Transparency and Profiteering During the Covid 19 Pandemic and Economic Slowdown
The American people are making extraordinary sacrifices to slow the spread of the Covid 19 pandemic. Several people and institutions are profiteering on it, and the Trump Administration is doing all within its power to conceal and shield its actions.
The $2 trillion CARES Act package includes three provisions for oversight: 1) Office of Special Inspector General for Pandemic Response, 2) Pandemic Response Accountability Committee, and 3) Congressional Oversight Commission. https://www.pogo.org/resource/2020/04/oversight-provisions-in-the-cares-act-what-they-are-what-they-do-and-how-to-make-sure-they-work-for-americans/
In his signing statement of the CARES Act, President Trump indicated he would block oversight whenever and wherever he chose. https://www.whitehouse.gov/briefings-statements/statement-by-the-president-38/ The legislation contains a bi-partisan oversight committee to be appointed by Congressional leaders; four have been selected, and the chair has yet to be selected by Leader McConnell and Speaker Pelosi. https://www.politico.com/news/2020/04/17/french-hill-coronavirus-oversight-panel-192660
Oversight has not yet happened, but money is flying out the door. https://time.com/5823510/coronavirus-stimulus-oversight/ The SBA loans of $350 billion to allow small businesses to retain their workforces are depleted. It appears that big corporate restaurant and motel chains were the big winners and mom and pop stores were not; it appears that construction firms in Texas were big winners, and Main Street small businesses in the hard hit retail and small restaurant sectors were not; as Paul Krugman put it; those with the “fastest wagons” (i.e. the tightest connections to and most important customers of the big banks) got the bulk of the relief. https://www.youtube.com/watch?v=EUthicUp0LU At least one big restaurant chain, Shake Shack, has returned its $20 million in forgivable loans, arguing that the true small restauranteurs should be the beneficiaries.
The CARES Act included $500 billion in low cost loans for medium sized and large businesses provided they don’t lay off their workers, buy back their stocks and reward their highest paid executives while the loans are outstanding. The airline industry was promised $50 billion in low cost loans and grants. Negotiations on the first $25 billion in grants to preserve airline industry jobs for pilots and flight attendants and other employees have just concluded successfully. https://www.nytimes.com/2020/04/14/business/coronavirus-airlines-bailout-treasury-department.html Boeing, which made a series of very bad mistakes in manufacturing some of its newest planes and costing passengers their lives, will receive $17 billion in “loans” with virtually no strings attached. This warrants serious oversight, which may not be forthcoming. https://therealnews.com/stories/boeing-billions-loans-coronavirus-cares-act-stimulus Senate Republicans snuck in a $195 billion tax break giveaway to wealthy real estate and hedge fund operators, which Democrats would like to repeal; this was a tax break that Republicans had repealed as part of their tax reforms of 2017. https://theintercept.com/2020/04/19/coronavirus-cares-act-millionaire-tax-break/
There is a big shortage of masks, personal protective equipment, tests and ventilators. The President told the nation’s Governors they were on their own and to go out and cut the best deals they could in the opaque market for these scarce items. The President’s son in law, Jared Kushner, has taken charge of FEMA purchases and deliveries of vital medical supplies and is seizing and redistributing medical supplies from the states and from the local hospitals who contracted for deliveries. https://www.nytimes.com/2020/04/06/us/politics/coronavirus-fema-medical-supplies.html Maybe they are just cutting red tape to get supplies to where they are most needed, or maybe they are playing favorites with those best politically positioned to get to Trump or Kushner’s ear. https://www.salon.com/2020/04/09/house-probes-role-of-jared-kushner-as-federal-government-seizesorders-of-covid-19-medical-supplies/
Prepared by: Lucien Wulsin
Dated: 4.20.20