Hooray! Feds Rush Medical Supplies From China So States Can Over-Pay For Them!

If they can get 'em at all.

As we keep pointing out, Americans aren't just struggling with a deadly pandemic, we're also suffering because our more-or-less elected government keeps botching the response to COVID-19, especially when it comes to obtaining and distributing scarce medical supplies. Last week, we learned a little moreabout how the federal government is "helping" to get more medical supplies to the states and hospitals that need them the most: by helping big medical supply companies fly the supplies in from China and then sell them to the highest bidder. Remember this guy, Rear Admiral John Polowczyk? He's in charge of FEMA's "Supply Chain Stabilization Task Force," and he explained to CBS reporter Weijia Jiang last Thursday that the government isn't about to go interfering with the commercial supply chain apart from making it move a little faster:

This is remarkable. The US has set up an airbridge for PPE & med supplies to the US from abroad. But in answer to q… https: //t.co/RxDHlgzNqc

— Josh Marshall (@Josh Marshall) 1585875673.0 

Why do states have to bid against each other? Easy, says Polowczyk: The flights involve "commercial product that would enter the commercial system" and then be sold however it would normally, so "I'm not here to disrupt a supply chain." If that means states have to fight each other and drive up prices, that's the breaks.

And now here's the New York Times with a story on the chaos resulting from handing FEMA the job of "distributing" medical supplies. The takeaway is that FEMA has added one more source of disarray to an already insane market, in which the administration has spent weeks insisting that states have only themselves to blame if they're short of supplies, because it's not the federal government's job to manage a national emergency. But then on top of that, FEMA's new involvement may actually mean that states that were working to secure their own supplies find them being grabbed up by FEMA instead. Hell of a way to run a pandemic response!

The big distributors of medical supplies have been granted an exemption from antitrust law so they can work together to ship stuff to the USA, and Adm. Polowczyk is very proud that, with FEMA's help, the time needed to get orders from overseas to the USA has been cut from 37 to 17 days, on average. But once the stuff is here, then it's up to the middlemen to sell the stuff to the highest bidder.

Oddly, the Times report indicates that FEMA is intervening in where those shipments end up more than Polowczyk suggested when he said the shipments were "primarily" commercial products going their merry way through the nation's top medical supply distributors. Instead,

FEMA allows those distributors to sell about half of the equipment to companies and counties that had previously placed orders. The other half of the shipments must be sold to counties that the federal government prioritizes by the severity of the outbreak, based on data compiled by the Centers for Disease Control and Prevention.

The federal government will also soon save 10 percent of the supplies on each flight for the national stockpile, according to officials. A Korean War-era production act also allows the federal government to force companies to prioritize its order over another client's, whether it be a private hospital or another nation.

Now, if that really is the case and the supplies are being prioritized according to where the CDC says the need is highest, we'd be inclined to say hooray for big government picking winners and losers. And then to add that should have been the case for pretty much all the supplies, from the beginning of the outbreak. The problem is that FEMA is — like so much else in the administration's coronavirus response — making things up on the fly. Or as the Times puts it,

[The] new effort by the administration to create a hybrid system of distribution — divided between the federal government, local officials and private health care companies — has led to new confusion, bordering on disarray, and charges of confiscation.

Consider, for instance, these examples of local governments doing exactly what Trump had been telling them to do: buy their own stuff and not rely on the federal government.

After Somerset County, N.J., secured an order of 35,000 N95 and other surgical masks, the shipment was taken by the federal government, Shanel Y. Robinson, the county's freeholder director, told The Franklin Reporter & Advocate.

Garren Colvin, the head of the board for the Kentucky Hospital Association, wrote last week to members of Congress saying that four shipments of protective gear were taken by FEMA before they could be delivered to the hospitals that had originally contracted for the supplies.

And then there's Massachusetts, where, the Boston Globe   reports, Sen. Elizabeth Warren is formally demanding an answer to why the feds have

seized several of Massachusetts's recent orders for personal protective equipment.

That included a shipment of three million N95 masks the state had negotiated to buy from BJ's Wholesale Club, only to have federal officials impound them, and two separate orders for ventilators and hundreds of other respirators the federal government claimed.

Needless to say, this wouldn't be a Trump Story without news that The Boy Prince has also been helping to interfere with the sacred supply chain, CDC priorities be damned, as the Times details:

Advisers to Jared Kushner, the president's son-in-law, have surprised FEMA officials in recent weeks to deploy supplies to communities after the area's representatives got through to Mr. Trump, even if the state had not yet gone through the formal process to secure supplies.

For instance, after Mr. Trump heard from friends that the New York public health system was running low on critical supply, Mr. Kushner directed agency officials to ensure that there were enough N95 masks in the administration's inventory, Mr. Kushner said at a White House briefing.

Mind you, this is all taking place in the context of Trump telling governors — still! — that the federal government isn't there to help them at all except as a last resort. Go buy your own stockpiles, he keeps saying. So what does FEMA have to say about its interference in the supply chain? Well, that's too bad, we're prioritizing now.

"FEMA realizes that prioritizing P.P.E. deliveries to Covid hot spots can have the unintended consequence of disrupting the regular supply chain deliveries to other areas of the country that are also preparing for the coronavirus," said Lizzie Litzow, a FEMA spokeswoman, adding that the agency was not seizing any shipments.

Silly governors and local officials must all be hallucinating! And strangely enough, the equipment shortages continue, as Illinois Gov. J.B. Pritzker confirmed in an interview on PBS's "Newshour" yesterday. After noting that Illinois has only received about a tenth of what it had requested from the federal stockpile, he said FEMA's "air bridge" hadn't succeeded in anything but more bidding wars:

Gov @GovPritzker confirms that the federal ‘Air Bridge’ flights from China, organized by the White House taskforce,… https: //t.co/4azVgAVHZW

— Josh Marshall (@Josh Marshall) 1586222914.0 

We're bidding, unfortunately, for all of these items of equipment against the federal government and against the other states and against other countries, because what the White House has done is created — you know, they call this the air bridge, where they're bringing stuff back from China to the United States, and then they're delivering it to private companies in the United States, not to the states.

And they're letting all of us bid against each other for those goods that are owned by the private companies. So we have just gone around all that and gone directly to manufacturers, wherever we could, so that we can fulfill our needs.

But don't you blue state governors worry: Maybe once the states Trump likes have all the medical supplies they need, those Republicans governors will sell you some leftovers, if you can meet their price.

Have you considered being nicer to Dear Leader? You might try that.

[ NYT / TPM / Boston Globe / White House / NPR ]

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