President Trump’s schedule (EST):
11:00 AM: Participates in the Missile Defense Review Announcement at The Pentagon; and
1:45 PM: Daily intelligence briefing.
The House will pass another continuing resolution to reopen the government, H.J.Res.28, shortly after noon today after it passes its Russia sanctions disapproval resolution, H.J.Res.30, to no effect because the Senate won’t take it up.
The Senate will hold a cloture vote at 4:30 PM today on a bill to prevent taxpayer funded abortions, S.109. That is unlikely to pass.
Russia sanctions disapproval resolution fell to a filibuster. At 12:32 PM yesterday, on a 57-42 vote, the Senate fell three votes short of ending debate on S.J.Res.2, Senate Minority Leader Chuck Schumer’s (D-NY) resolution to disapprove of President Trump’s attempt to lift sanctions on three Russian corporations, EN+, Rusal, and ESE, press release. So U.S. sanctions on those three firms will be lifted. More in yesterday’s Washington Post article.
“No Major Policy Changes in Long-Awaited Missile Defense Review.” Last night’s CQ Roll Call article in its entirety stated:
The Defense Department’s Missile Defense Review, more than a year overdue, will stop short of calling for deploying defensive weapons in space when President Donald Trump officially releases the planning document Thursday at the Pentagon.
In a background call with reporters, senior administration officials said the review advocates for further study of space-based defenses, such as interceptor missiles or lasers, that could stop an incoming missile attack. But the review does not specifically prescribe the development and deployment of such weapons, the officials said.
The review does not appear to include any major policy changes. Nonproliferation supporters feared it would include a change in posture towards Russia and China, the countries that the Pentagon’s National Defense Strategy identified as great powers competing with the United States for global influence.
But the United States will continue to rely on its nuclear arsenal to act as a deterrent for those countries, rather than embarking on a hugely expensive — and unachievable, opponents argue — effort to develop a new defensive weapon that could shoot down every incoming warhead.
The United States currently has 44 ground-based missile interceptors based in California and Alaska to counter a possible strike from North Korea, with funding approved for an additional 20 interceptors. The Missile Defense Review contemplates a third site for those defenses, possibly on the East Coast to counter a strike from Iran, the official said.
The Pentagon has conducted environmental studies on three possible sites, but a final decision on whether to develop a third site has not been made, according to the official.
James Mattis, who resigned Jan. 1 as Defense secretary, initiated the Missile Defense Review in May 2017, with a target of completion by the end of that calendar year. Publication was delayed, without an official explanation from the Pentagon, throughout 2018.
House Financial Services Committee Chair Maxine Waters (D-CA) outlined her agenda. In her first speech as chair yesterday, she expressed dismay over the government shutdown, sharply criticized Mick Mulvaney’s dismantling of the Consumer Financial Protection Bureau, and said:
An ongoing priority for me is ensuring that we have a strong Consumer Financial Protection Bureau and strong financial regulation that protects consumers, investors and our economy. …
One emerging area the Financial Services Committee will be paying very close attention to is the growth of financial technology, or so-called “fintech” firms. …
Credit reporting is another issue I will be scrutinizing. In the wake of the Equifax data breach, it’s absolutely critical for Congress to reform the nation’s credit reporting system. We need to shift the burden of removing mistakes from credit reports onto the credit bureaus and furnishers, and away from consumers. We also need to place limits on credit checks for employment purposes, reduce the time period that negative items stay on credit reports, and make other reforms to fix the serious problems with the credit reporting sector. …
So I will soon be reintroducing my bill, the Ending Homelessness Act, which would help to ensure that every American has a safe, decent, and affordable place to call home. The bill provides $13.27 billion in new funding over five years to federal programs and initiatives to prevent homelessness. …
To that end, in addition to conducting robust oversight of the Trump Administration’s activities at HUD, I will be reintroducing the Restoring Fair Housing Protections Act, my bill to reverse the harmful steps taken by Secretary Carson and the Trump Administration to undermine fair housing. I promise to continue to stand up for fair housing opportunities for all people. …
I look forward to working with my colleagues in both chambers and across the aisle to closely monitor all further developments on Russia sanctions, to hold the Administration accountable for its actions in this area, and to ensure that the strongest possible sanctions against Russia are implemented and remain in place.
Chair Waters will only be able to enact legislation that the Senate will pass and President Trump will sign, but she can hold hearings and wield her subpoena power to great effect.
“Fed Says Student Debt Has Hurt the U.S. Housing Market.” Last night’s Wall Street Journal article led with:
The Federal Reserve has linked rising student debt to a drop in homeownership among young Americans and the flight of college graduates from rural areas, two big shifts that have helped reshape the U.S. economy.
The effect of student debt on the economy has been debated in recent years, as the total has soared to $1.5 trillion, surpassing Americans’ credit-card and car-loan bills. Congress and various White House administrations have pointed to federal student loans as a key way for Americans to pay for college and boost their career earnings. Critics have said the debt is damaging the economic prospects of a generation of Americans.
The Fed research published Wednesday didn’t offer a verdict on those assertions. But it showed that student debt is linked to key life decisions for some—including whether to buy a home and where to live.
Homeownership among people ages 24 to 32 fell 9 percentage points, to 36% from 45%, between 2005 and 2014, the Fed said. While many factors affected the homeowner rate, the Fed said 2 percentage points, or about a fifth, of the decline was tied directly to student debt. That translated into 400,000 borrowers who could have owned a home by 2014 but didn’t because of student loans.
“Trump’s Tariffs Are Producing Billions, But China Isn’t Paying.” This morning’s Bloomberg News article led with:
President Donald Trump is right to say that his tariffs are generating billions of dollars for the U.S. But China and other countries aren’t paying them as he’s suggested.
According to data from U.S. Customs and Border Protection, more than $13 billion in duties imposed by the Trump administration were assessed on imported goods as of Dec. 18. Actual collections could lag and be lower because of refunds and other factors, but Treasury Department reports show receipts from all customs duties have risen sharply since the tariffs took effect.
While Trump has suggested on Twitter and in public comments that tariffs are somehow being charged to or paid by China and other countries, trade economists say that’s generally misleading. U.S. importers of record are responsible for the duties, and ultimately U.S. businesses and consumers could pay through higher costs, they say.
“Grassley Sees Shutdown Delaying Major Trade Talks.” Last night’s Wall Street Journal article led with:
WASHINGTON—The chairman of the Senate Finance Committee said Wednesday that the Trump administration’s trade negotiations may be delayed as a result of the partial government shutdown, which is now on day 26.
The estimated start dates for two major trade negotiations appear to be in jeopardy amid significant reductions in staff at the U.S. trade representative’s office, the White House and other key offices, Republican Sen. Chuck Grassley of Iowa said.
“I think they’re going to be delayed,” he said, referring specifically to talks expected to start with the European Union and Japan.
Congressional consideration of President Trump’s revised trade deal with Mexico and Canada may also be delayed because the International Trade Commission, the office charged with producing an economic report on the deal, has been closed since the start of the shutdown. Congress won’t move forward without that report, Mr. Grassley said.
A senior White House official dismissed Mr. Grassley’s prediction and said there are enough staffers working to proceed with the pending trade talks.
Grassley hopes to pass tax extenders, but said it’s too late for 2018 returns. Yesterday, Senate Finance Committee Chair Chuck Grassley (R-IA) told reporters:
It’s not too late to pass extenders. It’s too late to do something that would affect the 2018 filing season.
All I can tell you is, it’s my goal to get extenders done. When you can get it done and under what conditions I can’t tell you now because I don’t have a plan or a vehicle to get it done.
If a tax extenders bill is enacted later this year, taxpayers would have to file amended returns to take advantage of them. Last year’s tax extender bill, H.R.88, died with the end of the 115th Congress. Tax Cuts and Jobs Act technical corrections (net operating loss effective date, qualified investment property, and charitable deduction limit) remain to be enacted as well.
“IRS waives penalty for many whose tax withholding and estimated tax payments fell short in 2018.” Yesterday afternoon’s Internal Revenue Service press release led with:
WASHINGTON — The Internal Revenue Service announced today that it is waiving the estimated tax penalty for many taxpayers whose 2018 federal income tax withholding and estimated tax payments fell short of their total tax liability for the year.
The IRS is generally waiving the penalty for any taxpayer who paid at least 85 percent of their total tax liability during the year through federal income tax withholding, quarterly estimated tax payments or a combination of the two. The usual percentage threshold is 90 percent to avoid a penalty.
The waiver computation announced today will be integrated into commercially-available tax software and reflected in the forthcoming revision of Form 2210 and instructions.
This relief is designed to help taxpayers who were unable to properly adjust their withholding and estimated tax payments to reflect an array of changes under the Tax Cuts and Jobs Act (TCJA), the far-reaching tax reform law enacted in December 2017.
The Wall Street Journal noted:
For tax year 2016, the IRS collected more than $1.5 billion in estimated-tax penalties from more than nine million households, and that was just from taxpayers who calculated the penalties themselves and listed them on their returns. Those figures don’t include penalties calculated by the IRS after a taxpayer files a return.
“Remember The Export-Import Bank?” Check out American Action Forum President Doug Holtz-Eakin’s morning blog, which concluded:
… the Ex-Im Bank is a necessary evil to level the playing field. … Ex-Im should have a limited and carefully targeted role. But it is premature and counterproductive for it to have no role whatsoever.
