Jul 9, 2020
Emerging Technologies Washington Update
This week: Coronavirus response; House Democrats seek increased oversight of U.S. Agency for Global Media; technology companies among Paycheck Protection Program loan recipients.
While the Senate remains in recess until July 20, the House is continuing to hold hearings examining various COVID-19-related issues, including its impact on certain sectors and communities and the federal government response. This week, committees looked at issues ranging from increased risks to consumers during the pandemic, examining the national response to the pandemic, exposure notification and contact tracing: how AI helps localities reopen safely and researchers find a cure, challenges for women- and minority-owned businesses accessing capital and financial services during the pandemic and confronting the unequal impacts of COVID-19.
The Administration was focused this week on encouraging schools to reopen for in-person instruction this fall. Secretary of Education Betsy DeVos suggested on Tuesday that schools that do not reopen will not be eligible for federal funding, a sentiment President Trump echoed on Wednesday on Twitter. The President also hosted a roundtable on school reopening on Tuesday. In the meantime, US Immigration and Customs Enforcement (ICE) announced that nonimmigrant F-1 and M-1 students attending schools operating entirely online may not take a full online course load and remain in the United States.
Elsewhere, the Treasury Department and Small Business Administration (SBA) released Paycheck Protection Program (PPP) loan-level data on the 4.9 million loans made to date. The data includes specific data such as business names and addresses for loans over $150,000 and overall statistics on loan dollars per state and distribution by industry, among other data points. The Federal Reserve Bank of Boston also announced the Main Street Lending Program is fully operational and ready to purchase qualifying loans.
As coronavirus cases continue to spike in dozens of states, National Institute of Allergy and Infectious Diseases (NIAID) Director Dr. Anthony Fauci said this week that the current status of the pandemic in the United States is “really not good” and that the country is still “knee-deep in the first wave.” The Department of Health and Human Services (HHS) launched ‘surge’ COVID-19 testing in hotspot jurisdictions in Florida, Louisiana, and Texas as HHS and the Department of Defense (DOD) announced a $1.6 billion agreement with Novavax to demonstrate commercial-scale manufacturing of the company’s COVID-19 investigational vaccine. HHS and DOD also announced a similar agreement with Regeneron for its investigational anti-viral antibody treatment.
The Senate returns to Washington the week of July 20 and Majority Leader McConnell (R-KY) is expected to unveil Senate Republicans’ proposal for Phase 4 coronavirus response legislation shortly thereafter with limited floor time remaining before Congress is scheduled to recess for most of August. Vice President Pence’s Chief of Staff Marc Short reiterated this week that the White House wants Congress to send the President legislation to sign before the recess.
The bill will differ significantly from the House Democrats’ $3 trillion HEROES Act. McConnell has maintained that the package will not exceed $1 trillion, a figure echoed this week by Short. It will also center on liability protections for businesses as the economy continues to reopen. Chief among the disagreements between Republicans and Democrats will be whether to extend the temporary $600/week pandemic unemployment benefits authorized by the CARES Act. Most Republicans oppose this relief as a disincentive to return to work.
The Senate will be in recess next week, but House committees have scheduled a number of COVID-19-related hearings on topics including ICE contractors’ response to the pandemic, capital markets and worker protections, Department of Energy oversight, and federal and state pandemic supply preparedness and response, the importance of transatlantic cooperation during the pandemic, federal investments in technology, and long-lasting solutions for small business recovery.
In Other News
House Democrats Seek Increased Oversight of U.S. Agency for Global Media
On July 3, a group of 11 lawmakers, including House Intelligence Committee members, called on the House Appropriations Committee to take into account the “recent alarming developments regarding the management, Advisory Board, and programs administered by the United States Agency for Global Media (USAGM).” Lawmakers on both sides of the aisle and in both chambers have recently called for greater USAGM oversight.
USAGM administers grants to several independent, non-profit corporations, including the Open Technology Fund (OTF), Radio Free Europe/Radio Liberty, Radio Free Asia, and the Middle East Broadcasting Networks. OTF is charged with promoting a free and open internet through the development of technologies to evade censorship and surveillance. OTF funding provides full life-cycle support for research, development, and implementation of open-source, encryption technologies as well as technologies to circumvent censorship and surveillance conducted by repressive regimes. Additionally, OTF provides emergency support to independent media outlets and journalists who face digital attacks. An example of one of the many projects funded by OTF is the encryption technology Signal, used by over 2 billion people.
The letter calls on appropriators to consider a series of steps, including greater oversight on reprogramming of funds, additional reporting requirements on staffing plans, and fencing portions of the USAGM budget.
Technology Companies Among Paycheck Protection Program Loan Recipients
Amid congressional and public pressure to provide greater transparency into the Paycheck Protection Program (PPP), the Treasury Department and Small Business Administration (SBA) released a large data set on Monday identifying each business receiving more than $150,000 in PPP loans. The data expose some businesses to public scrutiny, particularly in cases where they may appear to not have complied with the spirit or letter of the rules of the program, which were designed to support small and struggling businesses.
Borrowers include a significant number of technology firms, including those in the autonomous vehicle space. Over all, about 50% of the money went to five industries:
- Healthcare and social assistance 12.9%
- Professional and technical services 12.7%
- Construction 12.4%
- Manufacturing 10.3%
- Hotels and food services 8.1%
The $2 trillion CARES Act passed by Congress and signed by President Trump at the end of March established the loan program in order to prop up small businesses impacted by the spread of COVID-19. The loans, the average size of which was $107,000, can be forgiven if borrowers use most of the money to continue paying their employees. The President signed legislation on July 4 to reauthorize lending through August 8.
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