleagues Felicia Sonmez, Seung Min Kim and Paul Kane report.
- More details on the senator's condition: “Paul’s office added that the senator ‘expects to be back in the Senate after his quarantine period ends’ and that ‘virtually no staff’ have had contact with him since Paul’s Washington office began operating remotely 10 days ago,” our colleagues write.
- Paul is the third member of Congress to test positive for the virus: “Last week, Reps. Mario Diaz-Balart (R-Fla.) and Ben McAdams (D-Utah) announced they had tested positive.”
News of the diagnosis sparked concern on the Hill: “There’s no doubt, I’m sure, that there are members, our members, who have had contact with him,” Sen. John Thune (R-S.D.) said of Paul. “That’s why I think we have to get this [relief package] done quickly.”
- Paul was spotted working out Sunday morning: “Jerry Moran (R-Kan.) told fellow senators that Paul was working out in the Senate gym Sunday morning. Moran also said Paul was swimming in the pool,” our colleagues write.
Sen. Kyrsten Sinema (D-Ariz.) lit into Paul for his behavior:
I’ve never commented about a fellow Senator’s choices/actions. Never once.— Kyrsten Sinema (@kyrstensinema) March 22, 2020
This, America, is absolutely irresponsible. You cannot be near other people while waiting for coronavirus test results. It endangers others & likely increases the spread of the virus. https://t.co/651TJf8mWf
Paul's condition prompted Utah Sens. Mike Lee and Mitt Romney to self-quarantine based on the advice of the Capitol's attending physician, as both Republicans had recent contact with him.
- No vote for Utah: That means no senator from Utah will be able to vote on the relief package as self-quarantining includes the recommendation that neither senator vote on the floor. McConnell and House Speaker Nancy Pelosi have previously waved off any suggestion that their members should be able to vote remotely.
Trump's reaction: The president said on Twitter his “friend” Paul is “strong and will get better.” As for Romney, the one Republican senator who voted to convict Trump on the charge of abuse of power, Trump said: “Romney’s in isolation? Gee. That’s too bad.”
- Asked whether there was sarcasm in his remarks, Trump responded, “No. None whatsoever.”
- Romney, our colleague Paul Kane pointed out, is fearful of contracting the virus and passing it on to his wife Ann, who has multiple sclerosis.
Outside the Beltway
MAYORS AND GOVERNORS SLAM FEDERAL RESPONSE: “The growing gulf between the White House and officials on the front lines of the pandemic underscored concerns in cities, states and Congress that Trump does not have a coherent or ready plan [to confront the crisis]," our colleagues Robert Costa and Aaron Gregg report.
The president slammed Illinois Gov. J.B. Pritzker (D) earlier in the day, but changed his tone in the evening: 'The governors, locally, are going to be in command,” Trump told reporters, as he pledged support from the National Guard and federal agencies. “We will be following them, and we hope they can do the job. And I think they will.”
- Key quote: “We’re all building the airplane as we fly it right now,” Michigan Gov. Gretchen Whitmer (D) said on ABC’s “This Week.” “It would be nice to have a national strategy.”
- Even some Republicans are expressing frustration: “We are getting some progress. Now, it’s not nearly enough. It’s not fast enough. We’re way behind the curve,” Maryland Gov. Larry Hogan (R) said on NBC’s “Meet the Press,” as he detailed how Maryland is scrambling to find supplies without any guarantees from the federal government. Hogan also chairs the National Governors Association.
Trump's very early tweet is sure to add to the speculation about what's next:
WE CANNOT LET THE CURE BE WORSE THAN THE PROBLEM ITSELF. AT THE END OF THE 15 DAY PERIOD, WE WILL MAKE A DECISION AS TO WHICH WAY WE WANT TO GO!— Donald J. Trump (@realDonaldTrump) March 23, 2020
Officials are frustrated by conflicting messages from the White House: Of particular concern to many governors is the Defense Production Act, "which would allow the government to order companies to ramp up the production of ventilators and protective masks, among other products," our colleagues write. But Federal Emergency Management Agency Administrator Peter T. Gaynor said Sunday that Trump had yet to invoke the law.
- New York Gov. Andrew Cuomo (D) urged Trump to nationalize some industries: “Currently, when states are doing it, we are competing against other states,” Cuomo said of buying the sorely needed gear for doctors like masks or gowns. Pritzker compared the situation to “the Wild West.”
- Last week, Trump said he would invoke the act. But then cautioned he would only use the powers under it “in a worst-case scenario”: “Behind the scenes, the Trump administration has activated only a very limited set of authorities under the law, including a provision that allows the government to jump the line when ordering from U.S. manufacturers," our colleague writes. "The more extreme provisions in the law — including authorities that could allow it to take control of private airplanes or use federal funds to get other industries involved — have not been announced."
NEW YORK REMAINS ON EDGE: “Nervous New Yorkers braced for their strange lives during the pandemic to get even stranger, with little more than the basic necessities available,” our colleagues Shayna Jacobs, Ben Guarino, Jada Yuan and Devlin Barrett report from New York.
- The state has become of the worst hot spots nationally for the virus: “To try to stave off the spread, New York is one of a handful of states that have taken the drastic step of ordering all nonessential business to shut down,” our colleagues write.
- Cuomo is in a race against time as he tries to ramp up the state's hospital capacity and supply of critical gear: “From my point of view, construction could start tomorrow,” he said of temporary hospital locations in Long Island, Westchester and Manhattan’s Javits Center, a giant convention hall. New York may need as many as 110,00 hospital beds. It currently has only 53,000.
New York accounts for nearly half of cases nationwide:
The situation in California isn't much better: “The region known as the heart of the tech industry is both inventing a new online reality and feeling the strains of economic inequality,” our colleagues Geoffrey A. Fowler, Reed Albergotti, Faiz Siddiqui report from San Francisco nearly a week into the order for the Bay Area's 6 million residents to stay at home.
- What it's like on the ground: “Tumbleweeds might as well have rolled across the Golden Gate Bridge during rush hour Friday, though cooped-up people filled nearby Crissy Field to exercise, mostly keeping a respectful distance,” our colleagues write.
INTERVIEW WITH FAUCI: Anthony Fauci, the now well-known director of National Institute of Allergy and Infectious Diseases, gave an candid interview to Science Magazine's Jon Cohen in which he joked about not being fired, discussed his relationship with the president and was asked about his face palm going, well, viral.
- Key quote: “I can't jump in front of the microphone and push him down. OK, he said it. Let's try and get it corrected for the next time,” Fauci said of the struggle to make sure Trump says things that are true.
- When asked how he's doing: “Well, I'm sort of exhausted. But other than that, I'm good. I mean, I'm not, to my knowledge, coronavirus infected,” Fauci said. “To my knowledge, I haven't been fired. [Laughs.]”
- On getting change within the White House: “Sometimes you have to say things 1,2,3,4 times, and then it happens. So I'm going to keep pushing,” Fauci said about Trump and other officials still shaking hands and doing things that do not comport with the coronavirus task force's recommendations.
- On whether he's been criticized for face-palming after Trump said “deep State Department" on Friday: ”No comment."
A FRANTIC SCRAMBLE IN EUROPE: “Soldiers in Germany, France and Spain have been deployed to help build similar temporary facilities for thousands of patients. Across Europe, tens of thousands of nurses and doctors are being graduated early or called back from retirement,” our colleagues Loveday Morris, William Booth and Luisa Beck report as countries do everything they can to avoid a situation similar to Italy.
- One expert's bleak outlook: “There’s been nothing on this scale in the postwar period,” Martin McKee, a professor of European public health at the London School of Hygiene and Tropical Medicine told our colleagues. “The problem is that health systems, we talk about them as adaptive, but they have the capacity to fall over. They can expand so much, but at some point the whole thing collapses.”
OFFICIALS CONCEDE OLYMPICS MIGHT BE POSTPONED: “Facing mounting pressure and growing criticism, Thomas Bach, the president of the International Olympic Committee, wrote a letter to Olympic athletes in which he said canceling the Summer Games altogether is not an option and vowed that a final decision on postponement would be made within the next four weeks,” our colleagues Rick Maese and Des Bieler report.
- Canada became the first country to refuse to participate in this summer's Olympics in Tokyo: “This is not solely about athlete health — it is about public health,” the Canadian Olympic Committee said in a statement, in which it called for a postponement. The announcement dealt the IOC “a devastating blow hours after the international governing body sought to assuage its growing detractors and critics with its message to athletes,” our colleagues write.