Here’s for what you need to know before your iced coffee gets warm, the July 26, 2017 edition of the tipsheet.
What DC’s Talking About: Skinny Summer
The President (and Senate Majority Leader Mitch McConnell got a big PR win yesterday as the Senate cleared a procedural hurdle and proceeded to debate on a bill that would repeal and replace the Affordable Care Act (Obamacare).
The vote was dramatic, complete with protesters, Vice President Mike Pence, and a hero’s welcome for Senator John McCain. The vote was 51-50.
The Senate, officially, took up debate of the repeal and replace bill that was sent to them by the House of Representatives. However, given cuts to Medicaid and other reforms in the House bill, it was never going to pass in the Senate. Rather, the Senate is set to hold a “Vote-o-rama” in the coming hours on amendments and proposals to change the bill.
The most likely outcome: The first votes that were taken were on the original Senate plan (BCRA) and on a full repeal (organized to get the likes of Senator Rand Paul to vote for the Motion to Proceed). Both failed. However, given the whip counts, we knew those would fail. The “real” vote is going to be on what’s being dubbed “The Skinny Bill” or “Skinny Repeal” (no, it’s not the newest coffee fad in DC).
Skinny Repeal will get rid of the individual mandate, the employer mandate, and the medical device tax. All of these have been common GOP points for the last seven years and, at least at the outset, it looks like the caucus is united enough to get it passed.
After getting Skinny, the bill will proceed to conference with House leadership and the two sides will hammer out some compromise legislation that is set to look more like the Senate plan than the one that was passed in the House. After that, though the House will have a significantly less-powerful repeal and replace bill, the pressure to pass the final legislation will likely overwhelm resistance. Certainly, though, it is a step in the right direction and will get rid of some of the most-glaring flaws of Obamacare. It remains to be seen exactly what the final bill will look like.
The one big lesson: Never count out Mitch McConnell. The effort to get a bill through the Senate was declared dead a week ago, but McConnell was able to get enough of his Senators to yes. Along with his savvy on the Supreme Court nomination, let’s remember, despite sometimes looking like things are moving at a glacial pace, when it comes right down to it, don’t count out Mitch.
In the Rest of America: Trump Dazzles Democrat Stronghold
The President was in Youngstown, Ohio last night for a major rally. Local news reports that 20,000 people tried to get tickets to an event that had a maximum capacity of 7,000. Youngstown, long a stronghold for blue collar, working-class, Democrats turned out in droves to support President Trump.
Despite the media narratives about sagging popularity, the President is still able to galvanize his base and deliver the populist, outsider message that so many working Americans need to hear.
Contrast the President’s ability to reach average folks with the Democrats’ “A Better Deal” slogan that only promises income redistribution and more identity politics and it’s clear that the President’s message is still carrying the day.
President Trump also knows that there are eleven vulnerable Democrats in the Senate in states that he carried last year (including Ohio). His message is geared at laying the foundation for picking up additional seats in the Senate, contrary to the DC-New York theory that Presidents lose seats in their midterm elections.
The Sessions standoff continues. The President didn’t back off his criticism of Attorney General Jeff Sessions yesterday when the President was taking questions from reporters in a press conference with the Prime Minister of Lebanon. At the moment, both Sessions and the President look to be at an impasse without either side willing to take the next step towards Sessions’ leaving his post. Rumor is that Sessions may attempt to thaw the relationship by announcing a new investigation into leaks from the DOJ, a sore spot with Mr. Trump.
For the first time since President Trump took office, a United States Navy vessel was forced to fire warning shots at an Iranian vessel. The Iranians had sailed dangerously close the the American patrol. This comes as the President has been critical of the Iranian nuclear deal and the amounts of money and credit it transferred to Tehran.
Russian sanctions are flying through Congress and set to wind up on the President’s desk soon. With only a handful of lawmakers in both the House and Senate opposing stricter controls on Moscow, it looks like the President’s hand is going to be forced on the issue. This latest round has received pushback from the State Department that sees stricter sanctions as curtailing diplomatic options with regard to conflict resolution.
Newly declassified memos from the Obama Era detail significant improper spying on Americans by the NSA. Th ACLU, which obtained the documents through the Freedom of Information Act, shows large-scale, indiscriminate surveillance by the Federal Government done in secret.
The Baltimore City Council, unwilling to actively confront the spiking homicide rate in the City, decided to water down an already light mandatory one year sentencing bill for people carrying illegal guns. The far-left on the Council and activists had screamed and protested until the Council gave in and watered-down the measure in committee.
Attorney General Sessions is taking a stand against “Sanctuary” cities that are providing safe haven for illegal aliens. The Department of Justice is actively pursuing a policy of stripping funding from areas that decide not to comply with Federal immigration law.
All business eyes are on the Fed meeting today where some degree of balance sheet normalization is expected. While this meeting is not predicted to be as robust as the one set for September, the markets are set to react to moves by the Fed later today.