As GOP seeks to shield firms from COVID-19 lawsuits, Mnuchin threatens jail for firms seeking emergency loans

In President Trump's first mention of his new executive order designating meat processing facilities "critical infrastructure," he said Tuesday morning it was prompted by "a very unique circumstance because of liability." Trump hasn't explained which part of the Defense Production Act could allow him to compel meat plants to reopen or remain open amid COVID-19 outbreaks, and it's not clear he can exempt the companies from federal or state safety regulations. But the executive order states that as its goals.

"If these meat plants can't be held liable, there is no reason for them to take measures to ensure workers are safe," Kim Cordova, president for union workers at JBS beef plant in Greeley, Colorado, tells The Washington Post. "This is insane. If these workers are essential, protect them."

Any workable legal liability shield for companies who stay open or reopen without adequate measures to protect workers and customers would have to come from Congress. That is a key ask of business lobbyists, and Senate Majority Leader Mitch McConnell (R-Ky.) has named it as a priority in the next round of coronavirus relief legislation. "Before we start sending additional money down to states and localities, I want to make sure that we protect the people we've already sent assistance to, who are going to be set up for an avalanche of lawsuits if we don't act," he said Monday.

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

Business groups say the protections would be temporary, but House Speaker Nancy Pelosi (D-Calif.) said Tuesday she doesn't think "there's any interest in having any less protection for our workers."

While Trump and congressional Republicans are looking to protect businesses from lawsuits, Treasury Secretary Steven Mnuchin threatened companies with "criminal liability" Tuesday if they applied for Paycheck Protection Program loans under false pretenses. The PPP, which has run through about $660 billion, was designed for small businesses with fewer than 500 workers, but loopholes allowed larger companies to get multi-million-dollar grants.

Munchin, put in charge of implementing the law, told banks to decide where the loan money went and had companies "self certify" they met the Treasury's vague guidelines. Mnuchin said the Small Business Administration will audit all loans of $2 million or more. More than 100 companies have said they got loans of at least $2 million, and some have opted to return it due to bad publicity, but most of the recipients of the loans aren't publicly known.