Pelosi’s announcement comes amid growing clashes between congressional Democrats and the Trump administration about oversight of the new rescue legislation and a $500 billion fund controlled by the Treasury Department. President Trump has to appoint a new inspector general to oversee that fund but has already signaled opposition to the scope of that person’s mandate.
Pelosi told reporters on a conference call that her new committee would be modeled after the World War II-era committee run by then-Sen. Harry Truman (D-Mo.), whose role in investigating the implementation of billions of dollars in defense contracts eventually led to his elevation to vice president.
She said that this new committee needed to serve as an everyday watchdog of the more than $2 trillion already allocated to fight the novel coronavirus and the virtual lockdown it has placed on the economy.
Without specifically mentioning Pelosi or her new committee, President Trump bristled Thursday at the prospect of additional congressional investigations. "This is not the time for politics, endless partisan investigations. Here we go again. ... It’s a witch hunt after a witch hunt,” Trump said at the daily briefing of his coronavirus task force.
Speaking at the same briefing, Treasury Secretary Steven Mnuchin said he viewed the new committee as unnecessary, given layers of oversight already built into the rescue legislation.
“Both parties wanted us to have oversight, wanted us to have transparency. We have full transparency,” Mnuchin said.
The House Select Committee on the Coronavirus, as Pelosi called it, will be chaired by Rep. James E. Clyburn (D-S.C.), who is the No. 3 Democratic leader as majority whip. No further details were provided about how many lawmakers would serve on the panel.
In a statement, Clyburn said “we cannot let the assistance directed toward addressing this crisis accrue in an unequitable fashion.”
Democrats have alleged that the White House and Republicans are prioritizing assistance for businesses over households, and Clyburn said his committee would be scrutinizing this dynamic closely.
The new oversight committee is being created in addition to several other oversight mechanisms, which were established as part of the $2 trillion coronavirus spending law that was enacted on Friday. But some Democrats are already expressing concern that Trump could try to circumvent oversight for his administration’s decisions.
The law established a new special inspector general to oversee the Treasury fund, the separate commission appointed by Congress also empowered to monitor that fund, and a Pandemic Response Accountability Committee, comprised of existing inspectors general from multiple agencies, to oversee the entire federal response to the coronavirus.
Republicans voiced immediate skepticism about Pelosi’s move to stand up a new select committee.
“This seems really redundant,” House Minority Leader Kevin McCarthy (R-Calif.) told reporters on a call following Pelosi’s announcement.
McCarthy also expressed “concerns” about how the committee would be created since the House is on a long recess and no one knows when they are coming back given health concerns from the coronavirus. Several lawmakers have tested positive.
Pelosi said the new committee will have the full investigative authorities of any congressional oversight committee. “It’s no use having a committee unless you have subpoena power,” she said.
Since Democrats took control of the House in January 2019, Trump and his administration have repeatedly ignored House subpoenas related to the Mueller report, the Ukraine investigation and other issues, forcing Democrats to ask the courts to compel former and current administration officials to comply.
The select committee would supplement oversight mechanisms that Democrats pushed to include in the $2 trillion rescue package signed into law on Friday. Some experts are already questioning how effective those mechanisms can be.
Democrats have already called on Trump to quickly nominate a new inspector general tasked with overseeing how Treasury makes loans and loan guarantees as part of the $500 billion program. This process could take months, though, as the person must be nominated by the White House and confirmed by the Senate, which is not in session because of coronavirus fears.
Trump has already suggested he may try to block one of the inspector general’s most important tools: the ability to alert Congress if the executive branch is denying requests for information.
“There’s a bunch of oversight provisions [in last week’s $2 trillion law], and they are not as muscular as one might want,” said Adam J. Levitin, a professor at Georgetown University Law who played a key oversight role during the financial crisis bailout programs of 2008, and also consulted with Democrats on the oversight language in the new bill.
As Congress and the Trump administration negotiated the vast rescue bill, one comment from Trump unnerved Democrats perhaps more than any other, when he told reporters: “I’ll be the oversight.”
“Democrats were never going to let President Trump be the oversight,” said Senate Minority Leader Charles E. Schumer (D-N.Y.). “It’s why we put in multiple layers of robust oversight, accountability and transparency, and we’re going to do everything we can to see that they are enforced.”
But with just days to cobble together an enormous relief package, lawmakers modeled three new oversight mechanisms off programs they had used in the past. This included the creation of a new inspector general, which was also created to monitor the $700 billion Troubled Asset Relief Program during the 2008 financial crisis, and a congressionally appointed commission to monitor the program and produce monthly reports.
A third oversight piece — a Pandemic Response Accountability Committee, comprised of existing inspectors general from multiple agencies — will oversee the entire federal response to the coronavirus, including but not limited to the federal spending under the three pieces of coronavirus legislation enacted so far, and with a mandate to examine any future legislation.
Republicans and the Trump administration agreed to the provisions, although at lower funding levels than Democrats sought. In the case of the oversight of the Treasury fund, the provisions were among the last items agreed to as Schumer, Mnuchin and Majority Leader Mitch McConnell (R-Ky.) exchanged offers during late nights at the Capitol last week.
Democrats also wrote in provisions requiring swift public disclosure of loans and prohibitions on loans going to any Trump organization business.
“We were fighting for major guardrails including limits involving the Trump family, so if you ask me about how we went from virtually nothing to what we got, I would tell you I think there was real progress,” said Sen. Ron Wyden (D-Ore.), top Democrat on the Finance Committee. “There’s obviously a lot more to do.”
The limits of the oversight mechanism in the legislation became apparent as soon as Trump signed it into law, when he issued a signing statement disputing the authority of the new inspector general to notify Congress if the executive branch was not providing requested information. Trump suggested he would not necessarily allow such notifications to occur. The signing statement also disputed a requirement for members of the Pandemic Response Accountability Committee to consult with Congress before hiring staff.
Neil M. Barofsky, who served as the first inspector general for TARP, said that for him, it was crucial to have the ability to notify Congress when an executive branch agency was failing to cooperate with a request for information. Such a notification — or more often, the threat of one — was the one real tool he had to force Treasury Department officials or others to produce information they were reluctant to divulge.
If Trump follows through on his signing statement and blocks the special inspector general from notifying Congress of resistance from the executive branch, “that potentially will hamstring the ability of the IG to be effective,” Barofsky said.
“If they have no recourse … that could be very problematic,” he said.
Pelosi’s decision to create a special congressional committee will give lawmakers more access to information, as well as subpoena powers if they believe the White House isn’t being forthcoming with key details.
The experience of TARP also made clear the importance of who was in key roles. Barofsky had an outspoken and activist approach, as did the chair of TARP’s version of the Congressional Oversight Commission, Elizabeth Warren. Warren was tapped for the panel by then-Senate Democratic Leader Harry M. Reid (Nev.), and was elected by fellow members to chair it. The structure of the coronavirus Congressional Oversight Commission, however, is slightly different. It is supposed to have five members, one each chosen by the top four congressional leaders of each party; and will be chaired by a fifth member selected jointly by McConnell and Pelosi. It may be difficult for the two of them to agree on a selection, and then it might not be a person who is outspoken in either direction.
“There are a lot of things the administration could do to try to frustrate oversight, starting with the special IG for pandemic recovery efforts,” said Levitin, who had served as special counsel to Warren’s oversight panel. “Will the president put forth a nomination? How fast will he act? And will he put forward someone who is likely to take a close look at things or twiddle his or her thumbs?”
The administration has not said when or if Trump will nominate someone for the job, and who that person might be.
A senior administration official said Trump is deeply skeptical of inspectors general and saw the move to add the provision to the relief package as a way to undercut or hurt him and his administration. He believes the inspector general could look for ways to criticize him and work with the Democrats, said the official, who spoke on the condition of anonymity to describe the president’s views.
The special inspector general for TARP is still in action more than a decade later, with an annual budget of more than $20 million and around 85 employees, said Christy Goldsmith Romero, the person who is now in that role. The agency continues to conduct audits and prosecutions and last year recovered nearly $900 million.
“Overall, during a crisis situation having a special IG at least for TARP helped gain the confidence of the American people and the markets, which was super important,” Romero said.
However, the special inspector general for the coronavirus response does not have such an open-ended mandate: The office will terminate five years after enactment of the law.
Josh Dawsey and Felicia Sonmez contributed to this report.