Trump now has total control of vast virus-aid fund

It used to be said that beggars can’t be choosers. That obviously no longer applies in the U.S. of today

Published March 31, 2020 7:30AM (EDT)

 (Getty/Nicholas Kamm)
(Getty/Nicholas Kamm)

This article originally appeared on The Globalist.

The biggest slush fund in history is now at the disposal of the United States Treasury. Owing to its gargantuan size and very loose oversight rules, the new $2.2 trillion law — the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) could unleash unprecedented fraud and abuse.

Trump as RIC — Rigger in Chief?

Two critical issues of presidential power have immediately surfaced as the U.S. government moves to disburse staggering sums of cash and authorize vast credit lines to almost all sectors of the economy.

Despite some safeguards written into the law, in an astonishingly brazen move, President Trump wiped them aside by virtue of his signing statement.

First, the President clearly wants to control the major disbursements, especially to business, despite the letter of the new law. Second, the President aims once again to challenge Congress's power and use the Justice Department to undermine the will of the U.S. Congress.

Executive privilege

One of the most important safeguards sees the appointment of a Special Inspector General for Pandemic Recovery (SIGPR) to be appointed to monitor the U.S. Treasury's disbursement of $500 billion in aid to corporations.

Trump, noting that the law says the SIGPR should submit reports "without delay" to Congress, stated: "I do not understand, and my Administration will not treat, this provision as permitting the SIGPR to issue reports to the Congress without presidential supervision."

Trump: Denying Congress's power of the purse

In yet another clear sign of seeing itself as an imperial presidency, the White House is taking the view that the SIGPR, who will be nominated by the President, is part of his administration and therefore his work is subject to executive privilege. 

The Justice Department rushed to draft a "Signing Statement" to support this controversial contention in time for the President to issue as he approved the new law.

And the President explicitly used the same argument to declare that reports by a new group, the Pandemic Response Accountability Committee, composed of Inspector-Generals representing a wide range of government departments and agencies, will also have to go through the White House first before reaching Congress.

The President's campaign slush fund

It is no exaggeration to say that this is not madness,but method. Donald Trump and his campaign team may well consider the new CARE Act as a golden opportunity to parcel out campaign favors.

Where ever that money will come in handy to win a race or a state, one can rest assured that Donald Trump and his Republicans are prepared to spend it for their own benefit.

Countering safeguards

Even this misshapen result is a minor success for the Democrats. They can claim to have prevented worse. After all, Mr. Trump initially wanted total authority over how to use the funds.

But Democrats in Congress blocked that initial draft legislation because it lacked safeguards and independent inspections. Then, the President appeared to accept the new constraints in order to get the law passed swiftly.

But all along, never a man to live up to the standards of American bipartisanship, Mr. Trump's Justice Department was working to draft arguments to undermine those safeguards.

Why did the Democrats cave?

In normal times, this would have sparked a battle royal. In normal times, Nancy Pelosi, Speaker of the House of Representatives and the most powerful woman in U.S. political history, would be decrying this deceit.

But everyone is under a lockdown. Members of Congress have fled Washington D.C. for their homes, with no plans to return soon. The Democrats could simply not afford for no law to pass. 

Poker, Mafia-style

True, the law should have included more safeguards to ensure that the beneficiaries of the government's hand-outs are businesses with genuine, critical needs. True as well, there are no such safeguards.

Boeing, which claimed to be in a highly distressed state and lobbied hard for special assistance, and which has been assured of large new credits, now says that it will only take the cash if conditions are not too stringent.

It used to be said that beggars can't be choosers. That obviously no longer applies in the United States of today. Corporations set the terms of their bailouts.

They insist on no interference or involvement in any form by the government in its affairs. Trump is likely to approve support for Boeing with as few strings as possible.

A familiar pattern: Supporting corporations, not families

Under those circumstances, there is a danger that the cash will go to companies with the greatest political influence and access, not necessarily to those with the greatest need

Scholars at the Economic Policy Institute worry that we may see a repeat of what happened in the financial crisis when, they assert, "far too much of the money went to support financial firms and far too little went to support typical families."

To be sure, many American families will get some of the cash from this vast new public spending plan — but the poorest Americans may well be suffering the most and have the least meaningful assistance.

And The Project on Government Oversight (POGO)stresses there is a great need for "whistleblowers on the front lines of this crisis to be able to ring the alarm on waste, illegality and dangers to public health and safety."

Selling the American people yet another hoax

In his familiar mix of self-congratulatory bravado and chutzpah, Donald Trump has stated that the Treasury will be advised on how best to disburse funds by: "People who can work this out — I am getting the most brilliant financial minds in the world from Wall Street."

That will hardly comfort the afflicted. All the more so as Donald Trump has been slow to fill vacancies among the Inspector-Generals. As stated earlier, there is a method behind his madness.

At this critical time, there is no confirmed chief Inspector General (IG) at the Department of Health and Human Services. The President can be relied upon to move slowly to appoint the mandated special IG for the Treasury. Who knows when the U.S. Senate will return to confirm the nominee?

Meanwhile, the cash will rush out of the Treasury, with much of it going through Wall Street.

The courts will decide – when it's too late

As to the President's war with Congress over executive privilege, this is just one more battle.

Eventually, the courts will decide, but very likely only after the election. No doubt, on the road for what he clearly sees as his path to re-election, Trump will see to it that the emergency cash will have been disbursed to the juicy targets.

No doubt, either, that Mr. Trump expects the beneficiaries of his largesse to be campaign props for his re-election in the run-up to November 3, 2020.


Mr. Trump can rightfully claim that he did not exactly hide his pro-corporate, anti-family brazenness. And he can also claim that, despite all these moves, his poll ratings improved along the way.

The American people seem fully prepared to buy into Trump's political style, which is to sell madness as method.

This article is republished from The Globalist: On a daily basis, we rethink globalization and how the world really hangs together.  Thought-provoking cross-country comparisons and insights from contributors from all continents. Exploring what unites and what divides us in politics and culture. Follow us on Facebook and Twitter.  And sign up for our highlights email here.

By Frank Vogl

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