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Loan Program Marred by Glitches; Boris Johnson Remains in ICU; More Sailors Positive for COVID-19. Aired 9:30-10a ET
Aired April 8, 2020 - 09:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
POPPY HARLOW, CNN ANCHOR: Next.
JIM SCIUTTO, CNN ANCHOR: More help, more stimulus could be on the way as early as tomorrow. Senate Majority Leader Mitch McConnell says that Congress could secure another $250 billion, this in aid for small businesses.
HARLOW: It follows a rocky rollout of the initial Paycheck Protection Program meant to keep banks lending the companies to keep their workers on the payroll and not let them go. Also the president yesterday ousted the inspector general, the person in charge of overseeing how the trillions of dollars in stimulus money is being spent.
Our Phil Mattingly has more on all of this.
STEVE MNUCHIN, TREASURY SECRETARY: We need to get money to small businesses and American workers and that's what we're doing.
PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT (voice over): It's the backbone program of the largest economic rescue package in U.S. history.
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: My administration will continue to take the boldest action in history to bring immediate relief to the small businesses.
MATTINGLY: $350 billion for small businesses to save their employees amid the avalanche of layoffs nationwide. But despite the need and the president's effusive praise --
TRUMP: Great loans for the banks and they're great loans for small business. People are loving it. They're really loving it.
MATTINGLY: It's rollout has been plagued by glitches, technical failures and confusion. LARRY KUDLOW, WHITE HOUSE ECONOMIC ADVISER: We got off to a bad start
MATTINGLY: Accelerating the anxiety for millions of small businesses on the precipice of collapse. Administration officials and lawmakers say the issues are to be expected.
SEN. MARCO RUBIO (R-FL): Any time you design a program that applies to 90 percent of the companies in America and spend $345 billion and you have six days to do it, you're going to have glitches.
MATTINGLY: The scale of the program is more than ten times what the Small Business Administration guaranteed just one year ago. And government officials had just seven days to turn legislation --
UNIDENTIFIED MALE: The bill is passed.
MATTINGLY: Into an economy-saving program.
MNUCHIN: The whole point of this program is to keep 50 percent of America back at work so that small businesses can reopen quickly.
MATTINGLY: One that would provide loans of up to $10 million to businesses with under 500 employees. But more than that, those loans would be forgiven, essentially turned into grants if that money was used to pay salaries, payroll expenses or business costs, like mortgages and rent. But the exceedingly tight timeline left many of the details too open ended for some lenders to even get online in its initial days multiple bank executives told CNN.
The largest community bank trade group firing off a Saturday night letter, noting, quote, community bankers remain frustrated with a myriad of unanswered questions and lack of clear instruction on how to complete loans through the SBA. And when guidance was provided, it came just hours before the program was set to launch.
The largest banks initially put limits on which customers they would serve, infuriating some business owners. While others repeatedly ran into notices like this, websites going down or under maintenance due to the sheer volume of applications, all as lenders face the government's own technological issues as the SBA's system for processing loans was down for hours at a time, several sources told CNN. The rocky start, something Trump himself tried to look past.
TRUMP: I mean it's only been going for a couple of days. It's really been performing well. Couple of little glitches, minor glitches, that have already been taken care of.
MATTINGLY: Yet there has been some progress in the days since the initial launch.
TRUMP: As of today, SBA has processed over $70 billion in guaranteed loans.
MATTINGLY: And each day, administration officials, lenders and small businesses say the process is starting to smooth out and lawmakers already considering adding another $250 billion to the program, underscoring both the urgency and volume the crisis for small businesses, but also their faith that the problems will be worked out, even if participants say some of the current optimism --
TRUMP: It has become so popular.
And it's really a tribute to government, really well-run government.
MATTINGLY: Isn't merited --
TRUMP: Congratulations on this success.
MATTINGLY: Just yet.
MATTINGLY: Now, guys, obviously we were talking about the Republicans, the White House want to move quickly on that $250 billion in additional funding, but there are some roadblocks. Democrats, this morning, Speaker Nancy Pelosi, Democratic Leader Chuck Schumer, releasing their demands for that extra cash, that extra infusion of cash, including $100 billion in additional funding for hospitals, $150 billion for state and local governments, increases to the SNAP, the food stamps program as well. So there's going to be a negotiation here to some degree. And whether or not it actually ends with that money coming into place, still an open question right now. So keep an eye on that.
But one thing is clear, both Republicans and Democrats want this program to work. They need this program to work.
MATTINGLY: They expect this program to work at some point. It's just not quite there yet, guys.
HARLOW: Let's hope it is very soon. Phil, thank you. Great reporting.
Christine Romans, our chief business correspondent, is with us.
And let's all just take a look at this video for a moment, guys, because this is so startling and it shows the need, the urgent need. If we can pull it up. This is out of Florida. And these are people lined up for blocks and blocks and blocks, waiting for unemployment filings because they can't get through over the phone.
CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Yes.
HARLOW: This is yesterday in Hialeah, Florida. By the way, that's not six feet apart.
HARLOW: But they're desperate, Christine. That -- I think that shows the magnitude of the problem. And another concern I've been hearing a lot about is that these banks,
the big banks, seem to be prioritizing requests for loans from people that already have existing relationships at the banks, that already bank through them, which would ultimately mean that those less well- off are basically at the end of the line again.
ROMANS: Yes, it's a little bit like "Hunger Games" in effect because you've got -- you've got the banks who already have existing client relationships, everything set up, everything approved. It's not -- the fastest way to get the money out is to just prioritize those people who already have existing lending agreements with the bank and they're trying to get this money out, right?
They want to get it in the economy as quickly as possible. And so that leaves some small businesses who have never borrowed money before, right, who are now, for the first time, going out there trying to get, you know, get this relationship started. They feel like they're at the back of the line. That's one of the reason I think why you're going to see the White House and Congress pretty quickly come together with even more money because this small business rescue is a first come, first serve thing and with it -- between the technical glitches and sort of like trying to get new relationships with the lenders, and the SBA, you know, there needs to be more money and it sounds like everybody wants to make sure it gets there.
SCIUTTO: But, Christine, is money really the problem here? I mean $2 trillion. Now you're talking about $250 billion.
ROMANS: I know.
SCIUTTO: But you look -- and, granted, that was unemployment as opposed to small business aid there --
SCIUTTO: There's no process for getting the aid to the people who need it, at least -- at least in Florida, as we were watching -- I mean, in fact, I know allowance for the health risks of people coming in.
SCIUTTO: Money is one thing. Who's fixing the infrastructure of getting this aid to small businesses who -- they need it today. They don't need it in a month.
ROMANS: I know. So these -- so -- right. Well, when you're talking about the jobless claims checks there that are going out, people are having trouble getting their job -- I mean a third of people didn't pay their rent in April, right?
ROMANS: A third didn't pay their rent because they don't have the jobless check yet or they're worried that they're going to lose their small business or medium business job. I mean that's pretty, pretty stunning.
Now, the states are spending big on new infrastructure, hiring people for the jobless claims offices. I mean states are bringing back retirees. I mean, ironically, it's the unemployment office that's hiring in America right now because they're trying to get that money out.
And it should be today that $260 billion from the federal government from that bailout is going to go to the states so they can enhance those unemployment checks so people get an extra $600 in their on top of their state -- their state jobless claims benefit for the next four months.
HARLOW: OH, OK. Christine, thank you for being on top of this. It's such a struggle.
ROMANS: It's so frustrating. It's so frustrating. I know it's just like -- it's just not easy.
HARLOW: I know. And everyone wants it to work. Everyone wants it to work.
OK, thank you very much.
SCIUTTO: Yes, we're -- and with very real consequences for the people involved who need that aid.
Overseas now. Officials in the U.K. say that Prime Minister Boris Johnson is breathing on his own without a ventilator, though he needs oxygen. We're going to have the latest, next.
SCIUTTO: We've said throughout this, that really anyone can be at risk for infection. Proof, of course, in the U.K. This morning, U.K. Prime Minister Boris Johnson, he remains in intensive care. However, we're told he is in stable condition and responding to treatment according to a spokesperson.
HARLOW: Our Clarissa Ward joins us again outside the hospital where he is being taken care of.
What do we know this morning about his condition?
CLARISSA WARD, CNN CHIEF INTERNATIONAL CORRESPONDENT: Yes, Poppy, it's hard to believe it's been three nights now that British Prime Minister Boris Johnson has spent in this hospital behind me, two of them in the intensive care unit.
From what we know, his condition continues to be stable, which is good in the sense that it's not deteriorating. But also a little concerning in the sense that it's not actively improving either.
We know that he is not ventilated, intubated, he's not breathing on a ventilator, he is breathing on his own. He is conscious. He is continuing to get oxygen treatment.
But, really, no one has been given a sense of when we might expect to hear more on his condition, when we -- doctors might expect his condition to kind of move in one direction or another.
And, meanwhile, there's certainly growing anxiety in the country about all the things that this country is dealing with, of course, in the midst of this coronavirus crisis. Monday is a big deal because it will have been three weeks since the sort of quasi lockdown was instigated and it's supposed to be reviewed on Monday and the government will be taking a decision as to whether to continue it or to potentially lift it. So far no one is being drawn on whether or not -- or which direction they'll go in. There's certainly no indication yet that the lockdown will be lifted. Although yesterday we did hear from the government that they do believe possibly there is a plateauing in the number of hospital admissions. Not in deaths, the deaths continue to spike, but at least potentially in hospital admissions.
SCIUTTO: Yes, more evidence perhaps that social distancing makes a difference here, flattens that curve. It's on all of us.
Clarissa Ward in the U.K., thanks very much.
Just in to CNN, a jump in coronavirus cases on board the USS Theodore Roosevelt carrier. We're going to have the latest just ahead.
HARLOW: This just in. Nearly 300 crew members on the USS Theodore Roosevelt now have tested positive for Covid-19. This comes as acting Navy Secretary Thomas Modly resigned after a leaked audio exposed him railing against the ousted commander of the ship and saying pretty unbelievable things about him.
SCIUTTO: Yes. Naive and stupid were the exact words.
HARLOW: Yes. Yes.
SCIUTTO: Modly had fired Captain Brett Crozier of the Roosevelt after Crozier raised issues about the safety of his crew, expanding infections, by sending a memo warning how quickly Covid-19 could spread among the sailors.
CNN Pentagon correspondent Barbara Starr joins us now. First let's talk about that ship there. I mean this is a key -- a key,
you know, a key asset in the U.S. military around the world, 300 of the crew now facing this. What does this mean for its operations?
BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, the Navy insists that the -- insists that the ship is still operational, that if there became a combat emergency, that they could get everybody back out to sea that they could and that this ship could still operate.
But more than -- nearly 300 now positive with the virus. It may be close to the final number because more than 90 percent of the more than 4,000 onboard the ship have now been tested. But, look, the ramifications really are much deeper than that.
Now, the acting Navy secretary, after he railed, as you said, the captain of the ship, went out to the ship, he railed at the crew. He had to resign. You had an untenable situation. He goes out there, out to Guam, you know, kind of lectures the crew, and they yell back at him. We heard that all on tape. Unprecedented.
And the backdrop for the Pentagon is it very quickly began to realize, many, many people, regardless of military protocol, were really worried about the crew, really worried about how the captain was treated, and they had a lot of questions about whether the military was taking this all seriously enough when it came to the health of the crew. So nobody at the Pentagon really wanted to continue to deal with that backdrop. They had Modly resign essentially. He knew he had to. They've brought in a new acting secretary. He's actually a senior Army official right now but has a long previous career inside the Navy.
HARLOW: It is all just so unprecedented, as you said, Barbara, as this keeps developing.
HARLOW: Obviously wishing all those 300 service members the best now.
Thank you, Barbara.
We're getting a major update on coronavirus. There's new modeling and it suggests perhaps we're going to see less, fewer deaths in the United States.
HARLOW: The peak, though, still here in just a few days.
Stay right there.