Coronavirus: The Hill and the Headlines – COVID-19 D.C. Update – September # 18

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Your guide to the latest Hill developments, news narratives, and media headlines from Hogan Lovells Government Relations and Public Affairs practice.

In Washington:

  • House Speaker Nancy Pelosi (D-CA) and Treasury Secretary Steven Mnuchin were unable to come to an agreement on a coronavirus relief deal after meeting Wednesday afternoon. The Speaker says the House will move forward with a vote today on their $2.2 trillion HEROES 2.0 bill but noted that she and Mnuchin will continue to talk. The administration countered the Democrats' $2.2 trillion with an amount near the $1.5 trillion Problem Solver’s legislative proposal. Mnuchin’s offer also included an “escalator clause” that would increase the topline to $2 trillion which was hoped to entice Democrats to accept the proposal. Pelosi told her caucus that state and local aid and liability reform are two of the outstanding issues this morning during a call. This afternoon, Pelosi said she and Mnuchin had an “extensive conversation” and found areas where they are “seeking further clarification” but will continue to hold conversations. Secretary Mnuchin agreed that there was a lot of progress but “have more work to do.”
  • President Trump contradicted and discredited his health experts on when a coronavirus vaccine will be available during the Tuesday night’s presidential debate. Trump insists that a vaccine will be available by the elections. Moderator Chris Wallace noted that the Center for Disease Control and Prevention (CDC) Director Robert Redfield and Dr. Moncef Slaou Swali, head of Operation Warp Speed, both say that it will not be until the summer of 2021 that a vaccine would generally be available to the public. Trump says that the scientists' estimates were a “political thing” and he disagreed with them. Many experts have also noted that the timeline for testing will have to expand to allow for the testing of children.
  • The President also promised that the government will distribute 200,000 COVID-19 vaccinations a day during the debate. But health experts point out that at that pace vaccinating the entire country would take nearly five years. “We have the military all set up. Logistically, they’re all set up. We have our military that delivers soldiers, and they can do 200,000 a day. They’re going to be delivering the vaccine.”
  • The Treasury Department announced on Tuesday that it has closed the loans under its payroll support and loan programs to seven large passenger air carriers under the CARES Act. The reallocation of funds will be subject to a loan concentration limit of $7.5 billion per passenger air carrier, or 30 percent of the $25 billion available for passenger air carriers. The seven air carriers are Alaska Airlines, American Airlines, Frontier Airlines, JetBlue Airways, Hawaiian Airlines, SkyWest Airlines, and United Airlines.
  • Dallas Federal Reserve Bank President Robert Kaplan told CNBC on Wednesday that he favors keeping interest rates near zero “for the next probably 2½ to three years” to aid the economic recovery from the COVID-19 pandemic. Kaplan’s comments are in line with Fed action. Earlier this month, the Fed’s policy-making committee voted to keep short-term rates targeted at zero to 0.25 percent and indicated they would remain there until inflation rises consistently.
  • Operation Warp Speed, the federal government’s crash program to develop a COVID-19 vaccine, is awarding billions of dollars' worth of contracts to companies through a private company, bypassing oversight and transparency rules, NPR reports. Rather than contracting directly with vaccine makers, more than $6 billion has been routed through a defense contract management firm called Advanced Technologies International, Inc., or ATI. ATI then awards contracts to companies working on vaccines. As a result, the contracts between the pharmaceutical companies and ATI may not be available through public records requests and other documents are exempt from public disclosure for five years. Vaccine contracts awarded this way include $1.6 billion for Novavax, $1.95 billion for Pfizer, $1.79 billion for Sanofi, and $1 billion for Johnson & Johnson. A senior administration official defended the bypass method as lawful.
  • The Department of Commerce reported Wednesday that GDP dropped 31.4 percent in spring but expects to see a “big rebound.” Commerce had estimated a 31.7 drop one month ago. Economists believe the economy will expand at an annual rate of 30 percent in the current quarter.

In the News:

  • A Robert Wood Johnson Foundation and the Harvard T.H. Chan School of Public Health poll released on Wednesday shows that 60 percent of households with children across the country have lost jobs, or businesses, or have had wages reduced during the pandemic.
  • The NFL has postponed Sunday’s game between the Tennessee Titans and Pittsburgh Steelers after four Titan’s players tested positive for COVID-19.
  • Scientists are racing to learn more about the damage that coronavirus can do to the heart, lungs, and brain, as it is becoming clear that coronavirus is affecting the long-term health of people infected. Conditions such as pneumonia and scar tissue can add to long-term breathing problems. Researchers are also finding evidence of the virus in parts of the brain, kidneys, and gastrointestinal tract, in the cells that line blood vessels, and in clotting in organs. Widespread problems with the blood vessels could lead to a global surge in vascular diseases.
  • The Walt Disney Company announced on Tuesday that it is laying off 28,000 workers from its Parks, Experiences, and Products division. Of the 28,000 employees affected, 67 percent are part-time. Disneyland Paris, Hong Kong Disneyland, Shanghai Disney, and Disney World in Florida are open, with safety protocols in place. Disneyland in Anaheim remains closed. In August, Disney reported a loss of $4.7 billion in its third quarter.
  • A student attending Appalachian State University in North Carolina died after developing complications from the coronavirus, university officials announced on Tuesday. The 19-year-old was diagnosed with the coronavirus earlier in September. A New York Times database has logged over 130,000 coronavirus cases and at least 70 deaths on college campuses since the beginning of the pandemic, though that number is likely an undercount.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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