Unsanitized: How the Parties Play the Coronavirus Response Game in Congress

Also, time to crowdsource, and opposition to privatization from private banks. This is The COVID-19 Daily Report for April 29, 2020.

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First Response

On the CARES Act and its recent expansion, the Senate took the lead in crafting the packages. On “Phase 4” or “Phase Q” or whatever they’re calling the next bill, the House is supposed to take the lead. With Republicans in control of the Senate and Democrats in control of the House, this gives us a natural experiment into how each party handles negotiations.  

The Senate fully wrote their CARES Act bills, setting the baseline for the negotiation. Then Democrats suggested tweaks. The Senate put their bills on the floor for votes, trying to intimidate the opposition. Those efforts failed, but the end result were minor improvements that kept the baseline framework.

The House hasn’t written its Phase 4 bill, but the most prominent force in shaping it so far is… Senate Majority Leader Mitch McConnell.

First, McConnell floated that cities and states should go bankrupt instead of receiving financial aid to prevent a depression. That was a thinly veiled attempt to bust public employee pensions. Then, he said that any future bill must include a broad liability shield for reopened businesses, protecting them from lawsuits over COVID-19 infections. This is just a pure set of talking points from the Chamber of Commerce and the National Association of Manufacturers, whose members don’t want to invest in keeping workers and customers safe and who would rather get Congress to bail them out from that investment.

Finally, on Tuesday McConnell defied House Democrats and even President Trump by saying he doesn’t favor any infrastructure spending in the next bill. “We need to keep the White House in the box,” he told his caucus. “The Democrats and the White House both need to get the message.”

Read all our Unsanitized reports

So there’s the coronavirus response negotiation framework of each party. Democrats wait for Republicans to complete their work, make helpful suggestions, and eventually get to a place where they pass the bills (almost) unanimously. Republicans don’t wait for any bill, instead making a list of demands first and vowing to prevent anything that doesn’t include them from passage. And the Republican demands, of course, are far more along the lines of defining the package rather than moving it in a friendlier direction. Republicans act, Democrats react.

It’s good to have definitive evidence of this!

Meanwhile, I don’t know why there’s very much anticipation of a Phase 4 bill, when the House doesn’t exist as an institution anymore. Steny Hoyer delayed the House return from recess slated for next week, citing unspecified consultation with the House physician. (In actuality, members were concerned about safety.) We still don’t have remote voting after Democrats punted on it last week. The New Democrat Coalition, a group of centrist legislators, endorsed remote voting on Monday for “no later than the week of May 4,” vowing to vote for any resolution even if Republicans oppose wholesale. But that requires a vote and nobody will be in. So the House is in suspended animation, unable to take the lead on anything.

The Senate, by contrast, will be back next week, mostly to confirm a bunch of right-wing judges. A hundred Senators in a similar-sized chamber as the 435-member House means physical distancing can be more easily practiced. But that only should have added urgency to House Democrats to figure out a remote voting solution. Instead they have managed to lose leverage and disenfranchise their entire chamber, as McConnell bulldozes them and gets key priorities accomplished.

It’s now passé to say that the crisis spotlight shines on existing cracks in our society. But existing cracks in our politics are being exposed, too.

The Future of Labor

We have an incredible series over at the Prospect today about the future of labor in post-pandemic America. We asked seven journalists, labor historians, and strategists about how workers and their movements will fare in the months and years ahead, and their proposals for what needs to be done. The coronavirus crisis has given new understanding of who's "essential" in our economy and what they deserve. How will workers use this power? What can they do to improve their jobs and conditions?

The series features contributions from historians Ruth Milkman, Nelson Lichtenstein, and Lane Windham; organizer Steven Lerner; former Labor Department official David Weil; and journalists Mike Elk and Steven Greenhouse. It’s part of our commitment to stories about working in America, especially in the wake of this crisis.

I urge you to check out the series.

Homework Assignment

You may not know it but I also run a magazine, in addition to writing a daily report. This happens to be my crunch week for the magazine. So I am unable to give something the attention it deserves. That’s where you come in.

Donna Shalala, who readers may know, failed to disclose stock sales for the entirety of her tenure in Congress, in violation of federal law. When caught, she vowed to get the “half a dozen” disclosures out into the world as soon as possible. It turns out that there were 556 unreported transactions. At $200 per violation, that should be a $111,200 fine, which should wipe out the national debt unless I did the math wrong. (Shalala has sent $1,200, still clinging to the “half a dozen” missed reports, which would have had a collection of sales on each.) But that’s not important right now.

The transactions include purchases, not just sales. As recently as last summer, Shalala was buying individual stocks, including Exact Sciences Corp. (which does colon cancer screenings), NovoCure Limited (a cancer treatment company), and Global Blood Therapeutics (a drug company). Shalala sits on the Education and Labor Committee, which has jurisdiction over health care. She’s already admitted to not selling all of her stock in UnitedHealth, where she sat on the board for six years.

That’s a plain and simple conflict of interest. I want to know if there are more, but my time is short. Your mission, should you choose to accept it, is to scan the 556 transactions in the transaction report. The “P” in transaction type stands for purchase, and the “S” for sale. You see a lot of times the P will offset the S, which maybe means the conversion of the stock into the blind trust? Others are just straight sales. I want to know how many purchases there are without sales. I also want to compare this to Shalala’s initial financial disclosure, to see if there are any stocks that don’t appear to have been sold. (They could have been sold in between the end of 2018 and her January 3, 2019 swearing-in, but that’s unlikely.)

Let’s crowdsource this thing! Let me know what you see.

They Said It

My mouth is still hanging open over this New York Times story. It’s about Treasury Secretary Steve Mnuchin vowing to audit any “small business” loan over $2 million, to screen for companies deemed undeserving who got the forgivable loans. But the interesting part is when Richard Hunt, president of the Consumer Bankers Association, states that “the government should have given money directly to businesses or offered even more generous economic stimulus payments or unemployment insurance.”

I get that banks are frustrated by the terrible government IT infrastructure making it hard to process loans, the confusions of the program, and how it may sully their reputations. But here you have the trade group leader of one of the biggest institutions in America saying the problem was that the government outsourced a function it should provide itself. In other words, the first impulse should be public provision of services, not privatization.

Duly noted for the future!

Today I Learned

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