“Shutdown Pinches Economic Growth.” Last night’s Wall Street Journal article led with:
A Vermont mead brewery has delayed a major expansion because the owners can’t get a business loan. A craft-burger joint in Utah has sent employees home because sales are down. And a Maryland Lyft driver has seen his weekly income fall by nearly half.
The partial federal government shutdown that became the longest on record Sunday is curtailing infrastructure projects, food-processing inspections and economic data used by Wall Street. But on a more micro level, it is showing signs of disrupting commerce as hundreds of thousands of federal workers missed out on their first payday of the closure late last week.
While the economic gashes aren’t enough to derail the recovery, now in its 10th year, they appear to be at least temporarily diminishing the vigor of an expansion that was already projected to slow in 2019. Output is now expected to grow at a 2.2% pace in the first quarter, less than an estimated 3.1% growth recorded in 2018, economists surveyed by The Wall Street Journal projected earlier this month. Those first-quarter estimates—down slightly from prior ones before the shutdown—will likely slip further as the shutdown continues. It enters its 24th day Monday.
There were no talks over the weekend, and none have been set yet for this week.
President Trump’s schedule (EST):
9:00 AM: Departs the White House;
11:55 AM: Arrives in Kenner, LA;
12:40 PM: Speaks to the American Farm Bureau Federation’s 100th Annual Convention in New Orleans, LA, live on C-SPAN2;
1:55 PM: Departs Kenner, LA;
4:25 PM: Arrives back at the White House; and
6:30 PM: Welcomes the 2018 College Football Playoff National Champion Clemson Tigers to the White House.
Federal government offices in D.C. are closed today because of snow. Congress is still expected to meet, and furloughed federal workers were staying home anyway.
The House will convene a 2 PM today with votes postponed until 6:30 PM on five bills from the Suspension Calendar, including the TANF Extension Act, H.R.430, and four bills from the Small Business Committee. The Senate will convene at 3 PM, and, at 5:30 PM, will vote again on whether to invoke cloture on the Strengthening America’s Security in the Middle East Act, S.1, which Democrats are holding up until President Trump agrees to reopen the government.
William Barr nomination to be Attorney General hearings 9:30 AM Tuesday and Wednesday, Senate Judiciary Committee.
Fighting Elder Fraud hearing 9:30 AM Wednesday, Senate Aging Committee.
Andrew Wheeler to be EPA Administrator hearing 10 AM Wednesday, Senate Environment and Public Works Committee.
Advanced Nuclear Reactors hearing 2:30 PM Wednesday, Appropriations Energy and Water Development Subcommittee.
“CBO to Delay Release of Sequestration Report.” Friday, the Congressional Budget Office reported:
In general, after a session of Congress ends, the Congressional Budget Office is required to issue a report that provides estimates of the limits (or “caps”) on discretionary budget authority and that states whether enacted legislation for the current fiscal year has exceeded those caps. However, for this year’s report to be complete and as useful to the Congress as possible, the House and Senate Budget Committees have asked CBO to delay publishing the report until it can fully account for the funding provided in all 12 annual appropriation bills.
Raising the budget caps will be a very contentious fight this spring between the House and the Senate. We’ll see if Congress can pass a budget resolution conference report this year. It failed to do so last year. Without a budget resolution, Congress usually resorts to a “deeming resolution” to allow the appropriations process to proceed as described in this 18-page October 29, 2018 Congressional Research Service report.
“Regulation And Drug Prices.” This morning’s blog by American Action Forum President Doug Holtz-Eakin leads with:
Nearly everyone expects Congress to do “something on drug prices” this year, although exactly what is far from clear. Recall, however, that the administration has already launched a broad initiative (its “Blueprint”) to address the drug pricing issue. A signature — and contentious — element of this is its proposed demonstration project on reimbursements in Part B. Perhaps lost in the end-of-year, government shutdown, New Year, New Congress noise is the fact that comments on this proposal were due to the Department of Health and Human Services (HHS) by December 31, 2018. AAF’s Tara O’Neill Hayes responded to the request with this thoughtful submission [, which concluded, “The Trump Administration has properly identified a significant problem with the international pricing of pharmaceuticals. The proposed solution, however, is misguided and likely to backfire.”].
Infrastructure: “more revenues from dedicated user fees” backed by the U.S. Chamber. Last Thursday’s statement about what Congress could get done this year by U.S. Chamber of Commerce President Tom Donahue included:
First, infrastructure. Members on both sides of the aisle have long agreed on the need to modernize the physical platform of our economy. They’ll have to make some trade-offs, but there is a real chance to finally do it. Republicans are going to have to accept that we need more revenue from dedicated user fees. Democrats are going to have to accept that private investment must be a big part of the solution. Both sides should look at this as an investment in our nation’s long-term competitiveness and future prosperity.
“TPC’s Sports Gambling Tip Sheet.” Thursday’s Tax Policy Center analysis by Richard Auxier of states’ taxes on sports gambling led with:
I don’t have an official over-under for the number of states that will legalize sports gambling in 2019, but I know it’s high. Since the Supreme Court opened the door to legal and taxable sports betting last May, six states have joined Nevada (legal since the 1940s) as homes to legal sports books. The District of Columbia approved sports betting in December and will take bets in the spring. Nearly every other state will at least discuss the issue during this year’s legislative session.
But raising large amounts of tax revenue from sports gambling is no sure bet. Here’s what policymakers should know before placing wagers.