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Pentagon Redirected Coronavirus Response Funds to Defense Contractors, WaPo Reports

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  • In March, Congress gave the Pentagon $1 billion under the Cares Act to help the country prepare and respond to the coronavirus. 
  • However, according to a Washington Post report, rather than using the money to build up the nation’s supply of medical equipment, the Pentagon funneled the majority of the funds to defense contractors and used it for making things like jet engine parts, body armor, and dress uniforms. It even gave funds to companies that had already received assistance from the Paycheck Protection Program.
  • The report comes as healthcare officials continue to ask for more funding and medical equipment. Congress even criticized the Defense Department for not using the money as intended. 
  • Still, the Pentagon argues that the funds are crucial to niche manufacturers that have been impacted by the pandemic. It’s also asking for an additional $11 billion in the next stimulus package.

The Funds 

The Washington Post released a new report Tuesday highlighting how the Pentagon redirected taxpayer money meant for coronavirus response efforts.

Back in March, Congress gave the Pentagon $1 billion under the Cares Act to “prevent, prepare for, and respond to coronavirus.”  The fund was allocated under the Defense Production Act, which allows the president to compel U.S. companies to assist in producing items deemed essential to the national interest. 

After the money was allocated, however, the Department of Defense began reshaping how it would give out the funds in a way that deviated from what Congress had intended. Lawyers for the department concluded that the money could be used for defense production, including projects that had little to do with responding to the pandemic.

So rather than use that money to build up the nation’s supply of medical equipment, the report says the Pentagon funneled the majority of the funds to defense contractors and used it for making things like jet engine parts, body armor, and dress uniforms. 

For example, Firms like Rolls-Royce and ArcelorMittal received $183 million to “maintain the shipbuilding industry.” Tens of millions of dollars were given for space surveillance, drone and satellite technology.

According to the Post, $80 million was given to a Kansas aircraft parts business that was “suffering from the Boeing 737 Max groundings and the global shutdown of air travel,” and around $2 million was awarded to a domestic manufacturer of Army dress uniform fabric. 

The newspaper also reported that at least 10 of the 30 companies that received assistance from the Defense Department had also received loans through the Paycheck Protection Program. That program allocated billions of dollars in forgivable loans to the small businesses impacted by the coronavirus pandemic.

This news made critics even more frustrated because it seemed to once again show how bailout funds have been handed out unfairly in certain sectors of the economy. 

For instance, the company Weber Metals received between $5 million and $10 million through the PPP in April to support 412 jobs, then it got an extra boost through a $25 million Department of Defense relief award in June. 

When pressed about this, a Defense Department spokesperson told the paper that the two bailout programs are not “in conflict or duplicative,” because a PPP loan does not make any directive with respect to supporting national defense.

Still, the Post notes that the Trump administration has done little to limit defense firms from accessing multiple bailout funds at once. He’s also not requiring the companies to refrain from layoffs as a condition of receiving the awards.

COVID Relief Money Still Needed 

This news comes as health officials across the U.S. continue to request funding for pandemic response efforts. In his Senate testimony just last week, CDC director Robert Redfield said states desperately need $6 billion to distribute vaccines to Americans early next year. On top of that, reports of severe N95 mask shortages at hospitals around the country have continued to emerge. Both are precisely the types of issues that the money was meant to help address.

The Washington Post notes that the $1 billion is just a fraction of the $3 trillion in emergency spending that Congress approved earlier this year. Still, it shows how in many cases, the money is redirected to firms that weren’t originally targetted for assistance. 

It also shows how hard it is for Congres to track how this money is spent and intervene when changes are made. 

The Pentagon did initially plan to spend the bulk of the fund on medical supplies. In April, Ellen Lord, undersecretary of defense for acquisition and sustainment, told reporters that three-quarters would go toward medical resources and the rest to defense contractors.

Then in June, she told lawmakers during a congressional hearing that the department realized defense contractors had “critical needs as well.”

According to the report, DOD lawyers approved an arrangement where some $17 billion in Health and Human Services funding would be used for the medical industry instead, freeing up more money for defense contractors. Ultimately, the Pentagon presented a spending plan to Congress in June that set aside $688 million for the defense industry.

So essentially the Defense Department claims that the funds are crucial to niche manufacturers that need production from the economic instability caused by the pandemic. Like companies that make aircraft parts for military and commercial jets, for instance. They’ve been pretty impacted by the slowdown of air travel. 

Lord told the Post that her office had worked closely with Congress to meet the needs of both the medical and defense industries.

“We are thankful the Congress provided authorities and resources that enabled the [executive branch] to invest in domestic production of critical medical resources and protect key defense capabilities from the consequences of COVID,” she added.

“We need to always remember that economic security and national security are very tightly interrelated and our industrial base is really the nexus of the two.”

However, the Democratic-leading House Committee on Appropriations has made it clear that the Defense Department has not distributed the money as intended under the Cares Act.

The committee wrote in its report on the 2021 defense bill, “The Committee’s expectation was that the Department would address the need for PPE industrial capacity rather than execute the funding for the DIB (defense industrial base).”

The Pentagon has countered that it has been fully transparent with Congress about its plans.  Still, the Post notes that the $1 billion in coronavirus funds came at a time when U.S. military spending was already near all-time highs.

According to the report, “the $686 billion defense budget for fiscal year 2019 is comparable to a typical year during the Cold War or the period shortly after 9/11, although it has declined somewhat as a percentage of the economy.”

It also notes that some of the major defense contractors have remained financially healthy despite all the pandemic related disruptions and have continued to pay stock dividends to investors.

Though its already given out millions, the Pentagon is requesting an additional  $11 billion in a potential new stimulus.

See what others are saying: (CNN) (The Washington Post) (The Hill) 

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New COVID-19 Variant Could Become Dominant in the U.S. by March, CDC Warns

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  • The CDC warned Friday that a new highly transmissible COVID-19 variant could become the predominant variant in the United States by March.
  • The strain was first reported in the United Kingdom in December and is now in at least 10 states.
  • The CDC used a modeled trajectory to discover how quickly the variant could spread in the U.S. and said that this could threaten the country’s already overwhelmed healthcare system.

CDC Issues Warning

The Centers for Disease Control and Prevention warned Friday that the new COVID-19 variant could become the predominant variant in the United States by March.

While it is not known to be more deadly, it does spread at a higher rate, which is troubling considering the condition the U.S. is already in. Cases and deaths are already on the rise in nearly every state and globally, 2 million lives have been lost to the coronavirus. 

The variant was first reported in the United Kingdom in mid-December. It is now in 30 countries, including the U.S., where cases have been located in at least ten states. Right now, only 76 cases of this variant have been confirmed in the U.S., but experts believe that number is likely much higher and said it will increase significantly in the coming weeks. It is already a dominant strain in parts of the U.K.

Modeled trajectory shows that growth in the U.S. could be so fast that it dominates U.S. cases just three months into the new year. This could pose a huge threat to our already strained healthcare system.

Mitigating Spread of Variant

“I want to stress that we are deeply concerned that this strain is more transmissible and can accelerate outbreaks in the U.S. in the coming weeks,” said Dr. Jay Butler, deputy director for infectious diseases at the CDC told the New York Times. “We’re sounding the alarm and urging people to realize the pandemic is not over and in no way is it time to throw in the towel.”

The CDC advises that health officials use this time to limit spread and increase vaccination as much as possible in order to mitigate the impact this variant will have. Experts believe that current vaccines will protect against this strain.

“Effective public health measures, including vaccination, physical distancing, use of masks, hand hygiene, and isolation and quarantine, will be essential,” the CDC said in their report.

“Strategic testing of persons without symptoms but at higher risk of infection, such as those exposed to SARS-CoV-2 or who have frequent unavoidable contact with the public, provides another opportunity to limit ongoing spread.”

See what others are saying: (Wall Street Journal) (New York Times) (NBC News)

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Former Michigan Gov. and 8 Others Charged Over Flint Water Crisis

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Michigan Gov. Rick Snyder. (Al Goldis/AP)

  • Ex-Michigan Gov. Rick Snyder was charged with two counts of willful neglect of duty Wednesday for his role in the Flint water crisis
  • By Thursday, eight more former state and city officials were charged with crimes ranging from involuntary manslaughter to extortion.
  • Flint residents have long awaited this news. In 2019, prosecutors dropped all criminal charges against 15 officials and said they would start the investigation from scratch, citing concerns about how the special counsel had conducted its probe.

Rick Snyder Charges

Michigan Attorney General Dana Nessel’s office said Thursday that it had filed 41 charges against nine former state and city officials for their role in the Flint water crisis.

The most high-profile figure to be charged was former Michigan Gov. Rick Snyder. On Wednesday, he was hit with two counts of willful neglect of duty.

He was the state’s top executive when local officials decided to switch the city’s drinking water source to the Flint River in 2014.

The switch was supposed to be a temporary cost-saving measure while a pipeline was being built to Lake Huron. However, the water wasn’t treated properly for corrosion, so lead-contaminated water was released into the homes of people all over the city. Because of that, 12 people died and at least 90 were sickened with Legionnaires’ disease.

Snyder appeared in court this morning via Zoom, pleading not guilty to the two misdemeanor charges. If convicted he could face up to a year in prison and as much as a $1,000 fine.

His charges alone are significant because they make him the first governor or former governor in the state to ever be charged with a crime for alleged conduct while in office.

8 Others Charged

Along with Snyder, eight others were charged, including a former state health director Nick Lyon. Lyon received nine charges of involuntary manslaughter, among others.

Richard Baird, one of Snyder’s closes advisors was changed for extortion, perjury, and obstructions of justice. Others who were charged include:

  • Jarrod Agen, Snyder’s former chief of staff and Vice President Mike Pence’s former communications director.
  • Dr. Eden Wells, a former chief medical executive for the state Department of Health and Human Services. 
  • Darnell Earley, former Flint finance director and state-appointed emergency manager.
  • Gerald Ambrose, former state-appointed emergency manager.
  • Howard Croft, former Flint Public Works Director.
  • Nancy Peeler, the state’s director of maternal, infant and early childhood home visiting for the health department.

Flint residents have waited a long time for justice over the water contamination issue. Prosecutors previously dropped all 15 criminal charges tied to the Flint case in 2019 and said the investigation would begin again from scratch.

At the time, they cited concerns about how the special counsel had conducted its probe.

It also wasn’t until last year that the state reached a $600 million settlement with victims, establishing a fund from which residents can file for compensation.

See what others are saying: (NPR) (The Detroit News) (Detroit Free Press)

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Three Lawmakers Test Positive for COVID-19 Following Capitol Attack

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  • At least three Congressmembers have tested positive for COVID-19 following Wednesday’s pro-Trump attack on the Capitol. 
  • Rep. Bonnie Watson Coleman (D-NJ), Rep. Pramila Jayapal (D-Wash.), and Rep. Brad Schneider (D-Ill.) believe they contracted the virus after locking down in close quarters with numerous Republican lawmakers who refused to wear masks.
  • Jayapal and Schneider are calling for those who did not wear a mask to face consequences.

Rep. Bonnie Watson Coleman Tests Positive

At least three members of Congress have tested positive for COVID-19 after locking down in close quarters with other House members during Wednesday’s pro-Trump attack on the Capitol. 

Congress’ attending physician, Brian Monahan, warned that members may have been exposed during the lockdown. He recommended that everyone who was isolated inside should get tested for the virus. 

On Monday Rep. Bonnie Watson Coleman (D-NJ) became the first to announce that she tested positive. Watson Coleman believes she was exposed while in the Capitol lockdown. In her statement, she cited the multiple Republicans who refused to wear masks while inside. Video footage from Punchbowl News shows a Democratic lawmaker handing out masks and a handful of Republicans declining to take one. 

Watson Coleman is a 75-year-old lung cancer survivor. While she said she is only experiencing cold-like symptoms, she tweeted that per a doctor’s suggestion, she headed to a local hospital for antibody treatment. She also encouraged those who sheltered in place to get tested. 

More Cases Follow

Later on Monday, Rep. Pramila Jayapal (D-Wash.) said she too had tested positive, also blaming a lack of mask-wearing in the Capitol. In a lengthy Twitter thread, she said Republicans created a superspreader event and demanded consequences for their actions. 

Many Republicans still refused to take the bare minimum COVID-19 precaution and simply wear a damn mask in a crowded room during a pandemic—creating a superspreader event ON TOP of a domestic terrorist attack,” she wrote. 

“Any Member who refuses to wear a mask should be fully held accountable,” Jayapal added. 

“I’m calling for every single Member who refuses to wear a mask in the Capitol to be fined and removed from the floor by the Sergeant at Arms.”

Rep. Brad Schneider (D-Ill.) echoed her frustrations on Tuesday after releasing a statement saying he has become the third House member to have tested positive following the lockdown. 

“Today, I am now in strict isolation, worried that I have risked my wife’s health and angry at the selfishness and arrogance of the anti-maskers who put their own contempt and disregard for decency ahead of the health and safety of their colleagues and our staff,” he wrote.

Like Jayapal, he is calling for sanctions against those who opted to not wear masks. 

Many health officials feared that this lockdown could lead to a surge in cases. They also worry that the mob itself could lead to a superspreader event as most of those who attacked the Capitol were not wearing masks and were crowding together both inside and outside of the building.

See what others are saying: (The Washington Post) (NPR) (NBC Chicago)

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