When one strips away the partisan rhetoric and posturing, the practical impact of Friday’s GOP failure to repeal Obamacare has a specific monetary impact: approximately $1 trillion.
Since the ObamaCare repeal bill would have eliminated most of the 2010 health law’s taxes, this would have lowered by a similar amount the revenue baseline for tax reform. Essentially, with the ObamaCare taxes gone, it would have been easier to pay for lowering tax rates. Now, if Republicans want to eliminate the ObamaCare taxes as part of tax reform and ensure the bill does not add to the deficit – which they need to do to assure Trump’s reform process continues under Reconciliation, avoiding the need for 60 votes in the Senate – they will have to raise almost $1 trillion in revenue.
In other words that – all else equal – is how much less tax cuts Trumps and the republicans will be able to pursue unless of course they somehow find a source of $1 trillion in tax revenue (or otherwise simply add to the budget deficit) to offset the Obamacare overhang.
Considering Paul Ryan’s statement on Friday, it appears that at least for the time being, Republicans would leave the ObamaCare taxes in place. “That just means the ObamaCare taxes stay with ObamaCare,” he said. “We’re going to go fix the rest of the tax code.”
Ryan also pushed back on the idea that the setback on healthcare previews difficulties with other items on the legislative agenda “I don’t think this is prologue to other future things, because members realize there are other parts of our agenda that people have even more agreement on what to achieve,” he said. “We have even more agreement on the need and the nature of tax reform, on funding the government, on rebuilding the military, on securing the border.”
Update: echoing comments made by Senator Lindsey Graham, a South Carolina Republican who serves on the Senate Foreign Relations Committee, the top House Democrat said that the Trump budget proposal is “dead on arrival.“
Today at 7am, Trump released his “skinny budget”, his administration’s first federal budget blueprint revealing the President’s plan to dramatically reduce the size of the government. As previewed last night, the document calls for deep cuts at departments and agencies that would eliminate entire programs and slash the size of the federal workforce. It also proposes a $54 billion increase in defense spending, which the White House says will be offset by the other cuts.
“This is the ‘America First’ budget,” said White House budget director Mick Mulvaney, a former South Carolina congressman who made a name for himself as a spending hawk before Trump plucked him for his Cabinet, adding that “if he said it in the campaign, it’s in the budget.”
In a proposal with many losers, the Environmental Protection Agency and State Department stand out as targets for the biggest spending reductions. Funding would disappear altogether for 19 independent bodies that count on federal money for public broadcasting, the arts and regional issues from Alaska to Appalachia. Trump’s budget outline is a bare-bones plan covering just “discretionary” spending for the 2018 fiscal year starting on Oct. 1. It is the first volley in what is expected to be an intense battle over spending in coming months in Congress, which holds the federal purse strings and seldom approves presidents’ budget plans.
Trump wants to spend $54 billion more on defense, put a down payment on his border wall, and breathe life into a few other campaign promises. His initial budget outline does not incorporate his promise to pour $1 trillion into roads, bridges, airports and other infrastructure projects. The budget directs several agencies to shift resources toward fighting terrorism and cybercrime, enforcing sanctions, cracking down on illegal immigration and preventing government waste.
The White House has said the infrastructure plan is still to come.
According to the International Monetary Fund, global debt has grown to a staggering grand total of 152 trillion dollars. Other estimates put that figure closer to 200 trillion dollars, but for the purposes of this article let’s use the more conservative number. If you take 152 trillion dollars and divide it by the seven billion people living on the planet, you get $21,714, which would be the share of that debt for every man, woman and child in the world if it was divided up equally.
So if you have a family of four, your family’s share of the global debt load would be $86,856.
Update: shortly after the news hit that various publishing houses are caught in a bidding war over the Obamas’ upcoming memoirs, Penguin Random House issued a press release that it was the winner and will publish forthcoming books by former President Barack Obama and Michelle Obama, concluding a heated auction among multiple publishers.
The terms of the agreement were not disclosed. The Obamas were represented by Robert Barnett and Deneen Howell of Williams & Connolly.
“We are absolutely thrilled to continue our publishing partnership with President and Mrs. Obama. With their words and their leadership, they changed the world, and every day, with the books we publish at Penguin Random House, we strive to do the same,” the chief executive of Penguin Random House, Markus Dohle, said in a statement. “Now, we are very much looking forward to working together with President and Mrs. Obama to make each of their books global publishing events of unprecedented scope and significance.”
What took the Clintons years of confidential speeches before major investment banks and middle eastern clients of the Treasury Department, the Obama’s plan to achieve with just two books. According to the FT, several publishers are participating in a blockbuster auction for the global rights to two books by Barack and Michelle Obama where the bid has reached more than $60 million. The Obamas, who are writing separate books but selling the rights jointly, stand to make a record amount for their presidential memoirs.
The announcement comes amid reports that CNN, MSNBC and other organizations were thinking of boycotting the evening to protest their treatment at the hands of the new administration. This includes being called “a danger to our country” by the president and having their access to officials limited. Buzzfeed, the New York Times, the Los Angeles Times, the New York Daily News, the Hill and Politico were not invited to an off-camera but on-the-record press gaggle with White House Press Secretary Sean Spicer yesterday, a move CNN called “unacceptable.”
The annual dinner at the Washington Hilton, which raises money for journalism scholarships and awards, has turned into a celebrity event that some journalists have criticized as a sign the Washington press is becoming too cozy with the nation’s power structures.
Trump himself was brutally roasted when he attended as a guest in 2011 for pushing the Obama “birther” controversy.
The Trump-Putin honeymoon continues to chill… that is if Trump’s top foreign policy advisors speak for the president, which remains very much unclear.
As discussed yesterday, in the clearest sign yet that when it comes to diplomacy with Russia, there are two clear axes developing within the Trump administration: a Pence/Mattis/Haley foreign policy and a Trump/Bannon/Miller foreign policy, Vice President Mike Pence told the crowd at the Munich Security Conference that he would “hold Russia accountable” even as he vowed “unwavering support” for NATO. This prompted the following interesting scene moments later, as recounted by Bloomberg.
Shortly after Vice President Mike Pence pledged to “hold Russia to account” while looking for common ground in a speech to European allies, a hawkish Russian legislator reached out to shake his hand as he passed through a crowded hotel corridor.
“Mr. Vice President, I am from Moscow and we hope we will reach those arrangements you were talking about,” said Alexei Pushkov, a member of the defense committee in the upper chamber of the Russian parliament. He enthusiastically told reporters afterward that he saw the Vice President’s smile as a good sign.
U.S. President Donald Trump criticized on Saturday the action of a federal judge in Seattle blocking Trump’s executive order banning anyone from seven Muslim-majority nations from entering the United States, calling it “ridiculous” and vowing to overturn it.
Trump said on Twitter, “The opinion of this so-called judge, which essentially takes law-enforcement away from our country, is ridiculous and will be overturned.”
The bench order to lift the travel restriction was issued Friday. It suspends the executive order that Trump signed, banning travelers from the seven countries from entering the United States for 90 days, and refugees for 120 days, triggering a wave of protests across the United States.
Nearly 60,000 people had their U.S. visas cancelled due to the travel ban, the State Department said Friday.
The people will continue to be affected while the U.S. government reviews its screening process for admitting travelers from Syria, Yemen, Sudan, Somalia, Iraq, Iran and Libya and refugees from any country, the department said.
It took Obama ten days since he departed the White House one final time to break his promise that he would “stay on the sidelines” regarding Trump’s policies…
… and in his first public statement, the former president the charge that the Trump administration had based his immigration executive order on a policy adopted by his own administration, and endorsed the protests that have been taking place across the country in response to the new restrictions.
Kevin Lewis, Obama’s spokesman, said rejected Trump’s insistence that the decision to temporarily halt refugees from seven Muslim-majority countries and stop all Syrian refugee resettlement in America is similar to a 2011 decision by Obama. “With regard to comparisons to President Obama’s foreign policy decisions, as we’ve heard before, the President fundamentally disagrees with the notion of discriminating against individuals because of their faith or religion.”
As a reminder, over the past 24 hours, Trump has compared his actions to Obama’s 2011 moves to restrict entries from Iraq after two Iraqis were arrested in Kentucky on terrorism charges.
Former Obama administration officials have denied that there was ever a halt to the awarding of visas to Iraqis, though the processing of these applications slowed after they were subject to more intense scrutiny.
Obama’s decision to step back into the public light comes just 10 days after he left office. He joins the chorus of Democrats and mostly tech CEOs criticizing Trump for his decision to temporarily halt refugees from seven Muslim-majority countries and stop all Syrian refugee resettlement in America.
When it comes to Wall Street, Trump can launch martial law, suspend habeas corpus and/or use the Constitution for kindling and the market could care less as stocks will still go up. However, threaten some of Trump’s core economic stimulus projects like infrastructure spending (i.e., more public debt to fund corporate bottom lines) or tax reform (even more public debt flowing through to EPS), and suddenly stocks will pay very close attention.
It now appears that this particular “worst case” for stocks may be playing out. As we cautioned in our previous post looking at the impact of Trump tax reform on corporate earnings, the biggest risk for the controversial president is that “at this rate Trump may spend much of his first year dealing with immigration reform and Obamacare.”
However, as Paul Ryan warned last week during the Republicans’ outing in Philadelphia, Trump’s “#1 priority”, repealing and replacing Obamacare may not take place for several months. To wit:
House Speaker Paul Ryan told House and Senate Republicans that lawmakers likely won’t repeal and replace Obamacare until March or April. Speaking in the first major session of GOP lawmakers’ joint retreat in the City of Brotherly Love, Ryan said Wednesday that the health care law wouldn’t be repealed and subsequently replaced until spring.
“What we heard today was Obamacare is front and center,” Rep. Chris Collins, R-N.Y., told reporters, referring to the first session of the retreat, which outlined President Donald Trump’s first 200 days in office, or the “200 Day Plan.” “Repeal and replace,” Collins added. “The word was by the springtime.”
Update: The White House has just released a statement confirming this is similar to President Obama’s plan…
President Donald J. Trump Statement Regarding Recent Executive Order Concerning Extreme Vetting
“America is a proud nation of immigrants and we will continue to show compassion to those fleeing oppression, but we will do so while protecting our own citizens and border. America has always been the land of the free and home of the brave. We will keep it free and keep it safe, as the media knows, but refuses to say.
My policy is similar to what President Obama did in 2011 when he banned visas for refugees from Iraq for six months.
The seven countries named in the Executive Order are the same countries previously identified by the Obama administration as sources of terror.
To be clear, this is not a Muslim ban, as the media is falsely reporting. This is not about religion – this is about terror and keeping our country safe. There are over 40 different countries worldwide that are majority Muslim that are not affected by this order. We will again be issuing visas to all countries once we are sure we have reviewed and implemented the most secure policies over the next 90 days. I have tremendous feeling for the people involved in this horrific humanitarian crisis in Syria. My first priority will always be to protect and serve our country, but as President I will find ways to help all those who are suffering.”
As we detailed earlier, a president who chooses to ban immigrant refugees from majority-Muslim nations on the basis of national security and fears over terrorism is – according to the mainstream media and 1000s of Americans at various protests today – a vicious, soul-less, fascist, Islamophobic racist, and as bad as hitler (we are paraphrasing).