Overnight Finance

On The Money: Democrats urge emergency funding for coronavirus | Kudlow says outbreak will have ‘minimal impact’ on economy | Top Dem demands Barr recuse himself from case against Turkish bank

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Happy Tuesday and welcome back to On The Money, where we hope you didn’t wait up for the (partial) results from the Iowa Caucuses. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

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THE BIG DEAL–Democrats urge emergency funding for coronavirus outbreak: House Democrats on Tuesday urged Health and Human Services Secretary Alex Azar to request a package of emergency supplemental funding to deal with the coronavirus outbreak.

House Appropriations Chairwoman Nita Lowey (D-N.Y.) and Labor, Health and Human Services subcommittee Chairwoman Rosa DeLauro (D-Conn.) told Azar in a letter that the funding is needed to stage “an aggressive and comprehensive government-wide response to the 2019 novel Coronavirus, both domestically and internationally.”

Lowey and DeLauro asked the administration to submit the request by Feb. 10.

  • The Centers for Disease Control and Prevention said it is already depleting the $105 million rapid response fund, and on Sunday Azar notified Congress that the department was looking at transferring $136 million from other programs. Azar can only transfer the funds 15 days after notifying Congress, on Monday, February 17.
  • Democrats are seeking additional funding in part to ensure that the administration does not transfer funds from priority programs important to Democrats, such as National Institutes of Health or Head Start programs.

 

ON TAP TOMORROW

 

LEADING THE DAY

Kudlow predicts coronavirus will have ‘minimal impact’ on economy: White House chief economic adviser Larry Kudlow on Tuesday said that he thinks the novel coronavirus will have a minimal impact on the U.S. economy.

“Our estimates are minimal impact. The world is not in Wuhan province,” Kudlow said in an interview with Fox Business Network. He estimated the outbreak could cost the economy 0.2 percent in the first quarter and potentially another 0.2 percent later on.

China’s latest figures on the virus estimated that 20,000 people had been infected, and 425 people had died from it.

But while Kudlow predicted that the virus would not be “catastrophic” for the U.S. economy, he said it could dampen a promised rise in exports to China resulting from last month’s “Phase One” trade deal.

“It is true the trade deal, the phase one trade deal, the export boom from that trade deal will take longer because of the Chinese virus,” he said.

  • Under the terms of the deal, China had promised to increase purchases from the U.S. by $200 billion, but it also said it would do so according to market conditions.
  • Trade experts raised doubts that China would be able to hit that mark even before the outbreak led to quarantines, flight cancellations and some supply chain disruptions.
  • Sectors such as autos and auto parts might be hit harder than pharmaceuticals or chipmakers due to supply chain disruptions, Kudlow added.

 

Top Democrat demands Barr recuse himself from case against Turkish bank: Sen. Ron Wyden (D-Ore.) is calling on Attorney General William Barr to recuse himself from a federal case against a Turkish state-owned bank over concerns President Trump reportedly interfered in the investigation on behalf of Turkey’s president.

Turkey’s Halkbank is accused of transferring billions of dollars to Iran in violation of U.S. sanctions.

The request by Wyden, the top Democrat on the Senate Finance Committee, was detailed in a four-page letter Monday and prompted by reports that Barr raised concerns with former national security adviser John Bolton that Trump was trying to grant personal favors for leaders in Turkey and China.

The alleged conversation between Barr and Bolton was first reported last month by The New York Times, which cited an unpublished book manuscript by Bolton. The Hill’s Laura Kelly explains the case here.

 

GOOD TO KNOW

  • The U.S. Department of Agriculture (USDA) announced Monday that farmers enrolled in a temporary program aimed at helping offset damage they may have incurred from foreign retaliatory tariffs will be receiving their final tranche of federal subsidies.
  • Former Federal Reserve Chair Janet Yellen said Tuesday that increasing political polarization is driving a rise in populism that could weaken the global economy and hinder marginalized people.
  • The House Ways and Means Committee on Tuesday announced that it is set to hold a hearing next week titled “The Disappearing Corporate Income Tax,” as Democrats have expressed concerns about the amount of taxes large companies are paying under President Trump’s 2017 tax-cut law.

 

ODDS AND ENDS

  • Macy’s will close nearly a fifth of its locations as business in malls dwindles.
  • Strong majorities of Democratic, Republican and independent registered voters support a federal cap on interest rates that could pass the House later this year, according to poll results shared Tuesday with The Hill.
  • Patrick Dempsey is set to star in the pilot for a new TV show as a member of Congress secretly working with another across the aisle called “Ways and Means.”
Tags Donald Trump Janet Yellen John Bolton Larry Kudlow Nita Lowey Ron Wyden Rosa DeLauro William Barr

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