Happy Thursday and welcome back to On The Money, where we love a little bit of storm-related irony so long as no one gets hurt. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.
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THE BIG DEAL– Senate passes disaster aid bill after deal with Trump: The Senate easily cleared a long-stalled disaster aid package after Republicans reached a deal with President TrumpDonald John TrumpFeinstein, Iranian foreign minister had dinner amid tensions: report The Hill’s Morning Report – Trump says no legislation until Dems end probes Harris readies a Phase 2 as she seeks to rejuvenate campaign MORE to drop border-related provisions from the bill.
Senators voted 85-8 on the legislation, which provides $19.1 billion in recovery money for a recent slate of wildfires, hurricanes and storms. GOP Sens. Marsha BlackburnMarsha BlackburnHillicon Valley: Google delays cutting off Huawei | GOP senators split over breaking up big tech | Report finds DNC lagging behind RNC on cybersecurity GOP senators split over antitrust remedies for big tech Graham warns of 5G security threat from China MORE (Tenn.), Mike BraunMichael BraunPence, McConnell eulogize Sen. Richard Lugar GOP senators propose congressional term limits Bipartisan senators introduce bill to fix problem of teacher debt MORE (Ind.), Mike CrapoMichael (Mike) Dean CrapoTrump, Senate GOP discuss effort to overhaul legal immigration Dems propose fining credit agencies for data breaches Mueller fails to break stalemate on election meddling crackdown MORE (Idaho), Mike LeeMichael (Mike) Shumway LeeHillicon Valley: Google delays cutting off Huawei | GOP senators split over breaking up big tech | Report finds DNC lagging behind RNC on cybersecurity GOP senators split over antitrust remedies for big tech Fix the climate with smaller families MORE (Utah), Martha McSallyMartha Elizabeth McSallyOvernight Defense: Trump officials say efforts to deter Iran are working | Trump taps new Air Force secretary | House panel passes defense bill that limits border wall funds Trump taps new Air Force secretary Bolton emerges as flashpoint in GOP debate on Iran MORE (Ariz.), Rand PaulRandal (Rand) Howard PaulRand Paul splits with Amash on Trump impeachment The Go-Go’s rock the stage at annual ‘We Write the Songs’ DC concert GOP presses Trump to make a deal on spending MORE (Ky.), Jim RischJames (Jim) Elroy RischOvernight Defense: Iran worries dominate foreign policy talk | Pentagon reportedly to send WH plans for 10K troops in Mideast | Democrats warn Trump may push through Saudi arms sale | Lawmakers blast new Pentagon policy on sharing info Democrats warn Trump may soon push through Saudi arms sale Trump, Europe increasingly at odds on Iran MORE (Idaho) and Mitt RomneyWillard (Mitt) Mitt RomneyIraq War looms over Trump battle with Iran Alabama state senator introduces bill to repeal state’s abortion ban Overnight Health Care — Presented by PCMA — McConnell, Kaine offer bill to raise tobacco buying age to 21 | Measles outbreak spreads to 24 states | Pro-ObamaCare group launches ad blitz to protect Dems MORE (Utah) voted against the bill.
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The House has already left for the weeklong Memorial Day recess. But a Democratic leadership aide said the caucus supports the measure and hopes to clear it by unanimous consent on Friday. The Hill’s Jordain Carney tells us how we got here.
- The Senate’s vote came hours after GOP Sens. Richard ShelbyRichard Craig ShelbyThe Hill’s Morning Report – Trump says no legislation until Dems end probes Chances for disaster aid deal slip amid immigration fight Immigration fight imperils deal on disaster aid package MORE (Ala.) and David Perdue (Ga.) talked on the phone with Trump, a conversation in which, according to GOP lawmakers, he told them he would support the bill without the immigration-related language that was a major sticking point to an agreement.
- “We’ve proposed … that we come forth with a clean disaster package, a lot of things off including border security stuff, just disaster, basically. And the president said OK,” Shelby told reporters.
- The deal, according to a GOP appropriations aide, includes a total of $19.1 billion for disaster recovery.
Breaking down the bill:
- In a win for Democrats, it also includes $600 million in food stamp money for Puerto Rico and an additional $300 million in Housing and Urban Development (HUD) grants for the commonwealth.
- The Senate’s original disaster bill, which included only the food stamp funding, derailed after Trump criticized Puerto Rico’s handling of recovery money during a closed-door GOP lunch. Lawmakers acknowledged earlier this week that they had finalized that portion of the package.
- It also includes a top priority for Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellThe Hill’s Morning Report – Trump says no legislation until Dems end probes Threat of impeachment takes oxygen out of 2019 agenda Chances for disaster aid deal slip amid immigration fight MORE (R-Ky.): a provision making hemp eligible for federal crop insurance.
LEADING THE DAY
Trump administration announces $16B aid package for farmers hurt by trade war with China: The assistance will provide direct payments to help farmers make up for losses resulting from retaliatory tariffs Beijing imposed on major U.S. crops. Limited access to China’s market has helped drive down the price of agricultural commodities since the collapse of trade talks earlier this month.
- Beijing increased tariffs on $60 billion in U.S. goods in response to Trump’s decision to raise tariffs on $250 billion in Chinese imports to 25 percent.
- The program is similar to a $12 billion aid package Trump approved last year amid heightened trade tensions with China.
- It is expected to last through the rest of the year, with the first batch of payments sent out in late July or early August. The president had previously said tariff revenue would help fund the aid package but the program as described by the Agriculture Department is not expected to directly use money collected from tariffs.
“President Trump has great affection for America’s farmers and ranchers, and he knows they are bearing the brunt of these trade disputes,” Agriculture Secretary Sonny PerdueGeorge (Sonny) Ervin PerdueUSDA relocates expert economists, researchers who challenge Trump policies: report Gov. Kemp vetoed school recess bill in Georgia — it’s irresponsible and neglects children’s needs On The Money: Judge upholds House subpoena for Trump financial records | Trump vows to appeal ruling by ‘Obama-appointed judge’ | Canada, Mexico lift retaliatory tariffs on US | IRS audit rate falls MORE said in a statement. “In fact, I’ve never known of a president that has been more concerned or interested in farmer wellbeing and long-term profitability than President Trump.”
New Trump tariffs double costs to consumers, lower tax revenue, study shows:
President Trump’s latest tariff increases on Chinese imports brought the annual cost of import taxes to $831 per household, according to a study on the New York Federal Reserve’s blog.
The study by Mary Amiti, Stephen J. Redding, and David E. Weinstein found Trump’s decision to increase tariffs on $200 billion of Chinese imports from 10 percent to 25 percent doubles the cost to American households compared to all his previous tariffs.
The increased cost to consumers amounts to $106 billion a year.
But the higher tariffs could actually lead to a drop in revenue for the Treasury Department, because the price increase is large enough to push consumers to buy alternative offerings from countries such as Vietnam.
“According to our estimates, these higher tariffs are likely to create large economic distortions and reduce U.S. tariff revenues,” the authors concluded. The Hill’s Niv Elis breaks down the study here.
House votes to boost retirement savings: The House on Thursday passed a bipartisan bill aimed at boosting retirement savings that also fixes an issue with the GOP tax law.
The bill, known as the SECURE Act, passed by a vote of 417-3. The three lawmakers who voted against the bill were GOP Reps. Justin AmashJustin AmashThe Hill’s Morning Report – Trump says no legislation until Dems end probes Amash says some Republicans privately sympathize with Trump impeachment comments Rand Paul splits with Amash on Trump impeachment MORE (Mich.), Thomas MassieThomas Harold MassieThe Hill’s Morning Report – White House, Congress: Urgency of now around budget GOP lawmaker doubles down on criticizing Kerry’s political science degree as not ‘science’ John Kerry fires back at GOP congressman questioning his ‘pseudoscience’ degree MORE (Ky.) and Chip RoyCharles (Chip) Eugene RoyLet Texas be Texas: A solution for our polarized nation Republicans defend drug company in spotlight over HIV medication prices House committee approves 9.8b health, education bill MORE (Texas).
The bill includes a number of provisions designed to encourage businesses to offer retirement plans and to make it easier for people to save for their retirements.
These include provisions that would make it easier for small businesses to join together to offer retirement plans, treat graduate students’ stipends as compensation for purposes concerning individual retirement accounts (IRA), allow long-term and part-time workers to participate in companies’ 401(k) plans, and eliminate the age maximum for contributing to IRAs.
The bill also would reverse changes that the GOP tax law made to a tax on children’s unearned income known as the “kiddie tax.” The changes unintentionally raised taxes on certain income received by children, such as benefits received by the children of deceased military members and first responders.
The Hill’s Naomi Jagoda has more on the bill and what’s next in the Senate.
Drink up: The trade war is also bad news for the brews: A study by the Beer Institute and National Beer Wholesalers Association found that direct, indirect and induced jobs dropped to 2.19 million in 2018 from 2.23 million in 2016, according to Bloomberg News, and insiders say Trump’s steel and aluminum tariffs are the cause.
GOOD TO KNOW:
- Senate Finance Committee ranking member Ron WydenRonald (Ron) Lee WydenDemocrats seize on IRS memo in Trump tax battle Momentum grows to create ‘Do Not Track’ registry Senate chairman says bipartisan health care package coming Thursday MORE (D-Ore.) on Thursday introduced a bill that would end tax benefits for investment fund managers’ carried interest after President Trump reiterated his desire to do so.
- Two House Appropriations subcommittees on Thursday passed spending bills that defy President Trump’s requests to slash spending on agriculture, transportation and housing.
- A bipartisan select committee is sending Congress a proposal on how to modernize the lobbying disclosure system.
- Sen. Elizabeth WarrenElizabeth Ann WarrenThe Hill’s Morning Report – Trump says no legislation until Dems end probes Harris readies a Phase 2 as she seeks to rejuvenate campaign 2020 Dems put spotlight on disabilities issues MORE (D-Mass.) and Rep. Alexandria Ocasio-CortezAlexandria Ocasio-CortezOcasio-Cortez makes endorsement for Queens district attorney Lawmakers call for ‘time out’ on facial recognition tech Markey releases infrastructure suggestions that align with Green New Deal goals MORE (D-N.Y.) on Thursday pressed Treasury Secretary Steven MnuchinSteven Terner MnuchinThe Hill’s Morning Report – Trump says no legislation until Dems end probes Democrats seize on IRS memo in Trump tax battle No agreement on budget caps in sight ahead of Memorial Day recess MORE on allegations that he and other Sears board members stole billions of dollars from the collapsing retailer.
- The Dow Jones Industrial Average plunged 375 points, or 1.4 percent, in the opening hour of trading Thursday morning, amid fears that President Trump’s trade war with China is escalating. It closed down 286 points.
- JPMorgan Chase, the largest bank in the United States by assets, will reportedly no longer offer its services to OxyContin producer Purdue Pharma over the company’s alleged role in the country’s opioid crisis.
ODDS AND ENDS
- Rep. Eric SwalwellEric Michael SwalwellCNN’s O’Rourke town hall finishes behind Fox News, MSNBC Biden retains large lead over Sanders, other 2020 Dems in new Hill-HarrisX poll Hickenlooper: Gun owners should be licensed, pass safety test MORE (D-Calif.) on Thursday became the second 2020 White House candidate to begin accepting cryptocurrency donations.
- A top Huawei official said Thursday that the company will have its own operating system ready to replace Google and Microsoft smartphone and laptop software if permanently blocked from licensing the American products.