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Staying afloat: $2.2 trillion bill offers economic lifeline



WASHINGTON (AP) — In the coronavirus crisis, even doctors can face a cash crunch.

Dr. Benjamin Ticho, an ophthalmologist in Chicago Ridge, Illinois, has seen his revenue plunge 80% as patients stay home and he cancels non-emergency surgeries. He’s cut his staff’s hours sharply and is negotiating with his creditors.

“We’ve reached out to many of our bigger vendors and said, ‘Hey, we may be facing a crash crunch — can you give us a break, or at least defer payments?’ Many have been sympathetic,” said Ticho, who owes loans on medical equipment. He’s giving his patients a break, too, by holding off for now on collecting their unpaid balances.

The record $2.2 trillion emergency package nearing final approval in Congress is aimed at businesses like Ticho’s and people like his patients: Caught in a public health lockdown that has closed companies and brought economic life to a standstill, they are at risk of running out of money and being unable to pay bills or meet daily expenses.

The idea is to give companies and families a cash cushion to better weather the health crisis and looming recession. When it’s safe to go back to work, dine out and book airline tickets again, the thinking goes, they’ll be more financially ready to return to something closer to normal life.

“It will inject trillions of dollars of cash into the economy as fast as possible to help American workers, families, small businesses and industries make it through this disruption and emerge on the other side ready to soar,’’ said Senate Majority Leader Mitch McConnell, R-Ky., who helped negotiate the package. The House is expected to vote on the plan Friday.

So Congress is sending a one-time payment directly to most American adults and U.S. residents with Social Security numbers. That amounts to $1,200 for single adults earning up to $75,000 a year and $2,400 for married couples earning up to $150,000, plus $500 per child. Someone filing as head of household would get the full payment if they earn $112,500 or less.

The payment is reduced by $5 for each $100 that a taxpayer’s income exceeds those thresholds, and is completely phased-out for single filers with incomes exceeding $99,000, $146,500 for head of household filers with one child, and $198,000 for joint filers with no children.

The package would also help replace the earnings of unemployed workers for four months, providing them with their state’s unemployment benefits plus an extra $600 a week. For the first time, gig economy workers such as Uber drivers can claim unemployment benefits, too.

The support for individuals and households is especially important because the social safety net in America isn’t as strong as it is in the wealthy developed countries of Europe.

The package includes $50 billion in tax credits for businesses that keep employees on payroll and will cover 50% of those workers’ paychecks. Companies can also defer payment of the 6.2% Social Security tax, giving them an incentive to put off layoffs at a time when ordinary business has come to a halt.

Also included is $454 billion in seed money that will allow the Federal Reserve to make roughly $4.5 trillion in loans to larger industries.

At $2.2 trillion, the money that Congress and the Trump administration are throwing at the economic crisis amounts to more than 10% of America’s gross domestic product — the broadest measurement of economic output. By comparison, President Barack Obama’s $787 billion stimulus plan in the depths of the Great Recession amounted to about 5.5% of GDP.

And that doesn’t count what else the Fed is doing. It has slashed its benchmark interest rate to zero. It’s flooding financial markets with cash by buying up securities, including government and, for the first time, corporate bonds. It’s also buying so-called commercial paper, short-term IOUs that companies issue to cover operating costs such as payrolls. And it’s readying a loan program for small businesses.

Fed Chair Jerome Powell has made clear that the central bank will do what it takes to support the economy. In an interview Thursday on NBC’s “Today” show, Powell said the Fed would lend an essentially unlimited amount, if necessary, to support banks, businesses and city and state governments until the viral outbreak is brought under control.

The chairman acknowledged that the economy will suffer and that unemployment will rise.

“There can also be a good rebound on the other side of that,” he said. “By assuring the flow of credit in the economy and keeping rates low, we want to assure that that rebound, when it does come, is as vigorous as possible.”

“Except for wartime expenditures during World War II there is nothing comparable to this in U.S. history,” said Adam Posen, president of the Peterson Institute for International Economics in Washington, D.C.

This rescue isn’t just bigger. It’s also different in significant ways.

In most economic downturns, even severe ones, policymakers aim at coaxing jittery consumers and businesses to start spending again by slashing interest rates, cutting taxes, or putting people to work on public works projects and giving them paychecks.

It’s not going to work that way this time. Nobody is going to go out shopping or schedule a cruise when they’re quarantined indefinitely inside their living rooms. And businesses aren’t going to hire, open new offices or invest in equipment when they aren’t collecting revenue because they have no customers.

Policymakers now just want to keep businesses and individuals from going under while the virus still rages, hoping they’ll be in shape to drive a recovery when the crisis is over.

“They’re truly focusing on stopping the system from freezing up,’’ said Louis Hyman, an economic historian at Cornell University who has studied the labor market and gig workers.

For now, it seems, there’s no way to turn back the forces pulling the economy into recession for the first time in 11 years. Economists are expecting the April-June quarter to be the worst on record. The economy may plunge at an annual rate of 20% or more over those three months. Millions of Americans are expected to lose their jobs in the next few weeks. On Thursday, the Labor Department reported that 3.3 Americans had filed for unemployment benefits last week — shattering the 1982 record of 695,000.

The rescue being cobbled together by the Fed, Congress and the White House is designed to reach business owners such as New York tour operator Georgette Blau, who has laid off her tour guides and tapped her personal savings to keep her On Location Tours operating.

Blau is uneasy about seeking a loan from the Small Business Administration, saying the monthly payments would be too high. She would consider looking into the Fed’s plans to provide credit to small firms. But it won’t be easy to calm her financial worries.

“Even something like $75,000 is not going to last us very long,’’ she said.

The scale of the damage is staggering. More than 180,000 stores are temporarily shuttered, accounting for more than 40% of U.S. retail space, according to GlobalData Retail, a research firm.

“Retailers were caught up in a nightmare,” said David French, senior vice president of government relations at the National Retail Federation, the nation’s largest retail trade group. “They have people to pay. Rents to pay. They have inventories.”

No money is coming in at Olio, a wedding and event venue in Peabody, Massachusetts. Owners Sarah Narcus and Ellen Basch have canceled or postponed all events through the spring. They’ve asked, and gotten, leniency from their lenders, including the bank that holds the million-dollar mortgage on their building.

“They were very receptive. They have deferred payments except for interest and escrow for 90 days,” Narcus says. The business still has to pay other expenses including taxes and utilities.

To keep what could be a steep but short recession from turning into something worse, economists say the government needs to move fast.

But it won’t be easy.

“No set of existing financial pipes was designed for a crisis requiring payments to more than 100 million individuals or households within days or weeks,’’ write Peterson Institute researchers Donald Hammond and David Wilcox.

They are worried that the government will rely on income tax rolls to identify recipients; but many Americans, especially the poorest ones, don’t pay income taxes and can’t be found that way. They suggest using Social Security records and federal assistance rolls, too.

“We urge policymakers to emphasize the need for speed,’’ Hammond and Wilcox write, even if it means some Americans accidentally get more than one relief check. “In most cases, the people who receive multiple payments will be at the lower end of the economic ladder and thus likely to be in great need of help.’’

Cornell’s Hyman expects that the government will make mistakes as it tries to roll out so much money, so quickly. But he’s impressed with the rescue package anyway.

“It’s the biggest intervention in human history, and it’s all done in a week,’’ he said. “It’s crazy.’’


Rosenberg reported from New York. AP Economics writers Christopher Rugaber in Washington and Anne D’Innocenzio in New York contributed to this report.

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Trump says he did not see memos by adviser Navarro warning of coronavirus risks



U.S. President Donald Trump takes questions as he addresses the daily coronavirus task force briefing at the White House in Washington, U.S., April 7, 2020. REUTERS/Kevin Lamarque

WASHINGTON (Reuters) – President Donald Trump said on Tuesday that he had not seen memos by White House trade advisor Peter Navarro warning of coronavirus risks, and that he retained confidence in Navarro.

Navarro, a China hawk, sent a memo in late January warning the new coronavirus could create a pandemic and urged a travel ban for China, the New York Times reported. A second memo, written in late February and sent to the president, said it could kill up to 2 million Americans.

Asked if he still had confidence in Navarro, Trump said, “Of course.” “Peter is a smart guy, a good guy,” the president said.

Reporting by Diane Bartz; Editing by Chris Reese

Our Standards:The Thomson Reuters Trust Principles.

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Trump Dismantled the Very Jobs Meant to Stop the Covid-19 Epidemic



After 9/11, we swore to never let that happen again. “Never again” was the mantra handed down to the nation’s leaders by George W. Bush in the White House on September 12th. We devoted billions—trillions, even—of dollars after 2001 to fixing the intelligence and information-gathering problems identified by the 9/11 Commission, and Congress and George W. Bush worked through the biggest reorganization of the government since 1947 to create two entirely new entities to help prevent “the next 9/11”: The Department of Homeland Security, an attempt to bring together all the agencies tasked with protecting the country at home, and the Office of Director of National Intelligence, a coordinator for the nation’s 17 disparate intelligence agencies to ensure that the country better understood both the big picture and the small picture of what was happening around the world.

Unfortunately, President Donald Trump’s routine, day-to-day mismanagement of the government has left both organizations—the very entities we tasked as a nation to prevent the next 9/11—riddled with vacancies and temporary officials as the novel coronavirus rapidly spread from a small blip in China to a global health and economic catastrophe. In fact, the four top jobs at DHS and ODNI have all been filled with temporary acting officials for literally every day that Covid-19 has been on the world stage.

While we often think of those jobs as focused on protecting against terrorism, both agencies have critical public health roles too; U.S. intelligence spent the winter racing to understand how serious a threat Covid-19 truly was and deciphering the extent of China’s cover-up of its epidemic. Just last week, news broke about a special report prepared by U.S. intelligence documenting China’s deception about the disease’s spread—information that, had it been more accurately captured and understood, might have caused a faster, harder response and lessened the economic and personal toll of the epidemic at home.

Yet Trump has churned through officials overseeing the very intelligence that might have helped understand the looming crisis. At Liberty Crossing, the headquarters of the Office of Director of National Intelligence, the government will have been without a Senate-confirmed director for eight months as of next week; last summer, Trump accepted the resignation of Dan Coats and forced out the career principal deputy of national intelligence, Sue Gordon. Coats’ temporary stand-in, career intelligence official Joseph Maguire, then served so long that he was coming close to timing out of his role—federal law usually only lets officials serve for 210 days before relinquishing the acting post—before Trump ousted him too, as well as the acting career principal deputy. In their place, at the end of February—weeks after the U.S. already recorded its first Covid-19 case—Trump installed German ambassador Richard Grenell as his latest acting director, the role that by law is meant to be the president’s top intelligence adviser. Grenell has the least intelligence experience of any official ever to occupy director’s suite.

This Friday, the role of homeland security secretary will have been vacant for an entire year, ever since Kirstjen Nielsen was forced out over Trump’s belief she wasn’t tough enough on border security. DHS has numerous critical roles in any domestic crisis, but its acting secretary, Chad Wolf, has fumbled through the epidemic; in February, Wolf couldn’t answer seemingly straightforward questions on Capitol Hill from Republican Senator John Kennedy (La.) about the nation’s preparedness—what models were predicting about the outbreak, how many respirators the government had stockpiled, even how Covid-19 was transmitted. “You’re supposed to keep us safe. And you need to know the answers to these questions,” Kennedy finally snapped at Wolf. Wolf has been notably absent ever since from the White House podium during briefings about the nation’s epidemic response.

“Actings” often struggle to be successful precisely because they’re temporary—their word carries less weight with their own workforce, with other government agencies or on Capitol Hill—and they rarely have the opportunity to set and drive their own agenda, push for broad organizational change, or even learn the ropes of how to be successful in the job given the usually brief period of their reign. Anyone who has ever changed jobs or companies knows how long it can take to feel like you understand a new organization, a new culture or shape a new role.

And yet up and down the org chart at DHS, there are people still learning the ropes. DHS is riddled with critical vacancies; according to the Washington Post’s appointment tracker, just 35 percent of its top roles are filled. Its chief of staff, executive secretary and general counsel are all acting officials, and there’s no Senate-confirmed deputy secretary, no under secretary for management, no chief financial office, no chief information officer, no under secretary for science and technology, nor a deputy under secretary for science and technology.

Even as we face a global crisis with complex travel restrictions and health guidelines, there are no Senate-confirmed leaders of any of DHS’s three border and immigration agencies—Customs and Border Protection (CBP), Immigration and Customs Enforcement (ICE) or U.S. Citizenship and Immigration Services (USCIS). Nor is there a deputy administrator at the Transportation Security Administration (TSA), as the airline industry faces an existential cutback to global travel.

Matthew Albence, the acting head of ICE, which faces a growing Covid-19 problem in its national network of detention facilities, has been “acting” for so long that he’s surpassed the 220-statutory limit for the role and instead is now technically the “senior official performing the duties of the director,” a legal term of art that’s become all too common around the federal government as vacancies linger in the Trump era. Ken Cuccinelli, the similarly-titled “senior official performing the duties of the USCIS director,” who is simultaneously also DHS’s temporary No. 2, the “senior official performing the duties of the deputy secretary,” is currently appealing a court ruling that he’s not even legally serving at DHS.

When Trump turned to DHS’s FEMA last month to oversee the federal government’s coronavirus response, the agency lacked Senate-confirmed officials in either of its deputy roles—including its deputy overseeing preparedness and continuity of government planning, a function that may become all-too-important in the days ahead if the virus sickens government leaders, as UK Prime Minister Boris Johnson has already been hospitalized.

And the assistant secretary for countering WMD—the person who oversees DHS’s chief medical officer, the doctor designated to advise the DHS secretary and the head of FEMA? That job is vacant too. Meanwhile, in addition to its role serving the nation, DHS itself faces a growing number of Covid-19 infections in its own workforce—up to 600 cases as of Monday’s numbers, including 270 TSA employees and 160 CBP employees.

The effect of these vacancies ripple further than most people realize. Since vacant roles awaiting either an official appointment or a Senate-confirmed nominee are always filled by “acting” officials pulled from other parts of the organization or broader government, even more offices are understaffed as people do double-duty and as their own positions are filled with other “actings” behind them. Grenell, even as he fills in as director of national intelligence, continues to technically be the U.S. ambassador to Germany, meaning that amid the huge economic uncertainty around Covid-19 epidemic the U.S. is without a high-level envoy to the largest economy in Europe. For the 14 months he was “acting” White House chief of staff, up until March 31—another horse Trump changed mid-stream in the epidemic—Mick Mulvaney was still technically serving as the director of Office of Management and Budget, a normally critical role itself overseeing the nation’s spending. In Mulvaney’s absence, Russell Vought, OMB’s deputy, filled in as the acting director—leaving his own job, normally its own full-time role, to be filled in by others, and so on.

In government agencies, deputies are not like the vice president—a spare role kept around, if needed. Often, the “deputy” role is the most important figure in the day-to-day operations of the department or agency—the person who runs the bureaucracy and organization while the principal (the secretary or director) attends to the policy and the politics. Robbing an agency or department of a principal and forcing the deputy to fill in means the organization will be running at reduced effectiveness, with less guidance, direction and oversight.

The vacancies at DHS and ODNI are hardly the whole story of how Trump has hampered the very jobs meant to protect the nation in crisis. While much attention has been focused on Trump’s decision to shutter the National Security Council’s pandemic unit, less attention has focused on an even more critical change in the NSC’s structure. Another key post-9/11 reform was the creation of a White House homeland security advisor, a domestic equal to the national security advisor, a post created just days after 9/11 by President George W. Bush and filled at first with Tom Ridge, who would go on to be the first homeland security secretary. Presidents Bush and Obama for years had at their beck and call senior, sober homeland security advisors like Fran Townsend, Ken Wainstein, John Brennan and Lisa Monaco; Monaco helped oversee the nation’s response to Ebola and led the incoming Trump administration through a pandemic response exercise in the days before inauguration to highlight how critical such an incident could be.

Over the course of his administration, Trump effectively has done away with the role of homeland security advisor; when John Bolton took over as national security advisor, one of his first acts was to fire Homeland Security Advisor Tom Bossert and downgrade the role in rank. Ever since, the Trump NSC has sidelined the officials who filled the role. In February, as Covid-19 loomed domestically, Trump actually even shuffled the Coast Guard official then filling the post out to a new job, overseeing Puerto Rico’s disaster recovery.

Further afield from the homeland security roles, the empty holes in federal organization charts will continue to slow and hamper the government’s ability to respond at the speed and scale necessary to address a crisis of unprecedented complexity.

At the Treasury Department, Secretary Steve Mnuchin began confronting the crisis without a chief of staff or legislative director. As Bloomberg reported, “Of 20 Senate confirmed roles reporting to the secretary, seven aren’t filled, and four are occupied by acting officials. The domestic finance unit, which should be handling the brunt of the work related to the coronavirus outbreak, is particularly empty. It has no top boss and is missing three assistant secretaries, who are the next level down.”

At the Pentagon, the Navy faced last week’s Covid-19 crisis about the aircraft carrier USS Theodore Roosevelt without a Senate-confirmed navy secretary; Richard Spencer departed last fall amid the controversy of Trump’s pardoning of a Navy SEAL accused of war crimes. Now that Spencer’s successor as acting Navy secretary has himself resigned amid the carrier fiasco, the under secretary of the Army—the only one of the three service under secretaries now filled and a post he only took up two weeks ago—will apparently be filling as acting Navy secretary. To say that it’s less-than-ideal for all of those roles—which serve as each military service’s chief management officer—to be vacant in the midst of an unprecedented, global crisis is an understatement. Across the building, roughly a third of the Pentagon’s top jobs are vacant or filled with acting officials—an administration-high. The under secretary for personnel and readiness, Matthew Donovan, has only been on the job for about two weeks—the job sat vacant since July 2018—and there’s currently no undersecretary for policy.

Last year, the top job at the Food and Drug Administration, the role overseeing the nation’s pharmaceuticals, sat vacant for nearly eight months; the latest occupant, Stephen Hahn, took over in December, nearly a month after the first cases of Covid-19 were reported in Wuhan, China. At the Department of Veterans Affairs, which oversees a massive health care network and legally serves to supplement the civilian health care system in an emergency like the current epidemic, there’s no deputy secretary, general counsel or under secretary for health.

Meanwhile, there’s an acting director over at the Office of Personnel Management—the federal government’s equivalent of an HR department—even as the U.S. government’s two million civilian employees face the massive challenge of working from home and carrying on essential duties amid the Covid-19 crisis. Oh, and that acting director of OPM, Michael Rigas, who himself just took over in late March when the OPM director, who had been there for all of six months, quit just as the epidemic boiled over? He’s also serving as the acting deputy director at OMB. Confused? You’d hardly be alone. Wondering how someone can effectively lead one mission-critical organization while simultaneously working as the deputy of another? The answer is you can’t.

All of these vacancies are simple statements. They say nothing about the competence or longevity of the officials actually in any of the key roles, both of which deserve separate indictments: Trump is already on his fourth White House chief of staff, his fifth homeland security secretary and his fourth defense secretary—though the current occupant, Mark Esper, actually is technically the fifth person to occupy the role, since he was also “acting” secretary for 21 days before handing over the reins to Richard Spencer for eight days last summer while he was officially nominated for the permanent position.

Similarly, the experience of the officials who are in charge of many key departments and agencies is troublesome; Grenell, as acting DNI, has never worked in the intelligence community before, whereas his predecessors have been admirals, generals and the heads of various intelligence agencies themselves. At the Department of Veterans Affairs, the few leaders who do exist badly lack experience in crisis response, as the department’s inspector general reported in the early days of the coronavirus crisis. As the New York Times wrote, “At the Department of Veterans Affairs, workers are scrambling to order medical supplies on Amazon after its leaders, lacking experience in disaster responses, failed to prepare for the onslaught of patients at its medical centers.” The new head of the Office of Presidential Personnel, which is in charge of choosing appointees across the government, was fired earlier in the administration over allegations of financial crimes, and one of its top deputies is still a college student.

All of these revolving doors, empty offices and “temps” is precisely by design. Trump has spoken regularly about his preference for “acting” officials, saying they give him “flexibility.”

Someday, reports will be written about how the U.S. government failed in its response to the Covid-19 epidemic—failures that will surely have cost additional thousands of lives, additional millions of lost jobs, and additional billions (perhaps even trillions) in economic damages by the time this virus is behind us. And yet while those reports will surely point out specific management failures and lost opportunities to arrest the spread of Covid-19, the most basic conclusion of those future reports could already be written: Donald Trump’s Apprentice-style staffing bake-offs and his oft-voiced predilection for acting officials kept the U.S. government distracted, off-kilter and understaffed.

Trump is obviously not responsible for the appearance of the novel coronavirus—but he is responsible for the government’s spiraling failure to respond appropriately in a timely manner. He has ignored the hiring practices, protocols, norms and expertise that would have given him and the federal government a better shot at defeating Covid-19. Three years into his administration and with a Republican-controlled Senate ready to move nominees through to confirmation, he didn’t build the national leadership we needed. That inescapable fact is Donald Trump’s fault.

The “next 9/11” is happening right now because Trump ignored the lessons of the last one.

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86-year-old and three sons die after contracting COVID-19



The coronavirus pandemic is affecting nearly everyone in the world in different ways, but for one Louisiana family, the deadly virus inflicted a particularly devastating blow. Four members of the same family died after contracting the virus, including the 86-year-old matriarch. Antoinette Franklin and three of her sons all died within days of each other.

Antoinette Franklin, a lifelong New Orleans resident, died on March 23. Her son Herman Franklin Jr., 71, died on March 20. He was a father of eight, his obituary reads. Another of her sons, Anthony Franklin Sr., 58, died on March 26 and then a third, Timothy Franklin, 61, died on March 30.

All three brothers were memorialized at a “celebration of life” on April 3. According to the obituaries, there were nine other siblings in the family. 

A service was held for their mother on April 4 at Ebenezer Baptist Church, where she was a member for over 60 years.


Antoinette Franklin’s obituary says she had 12 children. Three of them died within days of her – all from the coronavirus.

A spokesperson for the New Orleans Coroner’s Office confirmed to CBS News that all four family members tested positive for COVID-19, noting their causes of death were still under investigation.

Louisiana has been one of the states hardest hit by the coronavirus.  In fact, New Orleans has had double the rate of deaths per capita than New York City, and the African American community has been disproportionately affected.

“Wake up! Covid-19 doesn’t discriminate in who it infects, but >70% of deaths in LA are African-American,” former New Orleans Mayor Mitch Landrieu tweeted. That statistic was shared earlier by Louisiana Governor John Bel Edwards during a press briefing. 

Landrieu compared the coronavirus crisis to Hurricane Katrina. “The communities that had generational wealth came back much faster [after Katrina]. You’ll see that with the people that have access to transportation and health care. The same is true with food security. Focus on equitable response,” he tweeted.

To date, there have been at least 4,942 confirmed coronavirus cases in New Orleans and 185 deaths, according to New Orleans Public Health.

The loss of so many members of the Franklin family in New Orleans echoes another heartbreaking story from New Jersey. In March, four members of the Fusco family died from the coronavirus, including 73-year-old Grace Fusco and three of her 11 children. 

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