LONG READ

The Great Lakes depend on ice. This winter, they barely froze

Alejandra Borunda 3/235/2020

In December, Michigan-based photographer Amy Sacka set off on an epic road trip. Her goal: to travel around each of the Great Lakes, documenting the fullness of the winter-centered culture. But the winter was warm. In many places, like Lake Erie’s Presque Isle State Park, above, the snow, ice, and bitter cold that usually grip the region never appeared. In these photos, we follow her journey around the five Great Lakes over the course of winter 2020, from December through March. SLIDES © Photograph by Amy Sacka

It’s still dark, and well below freezing, when Kristie Leavitt pulls to a stop and turns off the 4x4’s rumbling motor. For a moment, there’s no sound in the world but the faint whisper of wind sweeping over the ice. The navy blue sky begins to lighten. The cold air burns in her lungs.

Bundled in a hot-pink coat that matches her fishing hut and gear, Leavitt hops down from the driver’s seat onto the 18-inch-thick ice that covers this corner of Munuscong Bay, in Michigan’s Upper Peninsula. Her boots crunch into a thin layer of snow as she begins the ritual of preparing for her favorite activity: ice fishing.

Leavitt is among the two million ice anglers in the United States who look forward all year to the chill of winter. Like many others in the region, she also relies on the cold for a living. She manages her family’s tourist cabins and bait shop on the edge of the bay, and the businesses make most of their money during the ice fishing and snowmobiling season.

But what Leavitt is doing today is a rare occurrence this year in the Great Lakes region. The long-term average for ice coverage on all five Great Lakes is 55 percent. This winter, ice covered only about 22 percent of the lakes’ surfaces—a near record low.

Some lakes didn’t freeze at all. Others saw only faint traces of ice around their edges, or froze for only a short time before the ice melted away. The weekend before Leavitt’s outing, temperatures in the region shot up to 40 degrees Fahrenheit, and ice anglers slogged through slush in T-shirts.

One over-warm season isn’t necessarily a harbinger of inevitable change. But increasingly, scientists can pick out patterns in the scattershot records of change from across the Great Lakes, and those patterns are pointing toward a sobering conclusion: This winter, with its faint traces of ice, is likely just a taste of the future to come.

(Read about how the changing climate is unravleing other ecosystems, too).

© None

DECEMBER 31, 2019 – A surfer catches a wave on an ice-free Lake Superior outside of Duluth, Minnesota on the last day of 2019. Lake Superior had one of its least ice-covered years ever, with just about 20 percent cover by the end of February. Lake Superior is the second-fastest warming lake in the world; its water is warming up more quickly than the air around it.

The long history of the lakes, shaped by climate

© Photograph by Amy Sacka

DECEMBER 31, 2019. Surfer Andrew Peterson stands near a surfing spot outside of Duluth, Minnesota. Nearly a half dozen surfers ride the ice-free waves of Lake Superior behind him. Andrew knows that there are complicated factors at play controlling the ice on the lake. Sometimes ice will form, but doesn’t stick around. That’s what happened this year.

“There was ice here in Duluth, and then it blew out,” he says. “We didn’t think we were going to be able to get out on the water for another day of surfing, but we did.”

In the earliest days of December, the ice looked like it was on track for a “normal” year. But conditions changed—and never recovered.

The five Great Lakes—Superior, Michigan, Erie, Huron, and Ontario—collectively account for about 20 percent of the fresh water on Earth’s surface. For perspective: That’s an amount so vast that it could cover the entire United States in nearly 10 feet of water.

The lakes’ geographical footprint is also hard to fathom. Their combined surfaces span more than 94,000 square miles, about the size of the United Kingdom. The combined measurement of the coasts of all five lakes is thousands of miles longer than either the Pacific or Atlantic coastlines.

The presence of all that water was shaped by natural changes in Earth’s climate through deep time.

But the lakes are now facing a new, unprecedented future, and this time, humans are behind it.

All in all, the planet has warmed by an average of 1.8 degrees Fahrenheit (1 degree Celsius) since 1900. The Great Lakes region is right on track with this global trend: Within the basin, air temperatures have risen by an average of 1.6 degrees Fahrenheit compared to the first 60 years of the 1900s. And much of that warming has been concentrated in the winter months, nudging the ice ever closer to its tipping point.

“Lake ice is an amazing indicator of climate,” says Sapna Sharma, an environmental scientist at York University in Toronto. “Ice freezes when temperatures are below zero. It’s such a clear indication of climate change—and people have recorded it, in some cases, for centuries.”

In Japan, priests at a Shinto temple have kept an almost 700-year-long record of when their lake freezes solid. Natural climate cycles emerge from that record—dwarfed in recent decades by the human-caused warming that has gripped the planet. Merchants who used Finland’s Torne River for trade kept track of the date the ice broke up each year from 1693 onward.

In Lake Superior, shipping companies whose boats need open water also have kept records of ice formation and breakup since 1857. In all these records, there’s a lot of bouncing around—cold years with long stretches of early ice, warm years with less. But the short-term bounces build up into a distinctive signal of human-caused warming starting after the Industrial Revolution.

“What’s happening in the Great Lakes region is a small part of a bigger story,” says Lesley Knoll, a lake expert at the University of Minnesota’s Itasca Biological Station who spends part of her time studying the cultural relationships people have with frozen lakes.

Kristie and the lake

JANUARY 26, 2020. Lightly dressed locals gather at the 

Lake Ontario waterfront.4 SLIDES © None

JANUARY 26, 2020. Lightly dressed locals gather at the Lake Ontario waterfront.

For Leavitt, 32, the ice has always been a place to bring her life into focus.

When her family would drive up from downstate to visit her grandparents, who owned the lakeside camp at the time, she would layer on warm clothes, collect a small cooler of minnows from the bait shop, and walk out onto the ice as far as she could get. She’d crank her hand-powered auger, cut a channel through the thick ice, and open up a portal to the quiet underwater world.

The old-timer at the bait shop had handed her a rod off the wall the first time she’d gone in there. He showed her how to tie a lure, and how to tip the rod up and down to make the lure and minnow glitter in the water’s depths. That first rod, a scant three feet long, hangs on the wall of her shanty to this day.

Back then, it was a simple affair. She’d bring what little equipment she had out to the ice, perch on an overturned five-gallon bucket, and sit there for hours, tipping the nose of the rod up and down like a conductor’s baton, calling to the symphony of fish below. She didn’t catch much. But the feel of it—the clouds skidding overhead, the water changing colors below her feet, the wind swishing past—got locked into her brain as the platonic ideal of winter.

Leavitt is far from alone. The ice provides crucial things for everyone who goes out on it. Respite for some, a dearly held recreation opportunity for others, food, and much more. Around the Great Lakes, ice is also a critical component of the local economies; a recent estimate says winter tourism accounts for some $3.5 billion across the region. A single ice fishing tournament can bring in hundreds of thousands of dollars to the local communities.

But in parts of Lake Superior, the ice season has been shrinking by an average of almost a day each year for the last few decades. That means the year Leavitt was born, a winter on Superior would have included nearly a month more ice cover than it does today. Superior is also warming faster than just about every other large lake on the planet, second only to Lake Fracksjon in Sweden.

© None

FEBRUARY 15, 2020. In Caseville, Michigan, a participant in the polar bear plunge braves the icy cold Lake Huron waters during the town’s 28th annual “Shanty Days” festival. In the event’s early days, the festival took place on the ice. Now, most activities are held on the shoreline because the ice is not reliably thick enough to safely support the crowds.

(See photos of the vibrant surf scene on the Great Lakes)

The other Great Lakes’ ice seasons are also shrinking: All are shortening by an average of about half a day per year. The waters are warming as fast as or faster than the air around them, which has risen about 1.6 degrees since the beginning of the last century. That number may sound small and benign, but it masks much more critical changes in a place where the line between ice and no ice, snow and rain, can be razor-thin.

It’s difficult to see the change clearly, in some cases, because there’s huge year-to-year variation, says Jia Wang, an atmospheric scientist at NOAA who focuses on ice cover in the Great Lakes region. Though they’re thousands of miles from the oceans, the Great Lakes feel weather influences from both the Pacific and the Atlantic and incorporate these weather patterns into their own tangled mishmash.

So, though one year may be warmer than the one before, some winters in recent history were icy cold. In 2013-14, the polar vortex carried frigid air from the Arctic down into the continental U.S., and the cold stretched well south of the Great Lakes. The ice grew feet thick in parts of the lakes, and total ice cover spanned more than 90 percent.

The extra tricky part is that the presence and growth of winter lake ice each year is a complicated sequence of events. Maybe it gets cold enough for ice to form early in the winter—but if a stretch of bitter wind keeps the water’s surface churning, the ice will form later. Maybe the summer before was extra warm, zapping enough extra heat into the water that it takes it extra-long to cool off and get to the point when it can start to freeze. Maybe a bunch of snow falls early in the season, insulating the ice from the top and, counterintuitively, keeping it from growing quickly through the cold temperatures.
© None

FEBRUARY 24, 2020. Kristie Leavitt catches a pike in her homemade pink shanty in Munuscong, Michigan. Leavitt runs Dan’s Resort, a spot with some cabins and a bait shop that caters to ice anglers in the area. Leavitt lives for the winter months and ice fishing. Unlike most spots on the Great Lakes, Munuscong has thick ice this winter—a rarity in this warm winter. The previous weekend, Leavitt hosted a three-day fishing tournament that drew nearly 700 anglers from all over the state and beyond.

But there are some factors that aren’t so complicated. The air is getting warmer. So is the water, in many places faster than the air. Across the Northern Hemisphere, nearly 15,000 lakes that used to freeze solid each winter have begun to freeze intermittently, if at all.

A future less frozen

The real question is, of course, the future. Winter is embedded in this place. It’s integral, non-negotiable, definitional.

The warm days in mid-February draw Michiganders outside, but there’s an uneasy undercurrent to their enjoyment. “We like it when it’s nice like this, but it’s not real winter unless it’s like, minus 40,” says Kasey Spencer, a lifelong Upper Peninsula resident. “When it’s cold, we’re miserable—but we’re also really happy, you know? If we have a really warm winter, it feels like something’s wrong.”

MARCH 1, 2020. A woman and her dog walk 

the shoreline of Lake Michigan. © None

 JANUARY 29, 2020. “What we have in Orleans County is the fishing industry,” says Sharon Narburgh, the owner of Narby’s Suprette & Tackle on Lake Ontario. In many parts of the Great Lakes this year, the lack of ice cover has made fishing impossible or unsafe. Some anglers have still stopped by to use the unique vending machine outside the shop, which sells live bait and tackle instead of cookies and sodas. © None

JANUARY 29, 2020. “WHAT WE HAVE IN ORLEANS COUNTY IS THE FISHING INDUSTRY,” SAYS SHARON NARBURGH, THE OWNER OF NARBY’S SUPRETTE & TACKLE ON LAKE ONTARIO. IN MANY PARTS OF THE GREAT LAKES THIS YEAR, THE LACK OF ICE COVER HAS MADE FISHING IMPOSSIBLE OR UNSAFE. SOME ANGLERS HAVE STILL STOPPED BY TO USE THE UNIQUE VENDING MACHINE OUTSIDE THE SHOP, WHICH SELLS LIVE BAIT AND TACKLE INSTEAD OF COOKIES AND SODAS.

What the future holds is both more and less. There’s more heat in the air, trapped by the greenhouse gases humans continue to pump into the atmosphere. Predictions for the region forecast air temperatures to rise by another 1.5 degrees or more by 2045, and somewhere between roughly six to 10 degrees by the end of the century. There’s also more heat in the water, forced in during hot summers and longer stretches of warmth.

However, by the end of the 2030s, some scientists predict that there will be 15 to 16 fewer days with the maximum temperature below freezing in the Great Lakes region. By the 2050s, we’ll add another few days to that total. By the end of the century, depending on the strength and aggressiveness of climate actions taken, the number of days below freezing each year is likely to drop by somewhere between 21 to 33.

In the 2015 Paris Climate Agreements, countries agreed to try to limit planetary warming from surpassing 3.7 degrees Fahrenheit (2 degrees Celsius) beyond pre-Industrial levels. Even if those goals are met, Sharma estimates that more than 35,000 Northern Hemisphere lakes could lose their consistent winter ice. If warming shoots past that target, the number balloons. Under the most dire scenarios, more than 200,000 lakes could lose their ice.

“Things like ice and water have a long memory,” says Richard Rood of the University of Michigan, who focuses on the complicated ways climate change is playing out across the Great Lakes region.

“What we’re seeing is some systematic increases in temperature over the long run, putting you closer to freeze-thaw cycle of water. And you’re seeing winters getting warmer, shorter—so you just don’t have the amount of time you used to for thermodynamics to do their thing.”

If the water doesn’t cool down enough during the winter, it gets warmer, faster, in the spring and summer. Over time, and especially as the climate keeps up its inexorable warming, the system could wind itself up more and more—a self-reinforcing loop.

“At some point these areas that maybe sometimes get ice and sometimes don’t, they’re going to transition to never getting ice,” Knoll says. “How are people going to interact with those water bodies when they never get ice at all? How are they going to adjust? How are their lives going to change?”

Leavitt, like many others up here, hesitates when she starts to talk about the future. The world as she sees it is still ice-covered; each year is another open-ended opportunity for cold. But sometimes, the concerns bubble up, at least quietly.

“Sometimes I just don’t know,” she says slowly, leaning forward over the tip-up she’s setting on an open hole, strands of hair wisping around her intent face. “Will all this still be around when I’m 70?”

Amy Sacka is a documentary photographer based in Detroit whose work focuses on the people, culture and environments of the Great Lakes. Follow her on Instagram @amysacka.

https://www.msn.com/en-us/weather/topstories/the-great-lakes-depend-on-ice-this-winter-they-barely-froze/ar-BB11E1CR

UPDATED
Tsunami threat remains for Russia after quake off Kuril Islands
3/25/2020
(Reuters) - Residents in the northern part of Russia's Kuril Islands remain under threat from tsunami after a 7.5 magnitude earthquake struck off the coast, but emergency services reported small waves and no casualties or damage.

Meteorological authorities in Japan issued no tsunami alerts while U.S. authorities canceled a warning for Hawaii after the earthquake hit near the Kurils, situated between the Pacific Ocean and the Sea of Okhotsk.

"A tsunami wave arrived in Severo-Kurilsk at 1515 Sakhalin [region] time (0415 GMT)," Russia's emergency services said. "The wave height was about 50 cm (20 inches)."

Residents will remain in a safe zone on higher ground, the emergency services said, while the tsunami threat remains, adding a decision to cancel the alarm will be made by specialists after the low tide starts.

The U.S Pacific Tsunami Warning Center said the country's West Coast, Alaska and Canada's British Columbia didn't face any tsunami danger from the quake.

Some of the U.S. coastal areas may experience non-damaging sea level changes, the agency added.

The Japan Meteorological Association also said there might be slight tidal changes but said no warnings or even watch advisories had been issued.

The earthquake, 218 km (135 miles) south-southeast of the town of Severo-Kurilsk, struck at a depth of 56.7 km (35 miles), the U.S. Geological Survey (USGS) said.

The USGS had initially said the quake measured 7.8, but revised that figure down to 7.5.

There were no immediate reports of damage or casualties.

(Reporting by Shubham Kalia in Bengaluru and Alexander Marrow in Moscow; Editing by Clarence Fernandez and Gerry Doyle)

Earthquake off Russia's Kuril Islands prompts tsunami warning
dw.com
3/25/2020 
A magnitude 7.5 earthquake has hit off the coast of the Kuril Islands, in eastern Russia. The US Geological Survey has warned the event could "generate a destructive tsunami" in the North Pacific.  

© Getty Images/AFP/K. Nogi Provided by Deutsche Welle

An earthquake measuring 7.5 on the Richter scale struck off the coast of Kuril Islands in the far east of Russia on Wednesday, triggering a tsunami warning for the nearby shores. There is an ongoing investigation to determine the threat.

Tsunami Watch issued for Hawaii after a 7.8M earthquake near the Kuril Islands, east of Russia. pic.twitter.com/9MHC010Qng— Ricky Matthews (@wxrjm) March 25, 2020

According to the United States Geological Survey the earthquake hit a depth of 59 kilometres (37 miles), around 1,400 kilometres (around 850 miles) northeast of the Japanese city of Sapporo.

"This earthquake has the potential to generate a destructive tsunami in the source region," the US Tsunami Warning Center said, adding that it was "analyzing the event to determine the level of danger".

A tsunami watch alert was also issued for Hawaii, but was canceled shortly afterward.

Auto suppliers fear financial ruin as GM, Ford and FCA grind to a halt

THAT WILL INCLUDE CANADIAN SUPPLIERS LIKE MAGNA INTERNATIONAL

Jamie L. LaReau, Detroit Free Press 3/25/2020



Detroit streets empty after Whitmer's stay at home order

About 4:30 p.m. last Wednesday the employees at auto supplier Dana Inc. in Warren received an unsettling text message from management.

The text, obtained by the Free Press read, "We are well aware of the Ford, FCA and General Motors announcement," referring to the Detroit Three's decision earlier that day to temporary shutdown all North American assembly plants because of the coronavirus pandemic.

"Dana is reacting to our customers. Dana is currently evaluating the situation and will make a final determination as quickly as we can," the text read.

At noon the next day, dozens of day-shift workers stared at a newly posted schedule that was nearly blank.

"It showed we’d have the whole week off starting Friday until the 30th. There was nothing on it, but a few spots on day shift...and it's voluntary," said Arron Drescher, who's worked at Dana Warren for five years.

A spokesman for Dana confirmed it is adjusting production schedules, idling some factories, and managing controllable costs, while working to keep employees safe. He would not comment on the plant in Warren.

Many suppliers have made the difficult decision to send workers home and run on partial shifts or not at all. In part, it's to protect their employees' health. But it's also because their biggest customers — the car companies — idled production after the UAW pushed to protect workers.

No one knows when that new-car production will resume, especially in light of Gov. Gretchen Whitmer's order Monday mandating most people stay at home through April 13. A UAW memo to workers at General Motors' Bowling Green plant in Kentucky Tuesday said the restart date was pushed back to April 14 from April 6.

Another looming question is if consumer demand will be there whenever production does restart considering the widespread economic impacts of the pandemic.

"That will have a significant impact on suppliers," said Jeff Schuster, president of Americas Operations and Global Vehicle Forecasts at LMC Automotive. "On the demand side, our U.S. forecast is sales will be down this year by 3 million units versus last year. A week ago, we were predicting sales would be down 500,000 to 1 million units."

All of this means several suppliers face the daunting task of keeping their businesses in the black while the workforce, though glad to be safe, wonder if they will have jobs when operations return to normal.

No panic, yet

Kirchoff Automotive in Tecumseh filed a Worker Adjustment and Retraining Notification with the state saying that because of the Detroit Three's factory shutdowns, it tentatively laid off 338 employees effective March 20. Kirchoff, which makes metal and hybrid structures in body-in-white, crash management systems, chassis applications and cross car beams, said it is unclear when production will restart.

"I’m not going to panic," Drescher said about Dana's shutdown. "It will probably get scarier if it lasts longer. Which is why I think everyone should just stay home and the faster it’ll blow over. But it might take a few weeks or even a month.”

Drescher is full-time at Dana's plant in Warren. Dana is based in Maumee, Ohio, near Toledo. It makes axles, drivetrains and transmissions, among other parts. It employs 36,000 people globally with sales of $8.6 billion last year, according to Dana's website.

The Detroit Three are customers, with Ford Motor Co. the biggest accounting for 20% of Dana's sales last year. Fiat Chrysler was the second biggest at 11% of sales and GM accounts for 3%, Dana's website said.

In her job, Drescher runs a machine that makes parts and axles. She opted out of volunteering to work because she fears getting coronavirus. In many factory jobs, workers often assemble cars and parts in close confines with their co-workers, making the social-distancing six-foot-rule hard to follow.

Also, Drescher has less seniority than others who already raised their hands.

“Some people have a lot of bills, so I’m not mad at them if they were the ones able to work and signed up for the volunteer," said Drescher, who's single without children.
'One day at a time'

Like Dana, Magna International decided last Thursday to temporarily idle work at "a number" of its 348 locations around the world except China. In a statement, Magna said, "We continue to assess our operations on an individual basis."

One of those plants is in Spring Hill, Tennessee. It makes car seats for GM's Spring Hill Assembly plant where GM builds the GMC Acadia, Cadillac XT5 and XT6 SUVs.

“So if they shut down, we’re affected immediately ... to an hour after they’re shut down," said an employee at the plant who declined to be named for fear of retaliation for talking to the media.

The factory is idled through March 30 "based on customer schedules," said Tracy Fuerst, Magna's vice president of corporate communications.

© General Motors An assembly worker at General Motors Spring Hill, Tenn. assembly plant. GM temporarily idled the plant due to coronavirus. That prompted nearby Magna, which supplies its car seats, to also suspend operations.

The employee said he is relieved to not have to go in and risk getting sick. But the man, in his late 20s, has a wife and family to support . He will miss his $550 to $780 a week paycheck.

"I’m taking it one day at a time," he said. "Yesterday, I made the decision to start cancelling non-essential bills, just making sure I prepare myself for the worst. I canceled Netflix, Hulu, Amazon, cable and even my car insurance. I’m looking at limiting my phone bill. We’re cutting down significantly.”


Cash is king

Employees aren't the only ones concerned. So are the bosses.

"It’s all about liquidity, access to cash and hunkering down and getting through this," said Eric Showalter, CEO of Myotec in Farmington Hills. "Then we’ll worry about the profits-and-loss statement. I can tell you probably everyone right now is looking at liquidity, not earnings.”

Indeed, both Ford and GM have said they will draw down billions on their revolving credit facilities to stockpile cash amid the uncertain market conditions.

More: GM is about to stockpile $16B in cash amid uncertainty, coronavirus outbreak

On Friday, Showalter put three of Myotec's stateside plants on suspension for at least one week and furloughed one in Pennsylvania for a day. The down plants are in Knoxville, Tennessee, Macomb County and Manistee. Myotec has about 300 employees in the United States, 200 of them are in Michigan, Showalter said.

Myotek makes small lamps and fog lamps for many automakers including GM and Fiat Chrysler Automobiles. It also makes magnesium parts for those headlamps, which is what GM was looking for to help in its effort to build ventilators for hospitals. Myotek's annual revenue is about $185 million, Showalter said.  
  
© Robert Miller Eric Showalter, CEO of Myotek North America

"Almost all our customers are down this week so we’re trying to manage this with our people," Showalter said. Employees are using vacation time and paid time off, "so we can keep everyone on board and work through this."

Myotec shut down its two plants in China for four weeks during the coronavirus outbreak there. It had no workers get the illness and has done a slow ramp up. It is now at 90% production at both plants, Showalter said.

Showalter is familiar with working through a crisis, he was CEO of auto supplier Meridian Lightweight Technologies Holdings Inc. in Plymouth in 2008 and 2009 when the Great Recession hit and GM and then-Chrysler Corp., filed for Chapter 11 bankruptcy protection.

"So I’ve been through this," said Showalter. "We’re trying to figure out how to maneuver here so we preserve the health of the company, so employees have a company to come back to. I'd say we're a tad worried now."

His concerns center on when Myotec can get back to work and how will the federal government respond to this crisis.

"How will this effect auto demand and our business activity? Those of us who went through 2009, we’re all talking about the same things we talked about in 2009," said Showalter. "We don’t know if this is another 2009, but that’s our reference point. Mental flexibility is key to this — keep your options as open as you can.”
'We'll get through this'

Meridian employs 2,000 people globally, 400 in Michigan, said Joe Petrillo, director of business development.

The company, a leading global supplier of lightweight cast metal parts mostly for the auto industry, has operations in Eaton Rapids, Canada, Mexico, Europe and two plants in China. As of Sunday, operations continued at many of its facilities.

“We’re keeping our workers employed and we’re waiting to see what happens next, we’re primarily an auto supplier and we really follow the guide of the Detroit Three and others globally," said Petrillo.

© Meridian Meridian manufacturing facility in Eaton Rapids, Michigan.

But Petrillo is nervous about recovery for all auto suppliers.

“Obviously, when this is a sudden stop to the economy it’s gonna hurt," Petrillo said. "From our history in China, it does come back. We know this is temporary and if we follow the right practices, things will get back. There’ll be a short term hit if you think of the financials, but we’ll get through this."

Other big suppliers are going day to day.

A spokeswoman for BorgWarner, which builds powertrain systems, was unclear about the status of its plants, calling it a "dynamic situation that is changing by the hour." She said employees that can work remote are doing so. BorgWarner reported $10.2 billion in sales last year.

The Bosch Group, based in Germany, provides technology to automakers. It has some plants down based on region and a spokesman said it is "continuously fine-tuning our response."

In the United States and Canada, Bosch has a program to pay non-exempt hourly workers who are affected by any shutdowns. Other non-production employees work remotely. Bosch has about 400,000 global employees and its 2019 sales were 77.9 billion euros or $83.7 billion. 

Hoping for no layoffs

For smaller auto suppliers such as Lucerne International in Auburn Hills, CEO Mary Buchzeiger told most of her 20 employees on March 16 to work from home.

She, her CFO and a couple workers were coming in to do light assembly and repackaging, though with shipments several days behind in schedule, the workload is light. That presents her with a heavy burden as to what this pandemic will do to the bottom line.

“If people are saying they haven’t been impacted, they’re crazy," Buchzeiger said. "It has impacted us."

Lucerne sells about $50 million worth of parts each year. It has 16 plants in Asia where it fabricates auto parts using steel and aluminum before shipping them back to the United States for final production for its various automaker customers.

© Andrew Parrish, Lucerne International Inc Mary Buchzeiger, CEO, and Mike Kaminskas, logistics coordinator, both from Lucerne International, on a visit to a partner forging plant in Taizhou, China.

Fortunately, Lucerne trimmed down its costs last year, to be in good financial shape to survive a downturn, Buchzeiger said. But she asks the question many are asking, "How long is too long?”

“I would really like to keep everyone on my payroll and not have to lay anyone off," she said, adding that Lucerne is paying all employees while the company waits to resume business.

"They have small kids at home and I can’t in good conscious just send them to wait in the unemployment line — so we’re taking care of them," Buchzeiger said.

She will take advantage of any government programs and tax credits to offset the cost of employees not working.

'Employee owned'

Twin City Die Casting in Minneapolis has two things going for it during this crisis: diversification and it is an employee-share-ownership company or ESOP. So because the 225 employees have a stake in the revenues they act in their best interest and “they did not it shut down," said Todd Olson, CEO

About 20% of its sales comes from making parts for medical devices, helping offset the loss of auto sales, which comprise 60% of its sales, at the moment. In fact, it's helping GM in its quest to help Ventec build more ventilators faster.

More: GM picks 2 suppliers, considers building ventilators at Indiana plant

© Todd Olson Twin City Die Casting in Minneapolis, Minnesota credits diversification in other industries other than auto for helping it stay afloat during the coronavirus crisis.

Still, the auto industry supports the bottom line, yet production restart dates and consumer demand there remain murky.

“That’s a big concern. The downturn in 2008, 09, 10, it was very tough on the industry," said Olson. "I would expect automotive demand to end up being the same as in that downturn. We’re trying to figure out everything we can do to protect the business."

And even once the automakers get production back online, it will take time for business to resume to a healthy level, analysts said.

“It does take some coordinating to communicate and get the workers back," said Schuster. "This behaves like a wide-spread strike in the sense that it shuts everything down, but the factory is ready to go. You can’t just flip the switch and get everything running because you have tiers that each have to get up and running."

Schuster added, "At this stage, no one escapes this from a financial impact."

More: GM taps big auto suppliers for help in boosting ventilator production

Contact Jamie L. LaReau at 313-222-2149 or jlareau@freepress.com. Follow her on Twitter @jlareauan. Read more on General Motors and sign up for our autos newsletter.

This article originally appeared on Detroit Free Press: Auto suppliers fear financial ruin as GM, Ford and FCA grind to a halt

Fine Print of Stimulus Bill Contains Special Deals for Industries SURPRISE! 

Eric Lipton and Kenneth P. Vogel   3/25/2020




1/4 SLIDES © Alyssa Schukar for The New York Times
The Trump International Hotel in Chicago. At least two 

provisions in the stimulus bill could potentially aid the Trump Organization.

WASHINGTON — Restaurants and retailers will get a tweak to federal tax law they have been seeking for more than a year that could save them $15 billion. Community banks are being granted their long-held wish of being freed to reduce the amount of capital they have to hold in reserve.

And for-profit colleges will be able to keep federal loan money from students who drop out because of the coronavirus.

Tucked into the fine print of the largest bailout in United States history — a $2 trillion federal stimulus package agreed to by congressional leaders and the White House early Wednesday in an effort to reduce the economic devastation of the coronavirus outbreak — are a range of provisions that stand to benefit specific industries and interest groups.

Even the fine print in a near-final version of the 619-page bill has fine print. Democrats proudly announced that they had won agreement on language to block President Trump, other government officials and their families from receiving assistance from a $500 billion fund to be administered by the Treasury Department

But it turns out that Mr. Trump’s companies would not be barred from benefiting from other elements of the bill intended to help broad swaths of American business.

For example, certain hotel owners, even those employing thousands of people, will be eligible for small-business loans, a provision that could potentially benefit Mr. Trump’s company. The Trump Organization could also benefit from the $15 billion change to the tax code won by restaurants and retailers.

The legislation, which could be passed by the Senate and the House and signed into law by Mr. Trump within the next day, is intended primarily to put money in the hands of many households and prop up especially hard-hit industries like airlines. But its sheer size and momentum and the rushed way it was put together made it an irresistible target for lobbyists, who launched a frenzied effort to insert into the must-pass legislation provisions their clients had long sought that in some cases had little to do with the coronavirus crisis.

This lobbying push was unlike any in modern history, as social distancing measures intended to limit the spread of the virus among lawmakers and their staffs left the Capitol eerily quiet. Lobbyists instead pressed their causes to staff members and lawmakers over the phone, or via email. Still, they managed to get through to the key players they wanted to target.

“We went to McConnell’s people, we went to Schumer’s people, and Pelosi’s and McCarthy’s people — we pinged them all,” said Rachelle B. Bernstein, a lobbyist and tax counsel at the National Retail Federation, which pressed successfully for the $15-billion-a-year change in federal tax law.

Referring to her group’s effort to sway the Senate leaders, Mitch McConnell, Republican of Kentucky, and Chuck Schumer, Democrat of New York, and the House leaders, Speaker Nancy Pelosi and Representative Kevin McCarthy, Republican of California, she said, “We just had to do it at a distance.”

The World Health Organization declared a global emergency over the new coronavirus.(Pictured) Dylan Kyriacopoulos, left, and his fiance Mary Williams visit an empty Lincoln Memorial in Washington on March 25. Officials have urged Washington residents to stay home to contain the spread of the coronavirus.Slideshow by photo services

While some industries and companies are benefiting from provisions tailored for them, others appear certain to get a piece of the pie through more general components of the bill, from the $454 billion general purpose fund for businesses and state and local governments to the $50 billion earmarked for airlines and $8 billion for air cargo carriers.

The deal specifically sets aside $17 billion for “businesses critical to maintaining national security” — a category seen as intended at least partly for Boeing, the troubled aircraft manufacturer and Pentagon contractor, whose name appears nowhere in the bill.

“We’ll be helping Boeing,” Mr. Trump said Tuesday evening. “We’ll be helping the airlines, the cruise lines.”

For Capitol Hill veterans, the moment evoked the frenzy around another major bipartisan bailout package, the $475 billion Troubled Asset Relief Program, signed into law by President George W. Bush amid a financial meltdown in 2008. The program sent billions of dollars to banks and the auto industry but also helped incite a populist backlash that continues to ripple through politics today.

It took time for a more complete understanding to emerge of the various provisions tucked into TARP, as the 2008 bill was called, and their ramifications for various companies and industries.

And it could take longer to fully assess the coronavirus relief package now making its way through Congress, judging from its size and scope. It authorizes lending and other aid more than four times greater than what was ultimately deployed through TARP, and is meant to help bail out a much wider collection of industries, given the near-shutdown in the United States this month of a wide array of industries, from airlines to hotels, restaurants and even auto manufacturing plants.

As with any complex piece of legislation, this one will create winners and losers.

Despite the effort by Democrats to limit access by top federal officials to the bailout funds, the law would still leave room for Mr. Trump to benefit. At least two of the provisions, intended to help the hotel and restaurant industries, could potentially provide financial help to the Trump Organization.

A spokesman for the Trump Organization did not respond to a request for comment. Mr. Trump declined to respond to a question this week about whether his family business intended to take advantage of any of the tax breaks or other benefits included in the legislation.

“I don’t know,” Mr. Trump said at a news conference on Sunday. “I just don’t know what the government assistance would be for what I have. I have hotels.”

Many of these special-interest provisions would be impossible for a casual reader of the legislation to identify. They are written in highly technical language that often does not even mention by name the industry that is supposed to benefit.

For example, on Page 15 of the bill, there is a section with the title “Business Concerns With More Than 1 Physical Location,” although it does not name the actual type of business that it is referring to.

Instead, it says this change in federal law will apply to companies that fit “a North American Industry Classification System code beginning with 72.” What does that code refer to? The hotel and restaurant industry, the codebook makes clear.

The provision says that if a company owns multiple hotels, even if the overall hotel or restaurant chain has more than 500 employees — the limit to qualify for treatment as a small business — it will still be able to take advantage of the small-business benefits offered in the rescue package.

That means loans from the federal government worth up to 2.5 times the firm’s monthly payroll that will not have to be repaid if the hotel company uses them to keep paying employees during any coronavirus shutdowns.

Representatives from the American Hotel & Lodging Association reached out to Senate Republicans and Democrats to push them to insert the language, arguing that it would allow the federal assistance to cover an additional 33,000 hotels, with a total of about one million employees.

The large corporations that own the big brands — like Marriott or Hilton — would not be eligible. But any individual hotel, including from one of these brands, that has fewer than 500 employees would be. Many hotels are owned by franchisees.

MOST SMALL BUSINESS TODAY IS NOT MOM AND POP BUT FRANCHISEES

The provision could benefit the Trump Organization, which operates a relatively small chain, with six hotels in the United States in cities including New York, Washington and Chicago. Several Trump hotels are members of the trade association. Last year Mr. Trump reported annual revenues in 2018 of at least $434.9 million from all of his holdings, including many that are not hotels.

A representative for the trade group said executives at the Trump Organization were not involved in the lobbying effort. Representatives of the Trump Organization did not respond to a question on Wednesday about the provision.

The tweak to the tax code sought by the nation’s retailers and grocers could mean $15 billion a year worth of tax savings for hotels, restaurants, supermarkets and other retailers. Groups representing those industries separately intervened with both Mr. Trump and leaders on Capitol Hill to push lawmakers to include it in the final package.

The provision could potentially benefit Mr. Trump’s companies, among many others, by allowing them to immediately write off money spent on renovations at hotels or restaurants, instead of having to take the deduction over 37 years.

Industry lobbyists have been pushing for the change for more than a year. They have called it a technical correction to the 2017 tax legislation that Mr. Trump signed into law. The provision is simply called “Technical Amendments Regarding Qualified Improvement Property.”

It would allow hotels, restaurants and retailers that have spent money fixing up their properties in the last two years to accelerate the way they write off those expenses, effectively giving them an immediate tax refund, Ms. Bernstein, the industry lobbyist said. They could then use the refund to help cover bills during the crisis. The special tax benefit would be retroactive to 2018 and would last for at least three more years, before it is gradually phased out.

“If you let us amend our returns, we will be getting billions back and it will help us pay our employees and our rents and stay in business until consumers can come back into our stores,” Ms. Bernstein said, echoing the argument she said she made over the phone or via email to lawmakers on Capitol Hill.

The industry also sent a letter last week to Mr. Trump himself, citing the benefit this change in the law would bring for owners of hotels and restaurants and retailers.

Another business that could benefit from the bill is for-profit colleges, which have been championed by some Republicans, but targeted as predatory by Democrats and advocates for student borrowers.

A provision in the bill would allow all colleges to retain federal funds allocated to help educate qualifying students, even if the students in question dropped out because of coronavirus-related emergencies. While the provision applies to all colleges, critics of for-profit colleges contend that, because those schools tend to have higher dropout rates, they would be able to retain more of the money they collect via federal loans to their students than would traditional nonprofit colleges.

“What’s happening now is causing a crisis for all sectors of higher ed, and I understand the intent, but it would disproportionately help for-profit schools because their dropout rates are higher than other segments of higher ed,” said Toby Merrill, the founder of the Project on Predatory Student Lending. While the bill provides a six-month suspension of payments from student borrowers, she called that “insufficient to meet the crisis.”

The bill also contains a six-month extension of federal funding through the end of November for abstinence-only education programs favored by social conservatives who are a critical Republican voting bloc. The extension is coupled with one for sex education programs that provide information about birth control and safe sex, which are supported by reproductive rights groups that tend to back Democrats.

Provisions sought by the nation’s smaller banks, a powerful constituency, were also included in the bill. One change would allow those banks — which represent 95 percent of all the banks in the United States — to have lower requirements for capital reserves, the buffer that financial institutions are required to keep on hand to ensure they remain solvent if they run into trouble.

The industry late last year had fought for the change, and lost. This time the banks used the disaster to reopen the fight and get the lower capital requirements they wanted, arguing that it would allow them to do more lending to small businesses during the coronavirus emergency. An estimated 400 banks in the United States should now be able to give out more loans while operating with less capital, if the change in law is adopted. It would remain in effect as long as the virus emergency continued, although the industry is already discussing looking for ways to make it permanent.

The proposal drew immediate opposition from some analysts, who said it would allow too much risk.

“These banks over the past three years have gotten a lot of what they wanted,” said Gregg Gelzinis, a senior policy analyst at the Center for American Progress, the liberal research organization. “Even though we’re in a crisis scenario right now, it doesn’t seem like that is changing.”

Last-minute complaints threaten $2T Senate coronavirus emergency aid

Bernie Sanders threatens to put hold on virus bill until changes are made
BLAME T PARTY REPUBLICANS NOT BERNIE

A round of 11th-hour objections is throwing a curveball into the Senate's consideration of a mammoth stimulus package.

Senate leadership announced the deal on the $2 trillion bill shortly after 1 a.m., and want to pass it on Wednesday as they face intense pressure to take steps to try to reassure an American public and an economy rattled by the coronavirus.

But a brewing fight over a deal on unemployment provisions is threatening to open the door to a push for broader changes to the bill, which was negotiated by Senate Majority Leader Mitch McConnell (R-Ky.), Minority Leader Charles Schumer (D-N.Y.) and Treasury Secretary Steven Mnuchin.

Sen. Bernie Sanders (I-Vt.), who is running for the Democratic presidential nomination, warned that unless a group of GOP senators back down from their demand for changes to the unemployment insurance benefits, he would slow walk the bill until stronger guardrails were put on hundreds of billions in funding for corporations.

"In my view, it would be an outrage to prevent working-class Americans to receive the emergency unemployment assistance included in this legislation," Sanders said in a statement.

"Unless these Republican senators drop their objection, I am prepared to put a hold on this bill until stronger conditions are imposed on the $500 billion corporate welfare fund to make sure that any corporation receiving financial assistance under this legislation does not lay off workers, cut wages or benefits, ship jobs overseas or pay workers poverty wages," Sanders continued.

Putting a "hold" on a bill would force McConnell to go through days of procedural loopholes that could delay the bill into the weekend or even early next week.

Sanders's decision comes after Sens. Lindsey Graham (R-S.C.), Rick Scott (R-Fla.), Tim Scot (R-S.C.) and Ben Sasse (R-Neb.) raised concerns that the deal on unemployment benefits would "incentivize" individuals not to return to working.

The unemployment provision includes four months of bolstered unemployment benefits, including increasing the maximum unemployment benefit by $600.

But the GOP senators say that the agreement, which they are calling a "drafting error," could prompt individuals who would make less working to leave their jobs, or not actively return to working.

"Unless this bill is fixed, there is a strong incentive for employees to be laid off instead of going to work. ... We must sadly oppose the fast-tracking of this bill until this text is addressed, or the Department of Labor issues regulatory guidance that no American would earn more by not working than by working," Graham, Sasse and Scott, of South Carolina, said in a joint statement.

THIS IS AN OLD REPUBLICAN CONSERVATIVE TROPE, LIKE THE WELFARE MOM IT IS A MYTH BUT A CONVENIENT ONE FOR THOSE WHO WANT WAGE SLAVES TO BE SLAVES WITH NO WAGES NOTE THE MAJORITY OF GOP SENATORS BACKING THIS ARE FROM THE SOUTH.

The back-and-forth comes as senators are scrambling to learn the details of the mammoth package.

Graham said they learned the details of the deal during a 92-minute conference call Senate Republicans had on Wednesday morning. They are asking for a vote on an amendment that would cap unemployment benefits at 100 percent of a person's salary.

Their demand sparked immediate bipartisan pushback.

Sen. Chris Murphy (D-Conn.) tweeted: "Let's not over-complicate this. Several Republican Senators are holding up the bipartisan Coronavirus emergency bill because they think the bill is too good for laid off Americans."

A Senate GOP aide pushed back against the four senators, underscoring the divisions within the caucus, saying that "nothing in this bill incentivizes businesses to lay off employees, in fact it's just the opposite."

"Each state has a different UI program, so the drafters opted for a temporary across-the-board UI boost of $600, which can deliver needed aid in a timely manner rather than burning time to create a different administrative regime for each state. ... It's also important to remember that nobody who voluntarily leaves an available job is eligible for UI," the aide added.

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CRIMINAL NEGLIGENCE
Pastor defies coronavirus order, draws over 1K people to services
NOT A RELIGIOUS RIGHT

Janelle Griffith 3/25/2020

A Louisiana pastor is apparently defying the governor's order against gatherings of more than 50 people by hosting over 1,000 churchgoers at a service Sunday and bringing together hundreds at another service Tuesday, according to the pastor and local media.

© Google Maps Image: The Life Tabernacle Church in Baton Rouge, La.

The pastor, Rev. Tony Spell of Life Tabernacle Church in Baton Rouge, said he does not believe his congregation is at risk of getting COVID-19, the disease associated with the coronavirus, according to CBS affiliate WAFB.

"It's not a concern," Spell told the outlet. "The virus, we believe, is politically motivated. We hold our religious rights dear and we are going to assemble no matter what someone says."

Spell said 1,170 attended his service Sunday, according to WAFB.

"We have 27 buses on Sundays picking up people in a five-parish area," he said.

Spell also told the outlet that police showed up at the church after the service Tuesday night and informed him the National Guard would break up any future gatherings that exceed 50 people.
But a National Guard spokesman in Baton Rouge told NBC News on Wednesday it is not involved in the matter and has no role in enforcing social distancing requirements as set by Gov. John Bel Edwards.

Spell did not immediately return a request for an interview Wednesday.

NBC News reached out to the Central Police Department about the apparent violation of the governor's order but did not immediately hear back.

An online petition calling for Spell to be arrested and prosecuted has more than 4,000 signatures. The petition claims 1,800 people attended Spell's service on Sunday.

The petition says the pastor should be "charged with 1800 counts of reckless endangerment for a start, for the countless lives he will be brutalizing and even ending with his selfishness and ignorance."

On March 15, the Centers for Disease Control and Prevention recommended that gatherings of 50 people or more — including conferences, festivals, parades, concerts, sporting events and weddings, — be canceled or postponed for the next 8 weeks to slow the spread of the coronavirus.

A day later, President Donald Trump announced that his administration recommended all Americans, "including the young and healthy," avoid gathering in groups of more than 10 people, discretionary travel and eating and drinking at bars and restaurants. That same day, the Louisiana governor announced he was taking "significant measures" of his own.

"Following additional guidance from the CDC, gatherings of more than 50 people are no longer permitted," Gov. Edwards said in his March 16 announcement. "These limitations were difficult to make, but they are necessary to slow the spread of COVID-19, protect the health of Louisianans and flatten the curve."

Edwards went further on Sunday, issuing a stay-at-home order for the state.

He said Tuesday that his state has more coronaviruses per capita than any others except New York and Washington, and he requested that the federal government declare Louisiana a major disaster.

More than 1,300 cases of the coronavirus had been reported in Louisiana as of noon Wednesday and at least 46 deaths.

AMERICAN EXCEPTIONALISM

How the World’s Richest Country Ran Out of a 75-Cent Face Mask


Farhad Manjoo 3/25/2020


Why is the United States running out of face masks for medical workers? How does the world’s wealthiest country find itself in such a tragic and avoidable mess? And how long will it take to get enough protective gear, if that’s even possible now?

© Jovelle Tamayo for The New York Times Some health care workers have resorted to sewing their own masks as supplies fall short.

I’ve spent the last few days digging into these questions, because the shortages of protective gear, particularly face masks, has struck me as one of the more disturbing absurdities in America’s response to this pandemic.

Yes, it would have been nice to have had early, widespread testing for the coronavirus, the strategy South Korea used to contain its outbreak. It would be amazing if we can avoid running out of ventilators and hospital space, the catastrophe that has befallen parts of Italy. But neither matters much — in fact, no significant intervention is possible — if health care workers cannot even come into contact with coronavirus patients without getting sick themselves.

That’s where cheap, disposable face masks, eye protection, gloves and gowns come in. That we failed to procure enough safety gear for medical workers — not to mention for sick people and for the public, as some health experts might have recommended if masks were not in such low supply — seems astoundingly negligent.

What a small, shameful way for a strong nation to falter: For want of a 75-cent face mask, the kingdom was lost.

I am sorry to say that digging into the mask shortage does little to assuage one’s sense of outrage. The answer to why we’re running out of protective gear involves a very American set of capitalist pathologies — the rise and inevitable lure of low-cost overseas manufacturing, and a strategic failure, at the national level and in the health care industry, to consider seriously the cascading vulnerabilities that flowed from the incentives to reduce costs.

Perhaps the only way to address the shortfall now is to recognize that the market is broken, and to have the government step in to immediately spur global and domestic production. President Trump, bizarrely, has so far resisted ordering companies to produce more supplies and equipment. In the case of masks, manufacturers say they are moving mountains to ramp up production, and some large companies are donating millions of masks from their own reserves.

But given the vast global need for masks — in the United States alone, fighting the coronavirus will consume 3.5 billion face masks, according to an estimate by the Department of Health and Human Services — corporate generosity will fall short. People in the mask business say it will take a few months, at a minimum, to significantly expand production.

“We are at full capacity today, and increased production by building another factory or extending further will take anywhere between three to four months,” said Guillaume Laverdure, the chief operating officer of Medicom, a Canadian company that makes masks and other protective equipment in factories around the world.

And though some nontraditional manufacturers like T-shirt factories and other apparel makers have announced plans to rush-produce masks, it’s unclear that they will be able to meet required safety standards or shift over production in time to answer demand.

Few in the protective equipment industry are surprised by the shortages, because they’ve been predicted for years. In 2005, the George W. Bush administration called for the coordination of domestic production and stockpiling of protective gear in preparation for pandemic influenza. In 2006, Congress approved funds to add protective gear to a national strategic stockpile — among other things, the stockpile collected 52 million surgical face masks and 104 million N95 respirator masks.

But about 100 million masks in the stockpile were deployed in 2009 in the fight against the H1N1 flu pandemic, and the government never bothered to replace them. This month, Alex Azar, secretary of health and human services, testified that there are only about 40 million masks in the stockpile — around 1 percent of the projected national need.

As the coronavirus began to spread in China early this year, a global shortage of protective equipment began to look inevitable. But by then it was too late for the American government to do much about the problem. Two decades ago, most hospital protective gear was made domestically. But like much of the rest of the apparel and consumer products business, face mask manufacturing has since shifted nearly entirely overseas. “China is a producer of 80 percent of masks worldwide,” Laverdure said.

Hospitals began to run out of masks for the same reason that supermarkets ran out of toilet paper — because their “just-in-time” supply chains, which call for holding as little inventory as possible to meet demand, are built to optimize efficiency, not resiliency.

“You’re talking about a commodity item,” said Michael J. Alkire, president of Premier, a company that purchases medical supplies for hospitals and health systems. In the supply chain, he said, “by definition, there’s not going to be a lot of redundancy, because everyone wants the low cost.”

In January, the brittle supply chain began to crack under pressure. To deal with its own outbreak, China began to restrict exports of protective equipment. Then other countries did as well — Taiwan, Germany, France and India took steps to stop exports of medical equipment. That left American hospitals to seek more and more masks from fewer and fewer producers.

People in the industry assured me they would prepare better next time. “We are laserlike focused to ensure that our health care systems are never in this scenario again,” Alkire told me. “There will be a lot more domestic manufacturing of these products going forward.”

I don’t doubt it — but that we did not plan, as a nation, for this entirely predictable shortage makes me wonder what other inevitable pothole is lurking out there for all to trip over. Getting enough protective gear was among the cheapest, most effective things we could have done to slow down the pandemic. That we failed on such an obvious thing reveals an alarming national incapacity to imagine and prepare for the worst.

We will get enough masks in time for the next disaster. But wouldn’t it be nice, for once, if we prepared for trouble before it hit us in the face?

FOR PROFIT VS FOR PUBLIC GOOD

Trump's refusal to use wartime powers to direct scarce medical supplies has left states fighting it out


By Don Lee and Jennifer Haberkorn, Los Angeles Times
3/25/2020

WASHINGTON — When President Donald Trump invoked emergency war powers last week to fight the coronavirus outbreak, many were hopeful that the federal government would take charge in addressing the nation’s dire shortage of ventilators, protective masks and other critical gear for patients and medical staff.

 © Irfan Khan/Los Angeles Times/TNS Teresa Olivas prepares single face mask bags at Prep and Save store in Upland, Calif. on March 17, 2020. Customers scared of lockdown due to coronavirus cleaned out shelves carrying survival food, hand sanitizer and masks.

But Trump has not made actual use of the powers granted in the Korean War-era law known as the Defense Production Act, even though state governors, health experts and lawmakers of his own party have appealed to the administration to employ that authority to bulk up production of medical equipment and supplies, and just as critically, to ensure that they’re distributed to areas of most urgent need.

Trump’s reluctance to take a more assertive role — instead forcing states to fend for themselves and bid against one another — has created confusion and competition. And it has at times tied the hands of his own administration officials designated to lead the White House response to the pandemic.

The head of the Federal Emergency Management Agency, Peter Gaynor, said Tuesday that he was using the DPA’s allocation provision to procure about 60,000 coronavirus test kits and to take control over their distribution. He said it was the first time such a step had been taken in the battle against the coronavirus.

But later in the day, Trump seemed to disavow the actual use of the law. And by Tuesday night, a FEMA’s press secretary, Lizzie Litzow, issued a statement saying, “At the last minute we were able to procure the test kits from the private market without evoking the DPA.”

Among its provisions, the act authorizes the government to ensure that its orders for critical material get first priority from producers. While the DPA does not empower the government to take ownership of companies, it was used during the Korean War to regulate production and prices of some vital materials produced by private companies. Proponents of the act want Trump to use it now to direct factories to ramp up production of needed medical supplies and to prevent price-gouging.

Trump last week gave formal notification that he was prepared to use the law, designating ventilators and personal protective equipment as necessary, but he has since insisted his administration has not needed to use the full weight of the law, saying he didn’t want to nationalize American businesses.

“Private companies are heeding our call to produce medical equipment and supplies because they know that we will not hesitate to invoke the DPA in order to get them to do what they have to do.,” Trump said at a coronavirus briefing Tuesday.

“It’s called leverage. You don’t have to use it. … But the threat of it being there is great leverage, and companies are doing as we ask. … They’re coming through and they’re calling us.”

The status of the 60,000 test kits — a fraction of what’s needed — was unclear. Gaynor did not identify the company or companies from which FEMA was buying the kits. But he told CNN early Tuesday — before the about-face — that FEMA would be using the law “for the first time today … to get our hands on” those kits to allocate them where they’re most needed.

A growing number of lawmakers from both parties have been pushing Trump to make use of the law’s broad authority given the scarcity of ventilators, medical masks, gowns and other protective gear in areas where the need is greatest.

“I don’t want to see doctors having to make a choice of who gets to live and who has to die because they don’t have the equipment to save their lives,” said Sen. Ted Cruz, R-Texas, on his podcast.

“If we wake up two weeks from now and instead of 11,000 cases, we have 200,000 cases or a million cases, it might be too late then,” Cruz said.

Sen. Michael Bennet, D-Colo., said he was glad Trump invoked the act last week but disappointed it hasn’t been put into effect.

“Instead of using them, he’s equivocating,” he said Monday, citing Trump’s remarks that companies are voluntarily boosting production. “We don’t have 18 months. It’s literally life and death.”

Some lawmakers have become so frustrated that they’ve introduced a bill demanding the act’s usage in the hopes of expediting the production of medical equipment. The bill would require a purchase order of 300 million medical N95 masks and other personal protective equipment, and that the National Response Coordination Center conduct a national assessment on current medical supply needs and fill in missing gaps.

“The shortage of medical supplies like masks and ventilators in hospitals in California and across the nation is unacceptable. It’s past time the president ensures health care workers have the supplies and resources they need to protect themselves and combat the coronavirus pandemic,” said Sen. Kamala Harris, D-Calif., who with Tammy Baldwin, D-Wis., introduced the bill.

The administration’s strategy of invoking but not using the wartime power appears in part designed to meet its political needs. At Tuesday’s briefing, for example, Vice President Pence did not directly contradict Gaynor’s comments but said that “at this point no one said no” to federal requests or orders.

Trump’s public posture aligns with that of many conservatives and the U.S. Chamber of Commerce, the most powerful voice of corporate America, which dismisses the need for such government intervention.

Private companies have stepped up on their own to increase production and, where they can, to modify operations to make products that are needed, the chamber said.

The idea that “the government would do a better job in building all of this stuff and distributing it … is a hard claim to defend given the government’s track record,” said Neil Bradley, chief policy officer at the chamber.

“The folks who actually know how to build things are raising their hand and saying, ‘We can do it.’ That’s happening right now. Companies are doing this,” he said.

But switching from normal operations to meet a sudden emergency requires businesses to spend money on new equipment and other needs.

In the past, companies have been reluctant to make such new investments quickly and on their own when they could not be sure they could recover those expenses. The DPA permits the government to give guaranteed loans or install equipment to protect the companies financially.

It also allows the government to control sales and distribution of the new products, to set priorities and assure that supplies go where the need is greatest.

The Trump administration has highlighted a number of companies that have come forward on their own. Pence said Apple was donating 9 million N95 protective masks for health care professionals.

Others like General Motors and Ford are using their manufacturing capabilities to help boost production of medical equipment such as ventilators, respirators and face shields, although it will take two to three months for some of the products to roll out of the factory.

“I think they are responding to market needs. It’s in their financial interest to do so,” said Joshua Aguilar, a Morningstar analyst, referring to 3M’s plan to double the production of N95 masks over the next year.

But many state officials, medical experts, and economists have been skeptical that relying on volunteers and market forces would assure that production of emergency supplies were produced quickly enough or in sufficient volume to meet the need. Governors have urged the administration to take control of the distribution of vital medical supplies and stop bidding wars.

New York Gov. Andrew Cuomo has grown increasingly angry as COVID-19 cases have exceeded 26,000 in his state, about half of the infections recorded in the United States. On Tuesday he lashed out at the Trump administration’s failure to use the DPA, saying the law was made precisely for a time like now.

“When we went to war, we didn’t say, ‘Any company out there want to build a battleship? … Maybe a couple of you guys can get together and build a battleship … maybe, you think?’” he said, dripping with sarcasm. “That’s not how you did it. The president’s said it’s a war. It is a war. Well, then, act like it’s a war.”

Cuomo said that New York has received only 400 ventilators from the federal government. “FEMA says, ‘We’re sending 400 ventilators.’ Really? What am I going to do with 400 ventilators when I need 30,000?”

Jamie E. Baker, former legal adviser to the National Security Council and a professor at Syracuse University, said: “If there is a gap between voluntary production and what is needed, or anticipated to be needed, the DPA is the mechanism to close that gap.”

Before the abrupt reversal by FEMA, its chief, Gaynor, said Tuesday that the agency planned to use the wartime powers also in the production of 500 million face masks, inserting DPA provisions into contracts with companies providing the masks.

One of the companies that is waiting to sign a contract with FEMA is Los Angeles Apparel, a South-Central clothing maker that is part of a consortium, including HanesBrands and Parkdale Mills. The companies are teaming up to produce masks, though not the medical kind needed for front-line health care professionals.

Dov Charney, Los Angeles Apparel’s founder, said he has a preliminary agreement with FEMA to produce an as-yet undetermined amount of washable masks for what he expects will be about $2 apiece.

Charney said his 500-employee operation, which makes sweatshirts, T-shirts and other apparel, already has sold or given away more than 30,000 masks.

He said he expected face masks to be a long-term product line for the company. And he welcomed a contract with FEMA, with a guaranteed purchase price.

“I think there’s a profit in all this,” he said.

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©2020 Los Angeles Times