Trump suggests bailouts with strings
Coronavirus cases surpass 11,000 in U.S.
WASHINGTON — President Donald Trump said Thursday the government should take partial ownership of companies bailed out in the coronavirus pandemic and that treatments for covid-19 might be at hand. A travel warning was issued, and lawmakers worked to send Americans direct aid.
Trump sought to calm the public’s fears as the number of confirmed coronavirus cases in the U.S. climbed above 11,000, with at least 178 deaths. He said therapeutic drugs in early testing could be “a game-changer, and maybe not” in treating those suffering with covid-19, the disease caused by the virus.
But the head of the Food and Drug Administration cautioned that the drugs were still being tested for their effectiveness and safety, a process that takes months and may not yield anything.
Meanwhile, the State Department issued an alert warning Americans not to travel abroad under any circumstances and to return home if they are already outside the country, unless they plan to stay there.
“The Department of State advises U.S. citizens to avoid all international travel due to the global impact of covid-19,” it said in the new advice. “In countries where commercial departure options remain available, U.S. citizens who live in the United States should arrange for immediate return to the United States, unless they are prepared to remain abroad for an indefinite period. U.S. citizens who live abroad should avoid all in
ternational travel.”
Until the upgrade, the department’s advice to U.S. citizens was to “reconsider” all international travel under what is known as a “level three” alert. The global “level four” warning was unprecedented, as such alerts are generally reserved for specific countries embroiled in conflict, natural disasters or where Americans face specific risks.
AID IN WORKS
On Capitol Hill, lawmakers worked urgently to fashion an aid package that could top $1 trillion to prop up households and the U.S. economy, starting with a White House proposal to send Americans direct aid. Congress also is working to increase production of medical supplies and build temporary field hospitals under new authorities Trump invoked in the Defense Production Act.
Senate Majority Leader Mitch McConnell has tapped several Republican senators and their staff aides to hammer out the elements of what lawmakers have begun referring to as the “Phase 3” economic rescue plan. Earlier this month, Congress approved a first, $8.3 billion round of emergency money for federal health agencies, and this week it finalized a second measure — of which the cost has yet to be tallied — to provide paid leave, jobless aid and food and health care assistance, as well as free coronavirus testing. Trump has signed both.
A centerpiece of the “Phase 3” package is tax rebates of $1,200 to individuals and $2,400 for married couples. Rebates are completely phased out for taxpayers with incomes exceeding $99,000 for individuals or $198,000 for a couple.
The legislation also provides $208 billion worth of loans for businesses suffering because of the pandemic, including $58 billion for the airline sector and $150 billion for other distressed areas of the economy.
The aid would include a cap on salaries for executives at companies that get the money and a requirement that air service to certain destinations not be interrupted. It also caps severance pay for executives making more than $425,000 to twice their 2019 pay.
It permits the federal government to take an equity stake in companies that receive loan assistance, “contingent on the financial success of the eligible business.” Any gains collected from stakes in passenger or cargo airlines would be deposited in the Airport and Airway Trust Fund, and proceeds from other companies would go to the Treasury Department.
Trump called the battle against coronavirus a “medical war” not a “financial war.” But he said he believed the U.S. government should take equity stakes in some companies hard hit by the pandemic and aided by taxpayers. Some Republicans in Congress worry this could lead to the government picking winners and losers. It was not clear that Trump had made any firm decision to attach such strings.
“We will be helping the airline industry,” he said. “We will be helping the cruise ship industry. We probably will be helping the hotel industry.” He said the administration will also help small businesses, the “engine of the country.”
But he suggested that such federal aid should not be used by companies to buy back their stock, and he said he would support restrictions on executive bonuses and future buybacks from companies receiving the federal support.
SMALL-BUSINESS FOCUS
House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer said in a statement that they will demand that any compromise legislation put its emphasis on workers and small businesses. They called for a big boost in unemployment insurance and the Medicaid health insurance program for the poor and other ways of “putting money directly into the hands of those who need it most.”
James Lucier, senior political analyst at Capital Alpha Partners in Washington, estimated the plan would provide about $1.5 trillion in stimulus. It would provide “something to help the economy cope with the shock of an unprecedented event — it’s not designed to restore GDP to what it would have been, or to the stock market, or eliminate the damage.”
Sen. Marco Rubio of Florida, the Republican chairman of the Small Business and Entrepreneurship Committee, and Sen. Susan Collins, R-Maine, unveiled a $300 billion proposal to provide grants to small businesses with up to 500 employees to help them make payroll and other expenses retroactive to March 1.
Those businesses would get up to $10 million each to cover their payroll and other expenses, with the amount capped by their expenses in the previous year.
The proposal would provide cash-flow assistance structured as federally guaranteed loans to employers who pledge not to lay off their workers — potentially as much as the employer needs to stay in business for six weeks without layoffs. Those loans would be available during an emergency period ending June 30 and would be forgiven if the employer continued to pay their workers for the duration of the crisis.
The goal, Rubio wrote on Twitter on Thursday, was to “get cash to small business” as “fast & easy as possible so they don’t have to lay people off & if they use it for that purpose doesn’t have to be paid back.”
The legislation would require health insurers to provide coverage for coronavirus testing, and they generally would be barred from requiring co-payments or deductibles. It also would require that vaccines for covid-19 would be available without cost-sharing, if they’re recommended as effective by experts.
The legislation would also delay the tax filing deadline to July 15 after the IRS already delayed the tax payment to that date. The deadline for business owners and self-employed
individuals to pay their estimated quarterly taxes would be deferred until Oct. 15. The bill also delays corporate tax payments to Oct. 15.
McConnell said he would immediately engage in discussion with Democrats, whose votes will be needed in both the Senate and House to pass the legislation and get it to the president for his signature.
“These are urgent discussions,” McConnell said. “The Senate is not going anywhere until we take action.”
MEDICAL STRUGGLES
More than eight weeks after the first U.S. case of the virus was detected, the federal government is still struggling to conduct wide-scale testing. Compounding the problem, laboratories are reporting shortages of supplies needed to protect health care workers and ventilators that are used to treat respiratory symptoms of the virus.
For most people, covid-19 causes only mild or moderate symptoms, such as fever and cough. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia.
However, a Centers for Disease Control and Prevention analysis of U.S. cases from Feb. 12 to March 16 that was released Wednesday shows that 38% of those sick enough to be hospitalized were younger than 55.
The CDC report looked at 4,226 covid-19 cases, with much of the data coming from the outbreaks among older adults in assisted living. About 80% of people who died were 65 and older.
“These preliminary data also demonstrate that severe illness leading to hospitalization, including ICU admission and death, can occur in adults of any age with covid-19,” researchers wrote.
There was more encouraging news about children in the United States. Those 19 and younger who were tested appear to have milder illness with almost no hospitalizations.
The CDC report did not specify if the younger patients had underlying conditions that might make them more vulnerable, but Anthony Fauci, head of the National Institute on Allergy and Infectious Diseases, commented on a CNN show Wednesday night that some did.
Dr. Stephen Hahn, the Food and Drug Administration commissioner, described several approaches to treatment under testing. Among them: chloroquine, a drug long used to treat malaria; remdesivir, an experimental antiviral that’s being tried in at least five studies; and antibodies culled from the blood of covid-19 patients when they recover.
Chloroquine is widely available already and could be used off-label, but Hahn said officials want a formal study to get good information on whether it helps people with covid-19 and is safe. No new and imminent treatments were announced at the briefing.
“We’re looking at drugs that are already approved for other indications” as a potential bridge or stopgap until studies are completed on drugs under investigation, Hahn said.
Meanwhile, a temporary field hospital for use by people unable to isolate and recover from covid-19 in their own homes will be located at a soccer field in Shoreline, Wash., a city spokesman said.
GOVERNORS WEIGH IN
After the briefing, Trump went to the Federal Emergency Management Agency, which is leading the national coronavirus response, to have a teleconference with governors, who have complained of a lack of tests and medical supplies. Vice President Mike Pence said the response, though federally supported, will be executed by state and local officials.
“The federal government’s not supposed to be out there buying vast amounts of items and then shipping,” Trump said. “You know, we’re not a shipping clerk.” He said governors “are supposed to be doing it.”
“We’ll help out and we’ll help out wherever we can,” he said. Just a day earlier, though, Trump invoked emergency powers enabling the federal government to shape private-sector production to try to fill critical shortages in ventilators, masks and other supplies
for patients. U.S. officials said cases are certain to surge as backlogged labs report results and as infection continues to grow in the population.
As New Orleans becomes one of the nation’s virus hot spots, Louisiana Gov. John Bel Edwards said a surge in new cases filling hospital beds with patients could push past the state’s capacity to deliver health care in seven to 10 days.
Maryland Gov. Larry Hogan said states need more federal funding and increased access to test kits, ventilators and other supplies to fight the coronavirus.
Hogan, chairman of the National Governors Association, has compiled a list of immediate needs from the federal government.
Governors want maximum flexibility for using the National
Guard and more guidance on how the Defense Production Act will be implemented, he said. The act, invoked by Trump on Wednesday, gives the federal government broad authority to direct private companies to meet the needs of the national defense.
Hogan said governors also are requesting a delay or greater flexibility for completing the 2020 census and the transition to Real ID. Information for this article was contributed by Jill Colvin, Deb Riechmann, Matthew Perrone, Matthew Lee, Melinda Deslatte and Brian Witte of The Associated Press; by Evan Bush of The Seattle Times; by Ariana Eunjung Cha of The Washington Post; by Alan Rappeport and Emily Cochrane of The New York Times; and by Laura Davison, Daniel Flatley and Steven T. Dennis of Bloomberg News.