On Thursday, analysts spotlighted the news that the White House and congressional Democrats were moving toward dropping corporate tax increases they had wanted to include in the bill, as they hoped to forge a deal that could clear the Senate. A spending deal without corporate tax increases would be a potential boon to profits and share prices.
“A stay of execution on higher corporate tax rates would seem a potentially noteworthy development,” Daragh Maher, a currency analyst with HSBC Securities, wrote in a note to clients on Thursday.
An agreement among Democrats on what’s expected to be a roughly $2 trillion spending plan would also open the door to a separate $1 trillion bipartisan infrastructure plan moving through Congress. Progressives in the House are blocking the infrastructure bill until agreement is reached on the larger bill.
But the prospects for an agreement have helped to lift shares of major engineering and construction materials companies. Terex, which makes equipment used for handling construction materials like stone and asphalt, has jumped more than 5 percent this week. The asphalt maker Vulcan Materials has risen more than 4 percent. Dycom, which specializes in construction and engineering of telecommunication networking systems, was up more than 9 percent.
The renewed confidence remains fragile, with good reason. The coronavirus continues to affect business operations around the world, and the Delta variant demonstrated just how disruptive a new iteration of the virus can be.
Another lingering concern involves the higher costs companies face for everything from raw materials to shipping to labor. If they are unable to pass those higher costs on to consumers, it will cut into their profits.
“That would be big,” Mr. McKnight said. “That would be a material impact to the markets.”
But going into the final months of the year — traditionally a good time for stocks — the market also has plenty of reasons to push higher.
The recent weeks of bumpy trading may have chased shareholders with low confidence — sometimes known as “weak hands” on Wall Street — out of the market, offering potential bargains to long-term buyers.
“Interest rates are relatively stable. Earnings are booming. Covid cases, thankfully, are dropping precipitously in the U.S.,” Mr. Zemsky said. “The weak hands have left the markets and there’s plenty of jobs. So why shouldn’t we have new highs?”
WASHINGTON — The chief executive of Emergent BioSolutions, whose Baltimore plant ruined millions of coronavirus vaccine doses, disclosed for the first time on Wednesday that more than 100 million doses of Johnson & Johnson’s vaccine are now on hold as regulators check them for possible contamination.
In more than three hours of testimony before a House subcommittee, the chief executive, Robert G. Kramer, calmly acknowledged unsanitary conditions, including mold and peeling paint, at the Baltimore plant. He conceded that Johnson & Johnson — not Emergent — had discovered contaminated doses, and he fended off aggressive questions from Democrats about his stock sales and hundreds of thousands of dollars in bonuses for top company executives.
Emergent’s Bayview Baltimore plant was forced to halt operations a month ago after contamination spoiled the equivalent of 15 million doses, but Mr. Kramer told lawmakers that he expected the facility to resume production “in a matter of days.” He said he took “very seriously” a report by federal regulators that revealed manufacturing deficiencies and accepted “full responsibility.”
“No one is more disappointed than we are that we had to suspend our 24/7 manufacturing of new vaccine,” Mr. Kramer told the panel, adding, “I apologize for the failure of our controls.”
Federal campaign records show that since 2018, Mr. El-Hibri and his wife have donated more than $150,000 to groups affiliated with Mr. Scalise. The company’s political action committee has given about $1.4 million over the past 10 years to members of both parties.
Mr. El-Hibri expressed contrition on Wednesday. “The cross-contamination incident is unacceptable,” he said, “period.”
Mr. Kramer’s estimate of 100 million doses on hold added 30 million to the number of Johnson & Johnson doses that are effectively quarantined because of regulatory concerns about contamination. Federal officials had previously estimated that the equivalent of about 70 million doses — most of that destined for domestic use — could not be released, pending tests for purity.
confidential audits, previously reported by The Times, that cited repeated violations of manufacturing standards. A top federal manufacturing expert echoed those concerns in a June 2020 report, warning that Emergent lacked trained staff and adequate quality control.
“My teenage son’s room gives your facility a run for its money,” Representative Raja Krishnamoorthi, Democrat of Illinois, told Mr. Kramer.
Mr. Kramer initially testified that contamination of the Johnson & Johnson doses “was identified through our quality control procedures and checks and balances.” But under questioning, he acknowledged that a Johnson & Johnson lab in the Netherlands had picked up the problem. Johnson & Johnson hired Emergent to produce its vaccine and, at the insistence of the Biden administration, is now asserting greater control over the plant.
The federal government awarded Emergent a $628 million contract last year, mostly to reserve space at the Baltimore plant for vaccine production. Among other things, lawmakers are looking into whether the company leveraged its contacts with a top Trump administration official, Dr. Robert Kadlec, to win that contract and whether federal officials ignored known deficiencies in giving Emergent the work.
Mr. El-Hibri told lawmakers that the government and Johnson & Johnson were aware of the risks.
“Everyone went into this with their eyes wide open, that this is a facility that had never manufactured a licensed product before,” he said. While the Baltimore plant was “not in perfect condition — far from it,” he argued that the facility “had the highest level of state of readiness” among the plants the government had to choose from.
the coronavirus leaked from a laboratory in China, the “lies of the Communist Party of China,” mask mandates and the Biden administration’s call for a waiver of an international intellectual property agreement.
“You are a reputable company that has done yeoman’s work to protect this country in biodefense,” exclaimed Representative Mark E. Green, Republican of Tennessee, adding, “So you gave your folks a bonus for their incredible work.”
Emergent is skilled at working Washington. Its board is stocked with former government officials, and Senate lobbying disclosures show that the company has spent an average of $3 million a year on lobbying over the past decade. That is about the same as two pharmaceutical giants, AstraZeneca and Bristol Myers Squibb, whose annual revenues are at least 17 times higher.
Democrats pressed Mr. Kramer and Mr. El-Hibri about their contacts with Dr. Kadlec, who previously consulted for Emergent. Documents show that Emergent agreed to pay him $120,000 annually between 2012 and 2015 for his consulting work, and that he recommended that Emergent be given a “priority rating” so that the contract could be approved speedily. Dr. Kadlec has said he did not negotiate the deal but did sign off on it.
“Did you or any other Emergent executives speak to or socialize with Dr. Kadlec while these contracts were being issued?” Representative Nydia M. Velázquez, Democrat of New York, asked Mr. Kramer.
“Congresswoman,” he replied carefully, “I did not have any conversations with Dr. Kadlec about this.”
A Times investigation found that Emergent has exercised outsize influence over the Strategic National Stockpile, the nation’s emergency medical reserve; in some years, the company’s anthrax vaccine has accounted for as much as half the stockpile’s budget.
The investigation found that some federal officials felt the company was gouging taxpayers — an issue that also came up at Wednesday’s hearing when Representative Carolyn B. Maloney, Democrat of New York, demanded to know how much it cost to make the vaccine and what it sold for. Mr. El-Hibri promised to supply the information later.
Company executives also view their coronavirus work as one of the “prime drivers” of its 2020 revenues, according to a memorandum released on Wednesday by committee staff members. The executives were rewarded for what the company’s board called “exemplary overall 2020 corporate performance including significantly outperforming revenue and earnings targets.”
Mr. Kramer received a $1.2 million cash bonus in 2020, the records show, and also sold about $10 million worth of stock this year, in trades that he said were scheduled in advance and approved by the company. Three of the company’s executive vice presidents received bonuses ranging from $445,000 to $462,000 each.
Sean Kirk, the executive responsible for overseeing development and manufacturing operations at all of Emergent’s manufacturing sites, received a special bonus of $100,000 last year, in addition to his regular bonus of $320,611, in part for expanding the company’s contract manufacturing capability to address Covid-19, the documents show. Mr. Kirk is now on personal leave.
Emergent officials “appear to have wasted taxpayer dollars while lining their own pockets,” Ms. Maloney charged.
Mr. Krishnamoorthi asked Mr. Kramer if he would consider turning over his bonus to the American taxpayers.
“I will not make that commitment,” Mr. Kramer replied.
“I didn’t think so,” Mr. Krishnamoorthi shot back.
Rebecca R. Ruiz contributed reporting.
He clearly regards Mr. Xi as a worthy competitor who will force America to up its game — thus the focus in his speech on education, speedier, universal internet access, and on partnerships with industry in new technologies. Mr. Biden has made clear to his aides, in lengthy Situation Room sessions on China strategy, that his administration must finally focus the country on the existential threat of a world in which China dominates in trade and technology, and controls the flow of electrons — and the ideas they carry.
In contrast, he regards Mr. Putin’s Russia as a declining power whose only real capability is to act as a disrupter — one that seeks to split NATO, undermine democracy and poke holes in the computer and communications networks that the United States, and the rest of the world, depend upon. That came through in the speech. While he did not repeat his reference to Mr. Putin as a “killer,” he focused on the recent sanctions. “He understands we will respond,” he said, while opening the door to new agreements on arms control and climate.
But making this twin strategy of competition and containment work, Mr. Biden acknowledged at one point, depended on persuading Americans to make the necessary investments, and convincing allies that the United States would have their backs.
The pandemic response, he suggested, paved the way. One hundred days ago it would have been hard to imagine any country turning to the United States for coronavirus aid; now India has, and the pressure on Mr. Biden is how fast he can deploy vaccines to the rest of the world, at a moment that domestic politics suggests he needs to vaccinate all willing Americans first.
But when the pandemic abates, the divisions in the United States will remain. And those divisions, he knows, will be exploited by Mr. Xi and Mr. Putin to further their argument that America is in terminal decline.
It is still a powerful argument, one that Mr. Biden acknowledged when he described his conversations with nearly 40 world leaders.
“I’ve made it known that America is back,” he said. “And you know what they say? The comment that I hear most of all from them is they say, ‘We see America is back but for how long? But for how long?’”
WASHINGTON — Four months after Congress approved tens of billions of dollars in emergency rental aid, only a small portion has reached landlords and tenants, and in many places it is impossible even to file an application.
The program requires hundreds of state and local governments to devise and carry out their own plans, and some have been slow to begin. But the pace is hindered mostly by the sheer complexity of the task: starting a huge pop-up program that reaches millions of tenants, verifies their debts and wins over landlords whose interests are not always the same as their renters’.
The money at stake is vast. Congress approved $25 billion in December and added more than $20 billion in March. The sum the federal government now has for emergency rental aid, $46.5 billion, rivals the annual budget of the Department of Housing and Urban Development.
Experts say careful preparation may improve results; it takes time to find the neediest tenants and ensure payment accuracy. But with 1 in 7 renters reporting that they are behind on payments, the longer it takes to distribute the money, the more landlords suffer destabilizing losses, and tenants risk eviction.
scheduled to expire in June.
“I’m impressed with the amount of work that unsung public servants are doing to set up these programs, but it is problematic that more money isn’t getting out the door,” said Ingrid Gould Ellen, a professor at New York University who is studying the effort. “There are downstream effects if small landlords can’t keep up their buildings, and you want to reach families when they first hit a crisis so their problems don’t compound.”
Estimates of unpaid rents vary greatly, from $8 billion to $53 billion, with the sums that Congress has approved at the high end of the range.
The situation illustrates the patchwork nature of the American safety net. Food, cash, health care and other types of aid flow through separate programs. Each has its own mix of federal, state and local control, leading to great geographic variation.
programs with discretionary money from the CARES Act, passed in March 2020. These efforts disbursed $4.5 billion in what amounted to a practice run for the effort now underway with 10 times the money.
Lessons cited include the need to reach out to the poorest tenants to let them know aid is available. Technology often posed barriers: Renters had to apply online, and many lacked computers or internet access.
nearly 1 renter household in 5 reported being behind on payments.
The national effort, the Emergency Rental Assistance Program, is run by the Treasury Department. It allocates money to states and also to cities and counties with populations of at least 200,000 that want to run their own programs. About 110 cities and 227 counties have chosen to do so.
The program offers up to 12 months of rent and utilities to low-income tenants economically harmed by the pandemic, with priority on households with less than half the area’s median income — typically about $34,000 a year. Federal law does not deny the aid to undocumented immigrants, though a few states and counties do.
Modern assistance seems to demand a mix of Jacob Riis and Bill Gates — outreach to the marginalized and help with software. Progress slowed for a month when the Biden administration canceled guidance issued under President Donald J. Trump and developed rules that require less documentation.
Other reasons for slow starts vary. Progressive state legislators in New York spent months debating the best way to protect the neediest tenants. Conservatives legislators in South Carolina were less focused on the issue. But the result was largely the same: Neither legislature passed its program until April, and neither state is yet accepting applications.
“I just don’t know why there hasn’t been more of a sense of urgency,” said Sue Berkowitz, the director of the South Carolina Appleseed Legal Justice Center. “We’ve been hearing nonstop from people worried about eviction.”
committee in the state House of Representatives found that after 45 days, the program had paid just 250 households.
By contrast, a program jointly run by the city of Houston and Harris County had spent about a quarter of its money and assisted nearly 10,000 households.
Not everyone is troubled by the pace. “Getting the money out fast isn’t necessarily the goal here, especially when we focus on making sure the money reaches the most vulnerable people,” said Diane Yentel, the director of the National Low Income Housing Coalition.
2018 study found the area had the country’s highest eviction rate. Charleston County ran three rounds of rental relief with CARES Act money, and the state ran two.
The second state program, started with $25 million in February, drew so many applications that it closed in six days. But South Carolina is still processing those requests as it decides how to distribute the new federal funds.
Antonette Worke is among the applicants awaiting an answer. She moved to Charleston from Denver last year, drawn by cheaper rents, warmer weather and a job offer. But the job fell through, and her landlord filed for eviction.
Ms. Worke, who has kidney and liver disease, is temporarily protected by the federal eviction moratorium. But it does not cover tenants whose leases expire, as hers will at the end of next month. Her landlord said he would force her to move, even if the state paid the $5,000 in overdue rent.
Still, she said the help was important: A clean slate would make it easier to rent a new apartment and relieve her of an impossible debt. “I’m stressing over it to the point where I’ve made myself sicker,” she said.
Moving faster than the state, Charleston County started its $12 million program two weeks ago, and workers have taken computers to farmers’ markets, community centers and a mall parking lot. Christine DuRant, a deputy county administrator, said the aid was needed to prevent foreclosures that could reduce the housing stock. But critics would pounce if the program sent payments to people who do not qualify, she said: “We will be audited,” possibly three times.
Latoya Green is caught where the desire for speed and accounting collide. A clerk who lost hours in the pandemic, she owes $3,700 in rent and utilities and is protected by the eviction moratorium only until her lease expires next month.
She applied for help on the day the county program started but has not completed the application. She said she is unsettled by the emails requesting her lease, which she lacks, and proof of lost income.
Still, Ms. Green does not criticize Charleston County officials. “I think they’re trying their best,” she said. “A lot of people run scams.”
With time running short, she added: “I just hope and pray to God they’ll be able to assist me.”