Trump Threatens to Permanently Cut WHO Funding

Plus: A deal to bring drug manufacturing back to U.S.

Trump Threatens to Permanently Cut WHO Funding

President Trump threatened late Monday to permanently stop funding the World Health Organization and “reconsider” U.S. membership in the group if it does not “commit to major substantive improvements within the next 30 days.”

Trump didn’t specify what changes he is seeking, but in a scathing four-page letter to WHO Director-General Tedros Adhanom Ghebreyesus posted to Twitter shortly before 11 p.m., the president repeated many of the accusations he has leveled in recent weeks against the United Nations agency and its response to the Covid-19 pandemic. He alleged that the WHO ignored early reports of the virus spreading in Wuhan, China; repeated inaccurate or misleading information from the Chinese government while failing to share other information; and failed to press China for an independent investigation into the origins of the virus. Trump again criticized what he called the WHO’s “alarming lack of independence” from Beijing.

“It is clear the repeated missteps by you and your organization in responding to the pandemic have been extremely costly for the world,” Trump wrote. “The only way forward for the World Health Organization is if it can actually demonstrate independence from China.”

The background: Trump had initially praised China’s response to the pandemic, but as the U.S. death toll rose and criticism of his administration’s own response mounted, he shifted to attacking both WHO and Beijing. Last month, Trump suspended U.S. payments to WHO for 60 days, sparking criticism and an outpouring of international statements supporting the organization and warning of the risks of cutting its funding in the midst of a pandemic. The United States is the largest source of funding for the agency. About $400 million in annual funds to WHO have been halted since last month, according to The Washington Post.

A measure adopted at a virtual gathering of WHO member nations this week calls for the organization to undertake an independent review of its pandemic response at the “earliest appropriate moment.”

The responses: The WHO said in a statement that it was “considering the contents” of Trump’s letter. A Chinese official, meanwhile, said the Trump administration was violating its international obligations and “trying to mislead the public, smear China and shift blame for its own incompetent response,” according to the Post.

Medical journal The Lancet knocked Trump for what it said was a “factually incorrect” statement in his letter. Trump had written that WHO had ignored credible reports, including from The Lancet, in December about the virus spreading in Wuhan, China. The Lancet said it “published no report in December, 2019, referring to a virus or outbreak in Wuhan or anywhere else in China.” Its first reports on the virus were published January 24, it said.

“The allegations levelled against WHO in President Trump’s letter are serious and damaging to efforts to strengthen international cooperation to control this pandemic,” The Lancet statement said. “It is essential that any review of the global response is based on a factually accurate account of what took place in December and January.”

Why it matters: Trump’s latest threat is likely to heighten concerns that the United States is ceding its leadership role and allowing China to enhance its global standing — criticisms that the administration strongly rejects. China has pledged an additional $30 billion to the WHO. Chinese President Xi Jinping this week called on countries to rally behind the WHO and pledged $2 billion to fight the pandemic around the world, a move U.S. officials saw as a further attempt to fend off accountability for China’s coronavirus response.

Congressional Budget Office Forecasts High Unemployment Lasting Through Next Year

The Congressional Budget Office on Tuesday released an updated economic forecast, predicting that GDP will shrink at an annual rate of 38% in the second quarter and that the unemployment rate will peak at nearly 16% in the third quarter. Even as the economy beings to recover over the second half of this year, CBO expects the unemployment rate to remain high, averaging 9.3% in 2021 as the “persistence of social distancing will keep economic activity and labor market conditions suppressed for some time.” It sees the unemployment rate falling to just 8.6% by the end of 2021.

Those projections are actually slightly better than CBO’s previous estimates, released in April, but they underscore just how lasting the economic damage is likely to be. "Compared with their values two years earlier, by the fourth quarter of 2021 real GDP is projected to be 1.6 percent lower, the unemployment rate 5.1 percentage points higher, and the employment-to-population ratio 4.8 percentage points lower," the report said.

The budget scorekeeper also said that the four pandemic-related laws enacted by Congress since the beginning of March are projected to increase the federal deficit by $2.2 trillion in fiscal year 2020 and by $600 billion in fiscal year 2021. Those figures equate to about 11% of nominal GDP this year and 3% in fiscal 2021.

Quote of the Day: The Odds of Another Coronavirus Relief Bill

"We may not be able to pass another bill. I think it's less than 50 percent chance of passing another bill."



– Sen. John Kennedy (R-LA), suggesting during a Senate Banking Committee hearing Tuesday that the odds of Congress passing another coronavirus relief bill are low.

Kennedy has introduced legislation to allow state and local governments more flexibility in how they use $150 billion in funding Congress has already provided, including allowing them to use the money to cover budget shortfalls.

Trump Administration Awards New Contract to Bring Drug Manufacturing Back to US

The Trump administration said Tuesday that it has awarded a $354 million contract for a private sector team led by a Virginia-based startup called Phlow Corp. to make generic drugs and their ingredients in the United States. Administration officials hailed the deal as an important step in efforts to bring back offshore pharmaceutical manufacturing after the coronavirus pandemic highlighted the risks of those supply chains being mostly in India and China.

“The COVID-19 pandemic has reminded us how health threats or other sources of instability can threaten America’s medical supply chains, potentially endangering Americans’ health,” Health and Human Services Secretary Alex Azar said in a statement. “Working with the private sector, HHS is taking a significant step to rebuild our domestic ability to protect ourselves from health threats by utilizing American-made ingredients and creating new American jobs in the process.”

The contract can be extended for up to a total of $812 million over 10 years, HHS said.

House Progressives Call for Pentagon Budget Cuts

A group of 29 liberal House Democrats wants to cut military spending, arguing that the money is better spent fighting the coronavirus pandemic.

“Congress must remain focused on responding to the coronavirus pandemic and distributing needed aid domestically,” the lawmakers wrote in a letter to the leaders of the House Armed Services Committee. “In order to do so, appropriators must have access to increased levels of non-defense spending which could be constrained by any increase to defense spending.”

The letter noted that U.S. military spending already outpaces that of the next 10 nations combined.

Why it matters: The liberals’ demand “stands to greatly complicate the Democratic-controlled House’s ability to advance the National Defense Authorization Act, one of the most consequential must-pass measures that Congress assembles each year,” writes Mike DeBonis at The Washington Post. Republicans and moderate Democrats aren’t likely to go along with defense budget cuts, so the question may be how far progressives want to push the issue and how willing they are to use their leverage. “With 29 signatures, the letter carries an implicit ultimatum,” DeBonis says: “Should Democratic leaders move forward with an outsize defense bill, they will need to do so with Republican votes. The signers could together block the bill from passage if the GOP unites against Democrats, as it did last year.”

Read more at The Washington Post or Politico.

9 Ways the Pandemic Could Permanently Change U.S. Health Care

Lev Facher of health and medicine site STAT spoke to a wide range of policy experts about how the coronavirus pandemic could permanently upend U.S. health care. Here are nine big changes they predicted:

  1. Covid-19 has accelerated telemedicine ‘by a decade’;
  2. Shifting away from traditional employer-based health insurance;
  3. Out with nursing homes and assisted living facilities — and in with home health aides;
  4. A reckoning on racial disparities and social determinants of health;
  5. More questions about drug affordability, with a chance for pharma to rehab its reputation;
  6. A renewed emphasis on manufacturing drugs in America;
  7. A focus on scaling up preparedness and emergency personnel;
  8. Allowing nurses, nurse practitioners and physician assistants to play a bigger role in care;
  9. More interest in models beyond fee-for-service medicine.

Read the full story at STAT. It's worth your time.

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