There’s No Real Oversight Of The $2 Trillion Coronavirus Relief Law

When Congress passed the largest spending law in American history, a $2 trillion outlay aimed at offsetting the economic damage wrought by the coronavirus pandemic, it set up three different ways to look after the enormous sums and root out corruption or mismanagement of the cash.

Three weeks later, none of the three options ― a special inspector general appointed by President Donald Trump, a council of existing inspectors general, or a special oversight panel set up by Congress ― are active. Sabotage by the Trump administration, combined with congressional apathy and gridlock, means the Treasury Department and the Federal Reserve are spending hundreds of millions of dollars with no real watchdogs.

The special inspector general appointed by Trump has views of executive power that have alarmed Democrats, and stands little chance of confirmation until May. Trump shoved aside the leader of the council of existing inspectors general. And the congressional oversight panel’s roster remains unfilled.

Meanwhile, the government program to loan money to small businesses to keep workers on the job has already burned through more than $300 billion, and the Federal Reserve and Treasury Department have unveiled a slew of programs to push trillions more into the economy.

The shambolic state of efforts to oversee the relief efforts has left government accountability advocates dismayed and progressives frustrated with the oversight of a massive spending deal that Democrats and Republican teamed up to pass with almost no objections.

“We can’t really afford to be behind the ball on oversight right now, because we will miss a crucial opportunity to stop waste, fraud and abuse before it happens,” said Liz Hempowicz, director of public policy at the Project On Government Oversight.

Here’s a breakdown of how each part of the oversight triad is failing:

The oversight commission, which is supposed to oversee the $500 billion that Congress handed to the Federal Reserve to help local governments and businesses survive the pandemic, is made up of five members: one appointed by each congressional leader, plus a chairman agreed upon by Senate Majority Leader Mitch McConnell (R-Ky.) and House Speaker Nancy Pelosi (D-Calif.).

Senate Minority Leader Chuck Schumer (D-N.Y.) moved quickly with his pick, naming Bharat Ramamurti, a former aide to Sen. Elizabeth Warren (D-Mass.), to the commission. But the rest of the congressional leaders didn’t name their picks until late on Friday. McConnell picked Sen. Pat Toomey (D-Pa.), a former banker and longtime ally of the financial services industry. House Minority Leader Kevin McCarthy (R-Calif.) picked Rep. French Hill (R-Ark.), another former banker. 

But it was Pelosi’s pick that irritated progressives the most. She selected Rep. Donna Shalala (D-Fla.), citing the first-term, 79-year-old representative’s experience as Health and Human Services secretary under President Bill Clinton.

“Her leadership as Secretary of Health and Human Services will serve the American people extremely well, as she works to ensure that this historic coronavirus relief package is being used wisely and efficiently to protect the lives and livelihoods of the American people, and not be exploited by profiteers and price-gougers,” Pelosi said in announcing the appointment.

But the oversight job has little to do with health care, and Shalala does not serve on the House Oversight or the House Financial Services committees, leading progressives to fear she’ll be outgunned by Toomey and Hill, both of whom have more expertise on financial services issues. Adding to progressives’ frustration is that Rep. Katie Porter (D-Calif.), another Warren protege who serves on both the Oversight and Financial Services committees, was open about her desire for the job. 

“Overseeing the CARES Act is an almost impossible job that requires a ferocious dedication to unearthing the truth, regardless of what powerful bank or corporation wants to keep the truth hidden amidst complex accounting,” said progressive strategist Jeff Hauser, citing scandals during Shalala’s tenure as president of the University of Miami, including an ill-conceived hospital acquisition. “I would have strongly preferred a finance expert skilled at finding financial fraud, like Katie Porter, to someone whose primary experience with complex economic scandals is to try to claim that the buck stopped below her, like Donna Shalala.”

Meanwhile, Pelosi and McConnell have yet to agree on a chair for the commission, though Pelosi on Thursday said the two leaders were exchanging names about whom they could appoint.

The delay, Ramamurti said in an interview not long after his appointment, is troublesome. The commission is required to deliver its first report 30 days after the Federal Reserve begins spending money ― which means it has just under three weeks to organize itself, hire staffers and write an initial report. In the interim, Ramamurti is using his Twitter account to ask questions of the Fed.

“The congressional oversight commission is the only one Trump can’t interfere with directly,” Ramamurti said. “It underscores the importance of this panel and of getting it up and running as quickly as possible.”

Trump moved quickly to nominate a special inspector general, choosing Brian Miller, an associate White House counsel who had formerly served as the inspector general of the General Services Administration. (The GSA, as the agency is known, is essentially the federal government’s office manager, overseeing real estate, the motor pool and other functions.)

But he was even quicker to undermine that inspector general. In a signing statement attached to the law, Trump asserted he could limit what information the new inspector general, who is supposed to oversee a $500 billion Treasury bailout fund, would be able to share with Congress.

Oversight advocates are conflicted about Miller. Most believe he was an effective and fair overseer of the GSA ― his investigations helped force the resignation of the Bush administration’s GSA head in 2008 ―  but more recent comments, indicating he believes that inspectors general have little responsibility to answer to Congress, have worried them. (Inspectors general are somewhat unique in federal law: They’re part of the executive branch but also have an explicit requirement to report to Congress.)

“If you’re reporting to the Congress in that fashion, your independence is jeopardized,” Miller said during a talk at Patrick Henry College, an evangelical college in Virginia. “You’re looking at whatever the political agenda is for the Congress or the Senate, and being used basically as a tool for them.” (Miller’s comments were first reported by The New York Times.)

Hempowicz said Miller’s views on the executive branch are “something the Senate should consider strongly when weighing his nomination.”

Democrats have signaled they’ll oppose Miller’s nomination, noting that he was also part of the White House’s efforts to obstruct Congress during Trump’s impeachment. “A member of the president’s own staff is exactly the wrong type of person to choose for this position,” Schumer said when Trump nominated Miller.

Republicans, with their 53-47 majority in the Senate, could confirm Miller on a party-line vote. But the earliest that vote can happen is May 4, the next time the full Senate is set to meet.

Trump’s most blatant interference with the oversight so far has been his move to oust Glenn Fine, a longtime government watchdog whom the nation’s inspectors general had picked to lead the Pandemic Response Accountability Commission, a collection of IGs who would team up to oversee the spending.

Just three days after the other IGs picked Fine, Trump removed him from his post as the acting inspector general at the Pentagon by picking someone else for the job. While Fine, a well-respected former IG at the Justice Department, simply reverted to his old job as the principal deputy inspector general at the Defense Department, the change in title meant he was no longer eligible to lead the pandemic commission.

Democrats, led by House Oversight Committee Chair Carolyn Maloney (N.Y.), have introduced legislation that would allow Fine to lead the commission anyway, but the proposal is unlikely to become law. And there’s been no clear movement toward picking a new leader for the commission.

Democrats have tried to make political hay out of Trump’s move, one of several he’s taken against inspectors general in recent weeks. He also fired the inspector general for the intelligence community, blaming him for acting on a whistleblower complaint that led to Trump’s impeachment, and criticized an HHS investigator general for a report critical of how the administration handled the run-up to the pandemic. 

Senate Democrats’ campaign arm released a statement pressuring Republican incumbents to speak out against Trump’s move, but few in the president’s own party have made any noise about the issue. During a tele-town hall this week, Sen. Martha McSally (R-Ariz.), who is facing a stiff challenge from Democrat Mark Kelly, brushed off a voter’s question about Fine’s removal.

“I’m not dialed into the Washington, D.C., drama and those things that are happening,” she said during a discussion with voters of Coconino County. “So I can’t speak specifically to that decision and the dynamics behind it.”

McSally added that she was worried about the potential for “abuse or scams or price gouging” with the massive spending law.

“That oversight is really important,” she said.