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Politics

Elizabeth Warren presses Janet Yellen to deal with crypto market threats

Elizabeth Warren presses Janet Yellen to address crypto market threats

Senator Elizabeth Warren, D-Mass., Holds a press conference outside of the Capitol on Tuesday, April 27, 2021 to reinstate the Universal Childcare and Early Education Act.

Tom Williams | CQ Roll Call, Inc. | Getty Images

Senator Elizabeth Warren called on Treasury Secretary Janet Yellen Tuesday to identify and address cryptocurrency risks and create a “comprehensive and coordinated” framework through which federal agencies can continuously regulate virtual coins.

Warren, a member of the Senate Banking Committee and longtime critic of the country’s largest banks, urged the Treasury Secretary to use her powers on the Financial Stability Oversight Council to create a more secure crypto market.

“The FSOC must act quickly to use its legal powers to address the risks of cryptocurrencies and regulate the market to ensure the safety and stability of consumers and our financial system,” the Massachusetts Democrat wrote in a letter to Yellen .

“As the demand for cryptocurrencies continues to grow and these assets become more embedded in our financial system, consumers, the environment and our financial system are exposed to increasing threats,” she added.

Warren named five risks posed by an under-regulated crypto market. In her words it is:

  • Exposure to hedge funds and other investment vehicles with no transparency
  • Risks for banks
  • Unique threats from stablecoins
  • Used in cyber attacks that can disrupt the financial system
  • Risks from decentralized financing

A Treasury Department spokesman did not immediately respond to CNBC’s request for comment.

Warren’s letter also came as she and other lawmakers held a hearing on the Senate Banking Committee entitled “Cryptocurrencies: What Are They Good For?”

Senators will grill Coin Center Executive Director Jerry Brito, Filecoin Foundation Chair Marta Belcher, and Angela Walch, a research fellow at University College London’s Center for Blockchain Technologies, during Tuesday’s hearing.

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“Cryptocurrencies and other digital assets present significant risks right now, and the risks they pose are increasing as they permeate the traditional financial system and more and more people are investing,” Walch told lawmakers in a written statement. Her Twitter bio advises readers “not to own crypto”.

Warren’s letter is the latest in a series of calls from Capitol Hill for tighter market regulation.

Perhaps the most prominent example came in February when lawmakers on both sides of the political aisle pecked executives at brokerage firm Robinhood, social media website Reddit, market maker Citadel Securities, and video game retailer GameStop about “gamifying” stock trading.

However, regulating crypto markets has proven to be a more difficult task given the sheer number of different assets as well as the novelty of the technology behind digital currencies. To date, it is unclear which body – the FSOC, the Securities and Exchange Commission, or Congress itself – will ultimately be responsible for the day-to-day oversight of crypto trading.

That’s probably why Warren addressed her letter to Yellen in her role at FSOC.

Established after the 2008 financial crisis, the FSOC is headed by the Treasury Secretary and brings together 10 state financial regulators, including the Federal Reserve, the Securities and Exchange Commission, and the Commodities Future Trading Commission.

The council’s role is to identify risks to the financial industry and coordinate a regulatory response between cabinet departments and other agencies, as no single regulator is responsible for overseeing and addressing global risks to financial stability.

The SEC, under the new leadership of Chairman Gary Gensler, is currently considering approving exchange-traded funds that track Bitcoin’s performance. Many investors say that given the recent rally in Bitcoin and the extensive amount of futures and other derivatives trading in the space, the decision cannot come soon enough.

So far, Gensler has said investor protection should apply to crypto exchanges, and the Federal Reserve is considering issuing central bank digital currency.

Republicans on the Senate Banking Committee, including ranking member Pat Toomey of Pennsylvania and Cynthia Lummis of Wyoming, argue that Congress should better understand the potential uses of cryptocurrencies while keeping illegal activity at bay.

Toomey and Lummis are investigating the value and possible uses of so-called stablecoins or digital currencies that are linked to national currencies such as the US dollar.

“It’s important to note that people have raised legitimate issues with cryptocurrencies,” Toomey said in prepared remarks on Tuesday morning. “But we shouldn’t lose sight of the enormous potential benefits that distributed ledger technology offers.”

“We should also keep in mind that private innovation has made most of these developments possible,” he added. “We shouldn’t suppress the concepts of individual entrepreneurship and empowerment that made this innovation possible.”

– CNBC’s Stephanie Dhue contributed to this article.

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Politics

Biden presses Putin to disrupt cybercriminals in Russia

Biden presses Putin to disrupt cybercriminals in Russia

United States President Joe Biden speaks before signing an executive order in the State Dining Room of the White House in Washington, DC, the United States, on Friday, July 9, 2021.

Alex Edelmann | Bloomberg | Getty Images

WASHINGTON – President Joe Biden in a phone call Friday morning urged Russian President Vladimir Putin to take action to contain recent ransomware attacks by groups based in Russia.

“I made it very clear [Putin] that when a ransomware operation comes off its soil despite not being state sponsored, the United States expects that if we give them enough information to act who it is, we expect them to act said Biden at the White House on Friday afternoon.

When asked by a reporter whether there would be “consequences” for such attacks, Biden replied, “Yes”.

The US and Russia, according to the President, have “now regularly set up a means of communication in order to be able to communicate with each other when each of us thinks that something is happening in another country that affects our home country”.

Overall, the call “went well, I’m optimistic,” said Biden.

The conversation came just days after a massive new cyber attack by the REvil group believed to be based in Russia.

The hacking gang is demanding $ 70 million in cryptocurrency to unlock data from the attack that spread to hundreds of small and medium-sized businesses in a dozen countries.

A senior government official said Friday that the United States will take “action” to respond to the attack.

“We will not telegraph what exactly these actions will be. Some will be obvious and visible, others may not, but we expect these to take place in the coming days and weeks,” said the official, who asked for anonymity discuss sensitive negotiations.

The official spoke just moments after Biden, who boarded Air Force One en route to Delaware, was asked if it made sense for the United States to attack the actual servers that are hosting ransomware attacks. Biden replied, “Yes.”

The latest REvil attack is part of a series of serious ransomware attacks carried out by groups originating in Russia this spring and summer.

In May, REvil targeted JBS, the world’s largest meat supplier. The company eventually paid a $ 11 million ransom, but not before it temporarily ceased all of its U.S. operations.

Earlier that month, another cybercriminal targeted the operator of the country’s largest gas pipeline, the Colonial Pipeline. The attack forced the company to shut down a pipeline roughly 5,500 miles long, cutting fuel supplies to the east coast of almost half.

As of early Friday afternoon, the Kremlin had not yet published its own reading of the Biden Putin appeal, so it is unclear how the Russian president reacted to Biden’s pressure.

White House press secretary Jen Psaki told reporters Friday the United States had no new information suggesting the Russian government was directly responsible for the attacks.

Putin has always denied any involvement or direct knowledge of ransomware attacks from Russia.

However, US officials say the idea that Putin does not know who these attackers are is not credible as he has a tight grip on Russia’s intelligence services and its more opaque network of contractors.

In June, Biden met personally with Putin in Geneva, where he warned the Russian President to crack down on cyberattacks from Russia.

US President Joe Biden gestures at a press conference after the US-Russia Summit with Russia’s President Vladimir Putin on June 16, 2021 in Geneva, Switzerland.

Kevin Lamarque | Reuters

There, Biden said he presented Putin with a list of critical infrastructures in the United States that, if attacked by Russia-based cybercriminals, would pose a serious national security threat to the United States

“Certain critical infrastructures should be closed to attacks, cyber or other means,” said Biden after the meeting. “I gave them a list, 16 specific entities that are defined as critical infrastructure under US policy, from the energy sector to water systems.”

“So we agreed to hire experts in our two countries to work on specific agreements on what is forbidden and investigate specific cases that come from other countries or from one of our countries,” he said.

By identifying critical infrastructure as locked down, Biden also circled targets that, if attacked by state or non-state actors, would likely deserve a government response.

The White House has so far declined to detail the retaliatory measures taken by the United States in several recent attacks against the cybercriminals themselves on the grounds that such information must remain confidential.

During the phone call on Friday, Putin and Biden also praised their teams’ joint work after the meeting in Geneva, the White House said.

This work led to an important vote in the UN Security Council on Friday to resume the delivery of humanitarian aid to Syria.

4:00 p.m. – This story has been updated to include President Joe Biden’s comments on the call, as well as remarks from a senior administrator.

– CNBC’s Kevin Breuninger contributed to this report.

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Health

Sen. Warren presses PhRMA foyer group on efforts to dam vaccine patent waivers

Sen. Warren presses PhRMA lobby group on efforts to block vaccine patent waivers

Sen. Elizabeth Warren, D-Mass., conducts a news conference outside the Capitol to reintroduce the Universal Child Care and Early Learning Act, on Tuesday, April 27, 2021.

Tom Williams | CQ-Roll Call, Inc. | Getty Images

Democratic Sen. Elizabeth Warren is pressing the CEO of a major pharmaceutical trade group on its lobbying efforts against a proposal to waive intellectual property rights for Covid-19 vaccines that would help boost production of the shots for poorer nations.

Warren and other lawmakers asked how much money the Pharmaceutical Research and Manufacturers of America, or PhRMA, and its member companies spent this year lobbying Congress and White House officials in opposition to the waiver, in a letter sent Wednesday to PhRMA CEO Stephen Ubl that was obtained by CNBC.

The Biden administration said in early May it would support waiving the World Trade Organization’s Trade Related Intellectual Property Rights, or TRIPs, agreement. PhRMA, whose members include Covid vaccine makers AstraZeneca, Pfizer and Johnson & Johnson, is trying to block the waiver.

Removing patent protections on Covid vaccines would allow other drug companies to manufacture the lifesaving shots. Drugmakers worry that could set a precedent for future products and end their lucrative monopolies over sales of their new medicines.

Warren also asked the trade group about its attempts to block a bill from House Democrats that would allow Medicare to negotiate directly with manufacturers for lower drug prices.

“PhRMA and other pharmaceutical companies have pushed the Biden Administration to oppose the TRIPS waiver, arguing that it would “undermine the global response to the pandemic,”‘ Warren and other lawmakers wrote. The industry also said drug pricing provisions of the American Rescue Plan would “lead to fewer new cures and treatments,” and it opposed Medicare Part D price negotiation, the letter reads.

“While taking credit for the development of new COVID vaccines — which were developed with massive infusions of federal funds — the pharmaceutical industry has not backed off of its efforts to block drug pricing proposals and maintain the status quo,” the lawmakers added.

The lawmakers gave the trade group until June 30 to respond.

In a statement to CNBC, PhRMA spokesman Brian Newell said the trade group was reviewing the letter.

“We will continue our efforts to work with policymakers on solutions to lower what patients pay out of pocket for prescription medicines and ensure equitable global access to COVID-19 vaccines,” he said.

Warren’s letter comes as global groups, including the World Health Organization, are urging wealthy countries and drugmakers to get Covid shots to low-income and lower-middle-income countries, some of which are witnessing an increasingly worrying rise in new infections.

Ken Frazier, chairman and chief executive officer of Merck & Co., from left, Stephen Ubl, chief executive officer of Pharmaceutical Research and Manufacturers of America (PhRMA), and Robert Hugin, chairman of Celgene Corp., arrive to a news conference outside the White House following a meeting with U.S. President Donald Trump, not pictured, in Washington, D.C., U.S., on Tuesday, Jan. 31, 2017.

Andrew Harrer | Bloomberg | Getty Images

Many countries and drugmakers have made pledges to share millions of doses around the world. President Joe Biden announced last week that his administration would donate 500 million vaccine doses produced by Pfizer to other nations.

The pharmaceutical industry has previously said the TRIPS waiver would compromise safety, weaken supply chains and sow confusion between public and private partners.

In the first three months of this year, pharma companies have spent a record $92 million on lobbying, according to data compiled by the Center for Responsive Politics, a nonpartisan campaign finance research group in Washington. PhRMA spent $8.6 million this year on lobbying after spending $25.9 million in 2020, according to its data.

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Politics

Broad Coalition of Democrats Presses Biden to Broaden Medicare

Broad Coalition of Democrats Presses Biden to Expand Medicare

WASHINGTON – A broad coalition of Democrats from across the ideological spectrum plans on Thursday to begin what it promises to be a loud and sustained campaign to pressure President Biden to add a major Medicare addition to his infrastructure package.

More than 150 House Democrats – including Representative Pramila Jayapal of Washington, chairman of the progressive wing of the House, and Representative Jared Golden of Maine, one of the chamber’s most centrist Democrats – have teamed up in what is far from certain to draw Republican opposition but contains suggestions that are popular with a broad segment of the electorate.

Disappointed that Mr Biden has not yet responded to an election promise to expand Medicare benefits, members of the group, which together represent nearly 70 percent of House Democrats, have signed a letter starting their print campaign. The organizers say it will contain opinion pieces and press events. Representatives Conor Lamb from Pennsylvania and Joe Neguse from Colorado are also leading the push.

“It is really unusual for a health proposition to reach this intensity,” Ms. Jayapal said in an interview.

At the heart of the plan is to call for the Medicare Eligibility Age to be lowered from 65 to 60 and to enroll approximately 23 million Americans on the federal senior health program, which will cost $ 200 billion over 10 years. Lawmakers are also pushing for Medicare benefits to be extended to include teeth, eyesight and hearing, which would cost approximately $ 350 billion over 10 years.

Legislators say the third element of their package more than offsets the cost: Medicare’s power to negotiate drug prices. Ms. Jayapal said change – one that Democrats have been unsuccessful in promoting for years – could generate as much as $ 650 billion in a decade, although the Congressional budget bureau has estimated the savings at about $ 450 billion over that period.

Mr Golden, who has historically opposed some large-ticket spending, including the nearly $ 1.9 trillion stimulus bill, said the Department of Veterans Affairs, which has the power to negotiate drug prices for veterans, is paying far less for prescription drugs than the rest of the government.

The Government Accountability Office found that the prescription drug division paid an average of 54 percent less than Medicare in 2017.

Lawmakers have made Zoom calls with White House officials over the proposal, which they hope Mr Biden will include in a large spending package that can lead the Senate through accelerated budget reconciliation this year.

It is not clear whether Mr Biden and other Democrats in Congress will accept the move, as Democratic leaders have focused on competing efforts to achieve a permanent increase in health subsidies under the Affordable Care Act in the Boom Act. There is widespread support for this proposal, including from hospitals who want to get the higher private insurance rates and insurers who want more people to buy their products. Any attempt to expand Medicare is likely to encounter opposition from the same groups.

Updated

May 26, 2021, 9:17 p.m. ET

However, Ms. Jayapal argued that the two health care proposals were compatible. She said negotiating lower drug prices could generate enough money to pay for the changes to the Affordable Care Act as well. If not, “there are many sources of income that are possible and necessary,” she said.

The Medicare proposals have proven popular with so-called Front Democrats – those who represent conservative districts. More than a dozen have joined the effort, underscoring its bipartisan appeal.

After meeting with White House officials on the matter, Neguse argued that Democrats could go further and lower the Medicare Eligibility Age to 55 to cover more than 40 million additional people.

“Many seniors in our nation cannot treat their illnesses because Medicare benefits are not as comprehensive as they should be,” he said.

Democrats say that at least 75 percent of Medicare beneficiaries who require a hearing aid do not have a hearing aid, and much of the country has low rates for dental visits or eye exams.

Mr. Golden said when speaking to voters he had heard repeatedly that the change would help the residents of his district.

“How crazy is it that we have been paying into Medicare all our professional lives, and at the time when your dental care is likely to be the most important, Medicare doesn’t even cover it?” he said. “I know seniors get frustrated with this.”

Nearly 20 Senators, led by Senator Bernie Sanders, the independent Vermonter, have joined forces on a similar call for White House action on the matter.

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Business

Biden Presses Financial Support Plan, Rejecting Inflation Fears

Biden Presses Economic Aid Plan, Rejecting Inflation Fears

With investors looking for some pickup in growth and slightly faster price hikes, Federal Reserve observers have expected it to slow down its large bond purchases that it has been using to support growth and raise interest rates earlier than expected.

The central bank has promised to keep interest rates near zero until the economy reaches full employment and inflation is above 2 percent and is expected to stay there for some time. If markets expect the economy to hit these goals sooner rather than later, it could be viewed as an expression of optimism.

“If you look at why they are rising, it has to do with expectations of a return to more normal levels, inflation in line with mandate, higher growth and an opening economy,” said Jerome H. Powell, chairman of the Fed. said of rates during a recent Congressional testimony.

The markets are forward-looking, however: the economy still has a long way to go before it can return to full strength. Administration officials have vowed not to be sidetracked by improvements in high-profile numbers like general employment growth and instead to continue the recovery until historically disadvantaged groups regain jobs, incomes and the benefits of other measures for economic progress.

Employment growth last month was above economists’ projections, but it would take more than two years for the labor market to return to employment levels in early 2020.

While economic pain remains across all populations, the effects have not been evenly distributed. Employment for black workers is still nearly 8 percent below pre-pandemic levels, while employment for white workers has declined by around 5 percent. Black workers tend to lose their jobs severely during recessions and only get them back after a long period of employment growth.

Ms. Jones, the Department of Labor economist, said the government was determined to accelerate the recovery of marginalized workers, noting that it took black workers in particular years longer to recover from the 2008 financial crisis – a delay that left permanent scars on these households.

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Politics

Congressional Committee Presses Cable Suppliers on Election Fraud Claims

Congressional Committee Presses Cable Providers on Election Fraud Claims

The legislature’s letter asked companies: “What steps have you taken before, on and after the November 3, 2020 elections and January 6, 2021 attacks to monitor the spread of disinformation, respond to it, and them? including encouraging or inciting violence through channels your business distributes to millions of Americans? “

“Are you planning to keep Fox News, OANN and Newsmax on your platform now and after the renewal date?” The letter goes on. “If yes why?”

Blair Levin, who served as the FCC’s chief of staff under President Bill Clinton, said a hearing could be a first step towards meaningful action. “You have to establish a state of affairs that in both the election and Covid, millions of Americans believe things that are just factually not true, and then try to figure out, ‘What is the appropriate role of government in changing these dynamics? ? ‘”Said Mr. Levin.

Harold Feld, senior vice president at Public Knowledge, a nonprofit group focused on telecommunications and digital rights, suggested that lawmakers may not have easy ways to influence Fox, Newsmax, or OAN.

“You have a lot of people who are very angry about it, you have a lot of people who want to show that they are very angry about it, but you still don’t have a lot of good ideas about what to do about it,” he said.

Currently, defamation lawsuits filed by private companies have taken the lead in the fight against disinformation, which is being broadcast on some cable channels.

Last month, Dominion Voting Systems, another voting technology company that played a prominent role in conspiracy theories about voting in 2020, sued two Trump legal representatives, Rudolph W. Giuliani and Sidney Powell, in separate lawsuits, each more than $ 1 billion claimed in damages. Both appeared as guests on Fox News, Fox Business, Newsmax and OAN in the weeks following the election.

On Monday, Dominion sued Mike Lindell, the managing director of MyPillow, on the grounds that he defamed Dominion with unsubstantiated allegations of voting fraud on its voting machines.

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Business

Hospital group presses Trump administration for ongoing federal assist with vaccine distribution

Hospital group presses Trump administration for ongoing federal help with vaccine distribution

Seniors 65 years and older wait in line at the Sarasota Department of Health’s COVID-19 Vaccination Clinic in Sarasota, Florida, the United States, Jan. 4, 2021.

Octavio Jones | Reuters

The American Hospital Association on Thursday urged Health Secretary Alex Azar to provide more support and coordination for the federal distribution of Covid-19 vaccines. The slow rollout has raised questions about how quickly they can vaccinate the public.

The group, which represents nearly 5,000 hospitals and health systems across the country, said the rollout “raised concerns about whether the task of vaccinating everyone who is able to take the vaccine will come as soon as it can it was suggested by the federal leaders “. According to a letter sent Thursday to Azar, the secretary of the Ministry of Health and Human Services.

According to the Centers for Disease Control and Prevention, more than 17.2 million doses of vaccine had been distributed as of Wednesday, but in fact just over 5.3 million doses had been given. This is nowhere near the targets previously set by federal officials to vaccinate 20 million people in December.

Richard Pollack, CEO of the AHA, said in the letter to Azar that the vaccine’s slow initial rollout casts doubt on whether the country will be able to vaccinate enough Americans to achieve herd immunity by the summer. In the first few weeks of the rollout, unforeseen issues arose, he added, calling on Azar to provide more leadership and coordination between states to address the issues.

Representatives from HHS have not returned CNBC’s request for comment.

According to Pollack, some hospitals have received fewer doses than requested, while others have received more than they need “with no explanation for this mismatch”. Pollack added that other differences between the state’s plans are also creating headaches for hospitals and adding to the complexity of the massive vaccination campaign.

“We hear from hospitals and health systems that serve more than one state that it is difficult to manage vaccine distribution when their patients live in jurisdictions with different rules about which patients are prioritized and who have different levels of priority,” wrote Pollack . “As this rollout is evolving rapidly, it is absolutely essential that effective situational real-time guidance is provided at the national level.”

He urged Azar and HHS to communicate more frequently and clearly with state, local, and hospital officials.

And many hospitals across the country are currently overwhelmed with treating Covid-19 patients. Pollack says hospitals cannot vaccinate the public without help. He said hospitals suffer from staff shortages and limited protective equipment such as masks and gloves. Pollack asked for more details about the government’s plan to include pharmacy chains in the wider vaccine rollout.

Pollack stressed that the aim of the vaccination campaign is to achieve herd immunity and bring the outbreak under control. By some estimates, that could be around 246 million Americans, or around 75% of the population.

“That would mean vaccinating 1.8 million people a day between January 15 and May 31, including weekends and holidays,” wrote Pollack of the attempt to vaccinate 246 million Americans by the summer. “There are currently 64 different micro-plans being developed by states, some major cities, and other jurisdictions [HHS] assess whether these plans are overall able to achieve this level of vaccination? “