Trump Ousts Watchdog for Coronavirus Funds

Plus: Another $250 billion for the paycheck protection program?

Mnuchin Requests $250 Billion More for Small Business Program

Treasury Secretary Steven Mnuchin asked Congress on Tuesday to add $250 billion to the small business aid program that went into effect last week as part of the federal response to the coronavirus pandemic. The funds would supplement the $350 billion already designated by Congress for the Paycheck Protection Program, part of the more than $2 trillion aid package signed into law two weeks ago.

Mnuchin said he had spoken with Senate Majority Leader Mitch McConnell, Senate Minority Leader Schumer, House Speaker Nancy Pelosi and House Minority Leader Kevin McCarthy about the request. McConnell said he hoped to put the request up for voice vote in the Senate in a pro forma session on Thursday.

However, a spokesperson for Schumer said the request may need to be discussed. Some Democrats have expressed concern that the program is benefiting small businesses that have pre-existing relationships with the banks administering the program while leaving behind those that do not. “Without proactive and sustained outreach, we can expect that underserved communities will be disproportionately harmed,” a group of Democratic senators said in a statement.

Strong interest so far: The small business lending program has been met with tremendous demand, despite a rocky start last Friday, with tens of thousands of small business owners, sole proprietors and independent contractors applying for funds to help tide them over during the unprecedented economic slowdown. The loans are limited to $10 million or 250% of payroll and are eligible for forgiveness if the money is used for overhead and employee pay.

As he met with bank executives Tuesday at the White House, President Donald Trump said that the Small Business Administration had already processed $70 billion in guaranteed loans. Banks still need to complete the loan processes and distribute the funds.

More aid on the way: The request for additional funds comes amid a growing consensus that the $2 trillion aid package won’t be enough to sustain the millions of Americans affected by the economic plunge. House Speaker Nancy Pelosi said this week that another $1 trillion is needed, and Trump has indicated that another significant aid package is under consideration.

Chris Krueger of Cowen Research said Tuesday he expects Congress to pass one or more coronavirus relief packages worth roughly $1.5 trillion in the next few weeks. In addition to more small business aid, he said lawmakers will likely provide direct cash payments, assistance to states, and more money for the health care system and social safety net programs. “The fourth COVID-19 related piece of legislation is now likely a question of when, not if,” Krueger said in a research note. “This is not aimed at stimulus/recovery. The policy response remains focused on disaster relief.”

Hazard pay? Senate Minority Leader Chuck Schumer said Tuesday that Democrats are proposing hazard pay of up to $25,000 for workers dealing with the coronavirus crisis, including doctors, nurses, truck drivers and grocery clerks. The bonus would be available to workers making less than $200,000 a year; those earning more than that would receive $5,000. Democrats have also discussed recruitment payments of $15,000 to attract and keep essential workers, The Hill reported.

Trump Ousts Watchdog Overseeing $2 Trillion Coronavirus Relief

President Trump has ousted the federal watchdog leading the panel Congress established to oversee implementation of the $2 trillion coronavirus relief law.

Trump removed Glenn Fine, the acting Defense Department inspector general, from his post on Monday, making him ineligible to serve as chairman of the new Pandemic Response Accountability Committee. The new coronavirus relief law allows only current inspectors general to fill that role.

The president designated Sean O'Donnell, the inspector general of the Environmental Protection Agency, to serve as the temporary Pentagon watchdog in addition to his current position. Trump also picked Jason Abend to be the permanent inspector general at the Defense Department, but the nomination requires Senate confirmation.

Fine had served as acting Pentagon inspector general for more than four years and had been inspector general at the Justice Department for 11 years.

Why it matters: The move “will be seen by some as another instance of the president chafing at independent oversight,” The Washington Post’s Ellen Nakashima says.

Rep. Adam Smith (D-WA), the chairman of the House Armed Services Committee, told reporters Tuesday that the move concerned him, adding that it represents a larger pattern of the president seeking “sycophants” and loyalists. "This is leading to an epidemic of incompetence throughout the government," Smith said. "What he cares about is people kissing his ass. If the job gets done? That's secondary."



Critics have plenty of examples in Trump’s recent dealings with independent federal watchdogs.



Trump on Friday fired the inspector general of the intelligence community, who had informed Congress about the whistleblower complaint the led to the president’s impeachment. This week, Trump has attacked the Health and Human Services inspector general after the office issued a report that said hospitals were citing “severe shortages of testing supplies” and other issues that were hampering their ability to care for patients and staff. “Many hospitals noted that they were competing with other providers for limited supplies, and that government intervention and coordination could help reconcile this problem nationally,” the report said.

“Another Fake Dossier!” Trump tweeted Tuesday morning.

At his Monday coronavirus briefing, he dismissed the report as “just wrong” without any further details or evidence and he implied that the inspector general and her report might be politically motivated. “Where did he come from, the inspector general?” Trump snapped at a reporter Monday. “What’s his name?”



He implied the same on Tuesday, noting that the IG had served during the Obama administration. Christi Grimm, the principal deputy inspector general at HHS who authored the report, has served in the office since 1999 under both Democratic and Republican administrations.

Eli Lilly Introduces Program to Lower Insulin Costs

Drug giant Eli Lilly said Tuesday that it is capping the out-of-pocket cost of its insulin at $35 a month to help patients who may face financial struggles as a result of the coronavirus pandemic. The new program is available for people with commercial insurance or without insurance. Patients with government insurance, including Medicaid, Medicare, Tricare or any State Patient or Pharmaceutical Assistance Program, are not eligible.

"Too many people in the U.S. have lost their jobs because of the COVID-19 crisis, and we want to make sure no one goes without their Lilly insulin," Mike Mason, president of Lilly’s diabetes division, said in a statement.

The context: Insulin makers, including Lilly, have faced intense criticism as the price of the drug has soared in recent years and Reuters notes that the three top producers, Lilly, Sanofi SA and Novo Nordisk, have lowered the costs of their diabetes drugs to blunt such criticism.

The Trump administration, meanwhile, announced a plan last month to create a flat monthly copay of $35 for Medicare enrollees with diabetes, with a test of the program planned for next year. The administration said that Medicare beneficiaries pay an average of about $675 a year for insulin and projected that the new program could lower than to $229 a year, saving the government $250 million over five years.

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