Washington Insider -- Tuesday

Crisis Civics Lesson

Here’s a quick monitor of Washington farm and trade policy issues from DTN’s well-placed observer.

Benevento Pressed on Small Refiner Waivers in Confirmation Hearing

The Senate Environment and Public Works Committee held a hearing on the nomination of Douglas Benevento to be the EPA Deputy Administrator last week, not surprisingly a session, which saw a lot of focus on the issue of small refinery exemptions (SREs) under the Renewable Fuel Standard (RFS).

The attention of questions focused on the 10th Circuit Court ruling, which declared three SREs granted for the 2016 compliance year were invalid.

Benevento initially sought to address the issue by noting when asked that the court decision had come up about the time his nomination was in the process. “I have not been involved in … a lot of the discussions that -- or any of the discussions that have been happening internal at the agency since then,” he noted on the court ruling. “Moving forward what I can tell you is that I am happy to work with you and other members of the committee and Congress along with the administrator to ensure that we… whatever direction is ultimately determined… we move forward and it is equitable to everybody.”

However, Sen. Joni Ernst, R-Iowa, focused intently on the SRE issue, labeling the court ruling as essentially saying the SREs were “illegal.” She asked Benevento whether he agreed if the court decision was the “law of the land.” When Benevento again tried to indicate the court case came about as nomination was starting to move forward, Ernst said, “can we agree that this is the law of the land right now?” Benevento replied that “it is, yes. It is a 10th Circuit decision and it is binding.”

Asked about the pending 2019 compliance year exemptions by Ernst, Benevento explained that the decision before the administration is a “complex decision” and he said he would happily get back to Ernst in writing. She accepted Benevento’s answer, but cautioned him “guaranteed we will follow up on that.”

Lighthizer Notifies Congress of June 1 Target for USMCA

U.S. Trade Representative Robert Lighthizer has notified the Senate Finance Committee and House Ways & Means Committee that the U.S.-Mexico-Canada Agreement (USMCA) will go into effect June 1.

That comes after Canada’s parliament finally approved the deal Friday.

That sets a tight timeline for regulatory and/or law changes that each country has to make relative to USMCA and then notify each other via an exchange of letters. Indications are actions to start assessing the needed changes have been ongoing since the U.S. ratification of the deal took place and that likely means the timeline could be achievable.

Still it will represent a relatively quick turnaround.

Washington Insider: Crisis Civics Lesson

The COVID-19 pandemic is testing the various levels of the U.S. government in new ways, the Washington Post reported this week, including what governments “can and can’t do.” And, it added that the reality is that the president’s legal authorities in a pandemic are limited and that some of the most important actions probably won’t come from the president — they will come from governors and mayors. It further said that the pandemic will be, to a large extent, “a drama in 51 acts.”

The states and the District of Columbia — not the federal government — decide when to shut schools, shops and other gathering places—and when to reopen them. It’s our governors and mayors — not the president — who will command medical personnel and law enforcement officials on the front lines of emergency responses.

This diffusion of responsibility across the federal government and the 50 states is often called a flaw in the nation’s disaster response infrastructure but Post argues that divided responsibility also leaves us less vulnerable to nationwide failures—and that what we often think is our Achilles’ heel may be our saving grace.

The president can close the borders and impose various restrictions on interstate travel; measures that will be of limited utility now that COVID-19 is present in 49 states and the District. The federal Centers for Disease Control and Prevention, the Food and Drug Administration and the National Institutes of Health will have important roles to play in the development and distribution of testing, treatment and vaccines. But beyond that, the president’s power in a pandemic is largely the power of the bully pulpit.

At the federal level, we now have three declared emergencies related to COVID-19, the Post says. Health and Human Services Secretary Alex Azar declared a “public health emergency” on Jan. 31, and the President declared a “national emergency” and a “Stafford Act emergency” on Friday.

A public health emergency allows HHS to unleash the Strategic National Stockpile, which at last count had 12 million N95 respirators and 30 million surgical masks. That’s a tiny fraction of the 1.7 billion to 7.3 billion respirators and 100 million to 400 million surgical masks CDC experts think we will probably need.

A national emergency gives the president broad authority to take action that would ordinarily require congressional approval. For example, it potentially allows the president to redirect the 37,000-member Army Corps of Engineers toward temporary hospital construction efforts, although the Army Corps’ ranks are modest relative to the hundreds of thousands of civil engineers and construction workers employed by state and local governments.

A Stafford Act emergency declaration meanwhile allows the president to use federal and state resources to supplement state and local emergency response efforts, tapping into money set aside in the federal Disaster Relief Fund. At the end of February, that fund had a balance of $42.6 billion — nothing to sneeze at, but less than 1 percent of the total federal budget, the Post says.

The combination of a public health emergency and at least one of these other two emergencies allows the HHS secretary to waive certain requirements for providers under Medicare, Medicaid and the Children’s Health Insurance Program. It also allows the HHS secretary to make it easier for health-care professionals to work across state lines, for hospitals to transfer patients, for physicians to obtain Medicare reimbursement for telemedicine and for providers to comply with health privacy protections. Those aren’t inconsequential authorities, but they will have, at most, a marginal effect on the overall progress of covid-19.

Contrast those authorities with the sweeping powers that governors and District Mayor Muriel Bowser wield upon declaring an emergency. Maryland law authorizes the governor to issue any “reasonable” order considered "necessary to protect life and property” during an emergency.

For example, Maryland Gov. Larry Hogan, a Republican, who first proclaimed a state of emergency on March 5, on Monday stepped up those efforts to ban gatherings of more than 50 people in close proximity and close bars, restaurants, gyms and movie theaters across the state, the Washington Post reported.

Ohio Gov. Mike DeWine, Illinois Governor J.B. Pritzker and Massachusetts Gov. Charlie Baker — whose state emergency statutes give them similarly broad powers — have used their authority not only to close schools and limit large gatherings but also to clear out bars and restaurants as well.

Governors in some other states have taken less aggressive actions. For example, New York Gov. Andrew Cuomo and California Gov. Gavin Newsom have left school closure decisions to local officials, notwithstanding their clear authority under state law.

Despite advice from public health experts to avoid high-contact settings, Oklahoma Gov. Kevin Stitt, who had been slow to implement statewide measures, the Post says — tweeted (and then deleted) a photograph of him and his family eating at a crowded restaurant Saturday night. He declared a state of emergency on Sunday evening.

Closures of schools, theaters and houses of worship are expected to significantly reduce mortality but deciding how long to shutter these facilities, for example, will require difficult trade-offs between the public health consequences of the outbreak’s spread and the social and economic costs of widespread shutdowns.

For now, social distancing and strict limits on activities are the prudent course, the Post thinks. But Americans won’t stay home forever and it will largely be up to governors and mayors to decide when to relax restrictions. The president was probably wrong when he claimed that COVID-19 “will not have a chance against us.” It could take a heavy toll. But with strong state and local leadership, we may have a fighting chance, the Post says.

So, we will see. This outbreak is a new test of government and likely will be quite difficult to manage as it leaves a trail of economic and social damage. How well the civil organizations function will be extremely important and should be watched closely as the threat continues, Washington Insider believes.

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