Los Angeles Times - 04.03.2020

(singke) #1

BuSINESS


WEDNESDAY, MARCH 4, 2020:: LATIMES.COM/BUSINESS


C


DOW25,917.41▼785.91 S&P5003,003.37 86.86▼▼NASDAQ8,684.09 268.08 GOLD$1,642.10 49.80▲ OIL$47.18 0.43▲▲EURO$1.1176 .0013 U.S.T-NOTE(10-yr.)1.01% 0.07▼

WASHINGTON — The
Supreme Court appeared
uncertain Tuesday about
whether to give President
Trump and future presi-
dents more power to fire the
heads of semi-independent
agencies, including the Con-
sumer Financial Protection
Bureau, created in the wake
of the Great Recession.
The consumer agency
was created by the Demo-
cratic-controlled Congress
in 2010. To insulate it from
political pressure, the Dodd-
Frank Act said the director
would be appointed by the
president and confirmed by
the Senate to “serve for a
term of 5 years,” and would
be subject to “removal for
cause.” This meant the pres-
ident could “remove the di-
rector for inefficiency, ne-
glect of duty or malfeasance
in office,” but not for purely
political reasons.
The justices struggled
Tuesday with the question
of whether Congress has the
power to structure agencies
as it sees fit, or whether the
president, as head of the exe-
cutive branch, has the power
to exercise day-to-day con-
trol over the top officials of
all executive branch agen-
cies, including the ability to
fire them at will.
Although the court’s five
conservatives tend to favor
greater executive power, it
was not clear Tuesday
whether they agreed among
themselves on how to rule in
this case. Liberal justices are
expected to support Con-
gress’ ability to create semi-
independent agencies.
The dispute began three
years ago when a small Or-
ange County, Calif., law firm
came under scrutiny from
the CFPB on allegations of
charging consumers illegal
upfront fees for debt relief
services. Seila Law not only
disputed the allegation and
refused a demand for docu-
ments, but it also argued
that the consumer bureau it-
self was unconstitutional be-
cause its director was not
subject to control by the
president.
Judge Josephine Staton
in Santa Ana and the U.S.
9th Circuit Court of Appeals
sitting in Pasadena rejected
the constitutional challenge,


Justices


consider


boosting


executive


powers


Court weighs whether


agency officials must


all answer to president


or if some may be


shielded from politics.


By David G. Savage


[SeeSupreme Court,C3]

WASHINGTON — The
Federal Reserve, reacting
swiftly to the coronavirus’
damaging blows to the econ-
omy, announced a sizable in-
terest rate cut Tuesday —
the first such emergency
rate action since the Great
Recession more than a dec-
ade ago.
The Fed’s move — along
with a coordinated global
economic response reminis-
cent of the dark days of the
2007-08 financial crisis —
gave an initial boost to
stocks, with the Dow Jones
industrial average rising al-
most 700 points.
But it fell almost as
quickly, reflecting the depth
of concern about the virus’
potential reach and econo-
mic effect, as well as whether
lower interest rates or other
government actions can
help in the face of the myste-
rious and highly infectious
disease.
The Dow ended the day
down 786 points, a nearly 3%
drop and the ninth decline in
the last 10 trading sessions.
The Fed’s half-point rate
cut marked a dramatic
change from just a week ago,
when Fed officials seemed
content to take a wait-and-
see approach. But since
then, there has been mount-
ing angst in the United
States that the spreading
virus could do serious harm
to the U.S. economy, as it has
in China, where the out-
break began.
Rising numbers of co-
ronavirus cases — and the
first deaths — in the U.S.
have caused increasing
health concerns and deep-
ening pessimism about the
economy. A growing number
of U.S. companies have
warned of lower earnings be-
cause of their exposure to
China and disruptions to
global supply chains, as well
as a slowdown in travel and
tourism.
“We saw a risk to the out-

RATE


CUT


FAILS


TO EASE


FEARS


Market jitters over


virus continue as Fed


takes bold step to


stabilize economy and


prevent downturn.


By Don Lee

[SeeRates, C6]

As the coronavirus threatens to up-
end the travel industry, executives of ho-
tel, airline and cruise ship companies
have been forced to confront sensitive
questions of how to best protect their
customers and employees.
In the growing corner of the travel
world occupied by Airbnb, those issues
are being hashed out one home-rental
host and guest at a time.
On an online message board for hosts,
a man in Mumbai asked what he should
do when he received an inquiry from a
guest coming from China. “I am unsure if
I confirm or cancel the booking,” he
wrote.
A host from Tacoma, Wash., wrote on
the same board that she’s “wiping down
all door knobs, handles, light switches,
and anything else that may have been
touched by the previous guests.” In some
cases, travelers of Asian descent have re-
ported host cancellations they see as dis-
criminatory. And in one posting, a host in
Rome wrote that a guest checked out
“because next door there is a family from
Asia.”
“Two days

A WOMAN browses Airbnb. Guests and hosts are grappling with how to respond to the coronavirus,
prompting cancellations — some of which were discriminatory, some travelers of Asian descent say.

Javier SorianoAFP via Getty Images

As virus spreads, an


Airbnb conundrum


Hosts and guests sort it out one canceled visit at a time


AMID the outbreak, Airbnb says it has discussed best practices
with hosts in some countries. Above, guests in Washington, D.C.

T.J. KirkpatrickWashington Post

By Andrew Khouri

[SeeAirbnb,C5]

Disney faces
disability suits
People with cognitive
problems face long
waits for rides at the
company’s theme
parks, lawsuits say. C2

Telecommuting
to counter virus
JPMorgan Chase asks
thousands of staff to
work from home. It is
testing a possible
coronavirus policy. C2

Intuit deal may
face scrutiny
TurboTax parent’s
$7.1-billion offer to buy
rival Credit Karma
raises antitrust
concerns. C3

Stocks fall; rate
cut adds to fears
The Dow loses 785
points after the Fed’s
emergency action.
Bond yields also end
lower. C3

Until now,
President
Trump’s
approach to
healthcare
was alarm-
ing chiefly to
discrete
populations
such as
low-income families, immi-
grants, people with pre-
existing conditions and
seniors.
They were in the
crosshairs of initiatives to
hamstring Medicaid, pre-
vent undocumented resi-
dents from seeking medical
treatment, destroy the
Affordable Care Act and
raise the cost of Medicare.
But the world has been
changed by the novel co-
ronavirus. Now it’s clear
that all these initiatives
present a healthcare threat
to everyone.
They stand in the way of
comprehensive screening
and treatment for
COVID-19, the disease
caused by the virus.
Trump’s hostility to public
health programs blinds his

administration to how to
use the tools already at
hand to combat the threat.
Precedent exists for using
Medicare to bring expensive
medical services to Ameri-
cans — of any age, not just
65 and older — who can’t
access them any other way.
Will the Trump adminis-
tration get the message? It’s
doubtful.
The administration has
treated proposals for uni-
versal healthcare with unal-
loyed disdain, even though
any such system would give
the government the ability
to fight an emerging pan-
demic such as COVID-19 by
taking over the cost from
states and families. Instead,
officials such as Seema
Verma, director of the Cen-
ters for Medicare and Medi-
caid Services, has gone on
the road to attack proposals
such as “Medicare for all”
and the public option as
“radical socialist ideas.”
Medicaid is perhaps the
prime target of the Trump
healthcare wrecking crew.
The Trump administration
wants to hobble Medicaid
by converting it to a block-

Trump sets U.S. up to fail against virus


MICHAEL HILTZIK

SEEMA VERMA, head of Medicare and Medicaid, two keys to fighting corona-
virus, has attacked “Medicare for all” and called Medicaid “remote” to most of us.

Mandel NganAFP via Getty Images

[SeeHiltzik,C4]
Free download pdf