Absent Congress Must Do More Oversight than When Present

Newsletter 33: Will Biden or House Dems step up amidst these challenging but critical times?

After a frenzied fortnight of negotiations, the coronavirus stimulus was signed into law late last week. A lot of ink has been spilled and a lot of breath expended criticizing this package (for some of our thoughts see here, here, here, and the extensive set of RDP clips at the bottom of this edition), but none of that was enough to stop it. So with this set of measures a reality, what happens now?

Congressional Oversight

If you’re Mitch McConnell, you go home. The Senate is taking an extended recess apparently under the misguided impression that their work is done. The House is also out and has yet to specify when they will return. 

Normally, we are not ones to disparage the in-district work period but, in these extraordinary times, it hardly seems prudent for lawmakers to be fleeing the District with no plans for remote voting in place and so much unfinished business. That includes passing a fourth stimulus to fill in some of the gaps that the last several have missed. But it also must include oversight of the ongoing train wreck that is the Trump administration’s response to coronavirus.

It is true that Congress has traded away much of its oversight leverage in the past few weeks by quickly coming to the administration’s aid with appropriations and failing to include much in the way of safeguards on how that money is spent. With the cards as they are, there will likely be an even stronger urge than normal for lawmakers to surrender the fight before it gets started. It is essential that they do not.

Congress has inherent oversight powers that, even in the face of this administration’s unprecedented obstructionism, could do a great deal of good in this moment of crisis. As we’ve previously written, coronavirus-related oversight would help to inform new legislation and create pressure for the administration to improve. As it is, a great many Americans seem unaware of just how badly Trump is bungling his response leaving them ill-equipped to demand anything better.  

Lawmakers could, for example, draw attention to the corrupt and incompetent figures who are making the calls. Many Americans would probably care to know that Trump’s choice for Food and Drug Administration (FDA), an agency that will be responsible for approving any coronavirus treatments, has limited government experience and has done a predictably poor job responding to the crisis thus far given his lack of relevant qualifications. They might also be interested in Treasury Secretary Steven Mnuchin’s ties to Goldman Sachs and the real possibility that those relationships could help the bank win a very lucrative gig administering crisis-related programs. 

As important as these figures are, however, oversight cannot be limited to these particularly eye-catching cases. Lawmakers must also closely watch over the administration of their monstrous stimulus package. That includes, to whatever degree possible, the corporate bailout funds, but it must also encompass things like the Small Business Administration’s ability to manage a $350 billion emergency loan program or how the Federal Reserve decided to award BlackRock a contract to administer its new debt-buying program.

This is just a small sampling of the work that lies ahead. Its sheer volume underscores another area of urgent concern: Congress’ funding. The $2 trillion they just passed included very little money for Congress. That means little money for upcoming transitions to telework and maybe, eventually, remote voting. It also means little additional money to tackle oversight of a $2 trillion appropriation. This should be a top priority for the next package.  

In other words, lawmakers’ work is not done; we need them now more than ever. 

2020 (and Potentially 2021)

Of course, no matter how persistent they are, there will only be so much that lawmakers can do before the presidency changes hands. It’s possible that Trump will have been defeated come next January, but some, including seemingly the presumptive Democratic nominee Joe Biden, are mistakenly acting as though that outcome is preordained. Despite bungling the coronavirus response by all objective measures, President Trump is enjoying some of his highest approval ratings of his tenure. Without a coherent political opposition, that could continue. 

This is the time for Joe Biden to be drawing as sharp a contrast as possible with Trump. As the current President makes mistake after mistake, Biden would be smart to state clearly what he would do differently. So far, he has largely offered generalities, not specifics. That approach is failing to get traction. 

People want to know: what can those in power do to help me now? The answer is, a lot. And since Donald Trump won’t take those actions, highlighting these powers makes for a sharp and politically useful contrast. 

Biden could, for example, commit to cancelling all student loans as president (something he has the power to do without input from Congress), thereby underscoring the fact that Trump isn’t. Biden might also draw attention to the ways Trump’s administration is encouraging crisis profiteering among pharmaceutical companies, by promising to put an end to such practices using “march-in” rights. 

As the American people are treated to a seemingly unending string of corrupt and contemptuous appointees who will watch, unconcerned as the country descends into chaos, Biden must seize the opportunity to offer something better. Now is the time for strong personnel commitments. We need competent, public-minded officials to steer us out of this mess and to restore damaged public trust in our governing institutions. That means no industry insiders, no unqualified donors, and no conflicted officials. Can Biden make that promise?

Independent Agencies

With all that has been happening this past month, independent agencies have received even less attention than normal. And we certainly cannot blame anyone for failing to find the time to check up on the Securities and Exchange Commission (SEC) or the Federal Deposit Insurance Corporation (FDIC) these last few weeks. Unfortunately, as our collective attention has been turned elsewhere, many of these agencies have been working double time acceding to corporate America’s demands.  

Earlier this month the National Labor Relations Board (NLRB) announced that it was putting all union elections on hold through at least April 1. This move effectively grinds new union formation to a halt. Elsewhere, the FDIC was busy approving shady new banks. In a vote earlier this month, the agency allowed the student loan servicer, Nelnet, and the technology company Square, to become banks. Meanwhile, the Commodity Futures Trading Commission (CFTC) came to Capital One’s aid last week after some oil and gas investments (predictably) ran into trouble.

These examples point to a deeper, more troubling trend. As the world struggles to manage coronavirus, corporate incursions at obscure regulatory agencies are likely to accelerate, not slow down. It is important that civil society and, most importantly, lawmakers remain vigilant to ensure corporate America doesn’t make off with the spoils while we’re not looking. 

Want more?Check out some of the pieces that we have published or contributed research or thoughts to in the last couple of weeks:

SEC Must Build Public Trust in Government by Policing Federal Officials' Crisis Profiteering 

Trump Stimulus Plan: Still Getting Everything Wrong 

Good Government Groups Demand SEC Investigate Sen. Richard Burr for Insider Trading 

Progressives Are Divided On What To Do About Coronavirus Bailouts For Big Business

What's The Best Way To Boost The Economy In A Pandemic?

Unsanitized: Bailouts, A Tradition Unlike Any Other

The stimulus package is a missed opportunity for American workers

Major hotel executive: "I've just cut 95% of my staff"

Law Prof’s Optimistic COVID-19 Death Toll Prediction Circulated Through the White House. It’s Already Wrong.

Critics Warn Democrats That Mere 'Oversight' of $500 Billion Corporate Bailout 'Much Too Weak' to Stop Trump Abuses

Coronavirus relief package includes aid for just about everyone, including California interests

‘There’s no playbook for this’: Biden trapped in campaign limbo

Right-to-Work Advocates Drive a Wedge Between Unions and Workers

Trump’s Reelection May Hinge On The Economy — And Coronavirus

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