GOP Congress Gives Trump Its Middle Finger

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No, it’s not oversight hearings into…well…anything.

And it’s certainly not a subpoena, legislation to protect the Mueller investigation or the rejection of his Supreme Court nominee.

But the GOP congressional leadership’s decision last week not to give Donald Trump the $5 billion he wants for a wall between the United States and Mexico before the election and then to make it much harder for him to veto the legislation that codifies that decision was the closest House and Senate Republicans have come since Trump was elected to publicly giving him their collective middle finger.

First, Congress decided to combine several of the fiscal 2019 appropriations together both to deal with the very limited amount of time left before the government shuts down on October 1 and to make it more likely that the wide swath of programs funded in these small omnibus appropriations (hence the name “minibus”) would attract enough votes to pass the House and Senate.

This was an act of desperation and defiance by the Republican leadership.

Second, the GOP leadership then decided to attach the continuing resolution — the bill that will be needed to keep open the agencies and departments not included in either of the two minibuses — to the combined Defense-Health and Human Services appropriation. Given that the White House staff (but not Trump himself) has indicated that the president will sign that bill, the thinking was that this will reduce or even eliminate the chances of government shutdown before the election.

This was an act of desperation and defiance by the Republican congressional leadership. Knowing that they weren’t going to approve the billions of dollars Trump has been insisting on for his wall and that they would face his wrath when they didn’t, the GOP Congress made it significantly more painful for the president to react negatively when he didn’t get what he was demanding.

This has been coming for months given that the congressional Republicans’ political needs differ so sharply from Trump’s heading into the mid-term elections.

With polls showing the Republican control of the House and Senate increasingly at risk, a government shutdown is the last thing the GOP leadership wants five weeks before Election Day and just as early voting gets underway in many states.

Trump, on the other hand, may see a shutdown over his wall as the best way to raise the reddest of red meat issues — immigration — with his base.

And Trump’s need to energize his base took on increased importance last week with Paul Manafort’s plea deal, the release of Bob Woodward’s book and the continuing aftermath of the New York Times anonymous op-ed.

So far, Trump has been anything but consistent about a shutdown.

Trump may see a government shutdown as the most dramatic thing available to him right now to divert attention. Other very dramatic diversions, such as firing Attorney General Jeff Sessions, all seem unlikely before the election.

He may also see it as part of his continuing anti-impeachment strategy to energize the voters he will need to keep Congress from moving forward.

What’s most interesting and potentially most politically significant about this are that the Republicans in Congress (1) decided to devise an appropriations strategy that unambiguously helps themselves rather than Trump, (2) didn’t accommodate the White House in even some small way and (3) challenged Trump so openly.

In addition, the congressional leadership did this not knowing whether it would work. As I noted in this post, So far, Trump has been anything but consistent about a shutdown and there’s no way to guarantee he will be more rational between now and October 1 than he has been so far.

Indeed, given Manafort et al., it may be safer to assume that he won’t be.

In other words, Trump could easily decide to reply to the congressional GOP’s middle finger by giving it right back to them.

Follow Stan Collender on Twitter @thebudgetguy.

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Trump’s Deficit Chickens Now Coming Home To Roost

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The first of two official government reports that will be released this month showing that the federal budget deficit is soaring was issued on Monday when the Congressional Budget Office published it’s Monthly Budget Review for August.

According to CBO, the deficit through the first 11 months of fiscal 2018 was $895 billion, a $222 billion (32.8 percent) increase over the same period in 2017.

Some of the increase was the result of timing shifts, that is, spending that was made at the end of August because the first two days of September were on weekend. The deficit for the 11-month period would have been only $154 billion larger than 2017 had it not been for that.

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 The federal government typically runs a budget surplus in September so the final deficit for 2018 may be somewhat lower than the results through August. CBO said that the total deficit for the year will be close to the $793 billion estimate it made in its analysis of the Trump 2019 budget that it updated last month. That would make the year-over-year increase only 19.3 percent.

But put the number crunching wonkery aside and look at the big picture. Donald Trump, who as a candidate virtually guaranteed he would eliminate not just the budget deficit but the national debt, is doing neither.

It’s anything but fake news to say that just the opposite is true. Trump’s own Office of Management and Budget, whose primary responsibility is to protect the president’s behind on budget issues, agrees with CBO that the deficit will come close to or exceed $1 trillion a year through at least 2022.

Keep in mind that this doesn’t include spending for a space force, an infrastructure plan or a wall between the United States and Mexico. It also doesn’t include the projected $200 billion a year revenue loss from the new GOP tax bill the House will debate before the election or the additional spending that will be needed because of Hurricane Florence. And it certainly doesn’t include the lower revenues and higher spending that will happen if the economy slows below current expectations.

A combination of these things could easily cause the U.S. deficit to approach $2 trillion annually.

The next Trump deficit shoe to drop will occur next week when Trump’s own Treasury issues its own monthly report that is expected to agree with and confirm what CBO said this week.

Follow Stan Collender on Twitter @thebudgetguy

 

 

 

 

 

Trump Has Become Hamlet. To Shut Down Or Not To Shutdown: That Is The Question

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The question of whether President Donald Trump will shut down the federal government has now become the budget equivalent of a scene from Shakespeare’s “Hamlet,” with Trump endlessly reciting his own version of the “To be or not to be” soliloquy.

As a result, with just 7 legislative days to go before the end of the fiscal year, and even though congressional Republican leaders are trying hard to prevent it from happening, there’s still little-to-no certainty about whether Trump will cause the government to shut its doors if he doesn’t get the billions of dollars he wants to build a wall between the United States and Mexico.

Trump has become less rather than more predictable over the past few weeks as the shutdown deadline has gotten closer and as he’s become preoccupied with Mueller, Cohen, Manafort, Sessions, Papadopoulos, the Woodward book, the anonymous New York Times op-ed, his increasing disapproval in the polls and Republicans’ apparent declining prospects in the mid-term elections.

It became obvious last week when Trump’s “Hamlet”-like erratic behavior on the shutdown was on full display.

First he was quoted by the Daily Caller last Tuesday saying he didn’t “like the idea of a shutdown” and wouldn’t cause one before the election. But on Wednesday he seemed to change his mind telling reporters “if (a shutdown) happens, it happens.”

There’s still little-to-no certainty about whether Trump will cause the government to shut its doors.

The next day, Trump said on “Fox and Friends” that he wouldn’t shut down the government before the election but would instead wait until afterwards in the lame duck session of Congress so the shutdown wouldn’t have negative political repercussions for Republicans.

But then on Friday, as The Washington Post’s John Dawsey, who was on the plane, tweeted that Trump told reporters on Air Force One the opposite of what he had indicated on Thursday: A shutdown would be good for the Republicans running for reelection this November.

Last week demonstrated that what Trump says on any given day greatly depends on who he has just talked to. Early last week it was House Speaker Paul Ryan (R-WI) and Senate Majority Leader Mitch McConnell (R-KY), both of whom argued against a shutdown…and Trump agreed.

Trump took his cues later in the week from the people who attended his rallies and responded very enthusiastically when he mentioned a shutdown…and he agreed.

By Friday, Trump cited right-wing icons Sean Hannity, Rush Limbaugh and Mark Levin as encouraging him to shut down the government to force Congress to give him what he wants for his wall…and once again Trump agreed.

So far Trump has repeatedly huffed and puffed about shutting the government only to back down at the last-minute either in response to a vague promise by Ryan and McConnell to get him his funding later or in response to pleas from the White House staff to sign whatever Congress has sent him.

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But even though Ryan, McConnell and the White House staff will all be part of the play again this time and the outcome may be the same, there will also be several new scenes and characters.

For example, Trump is scheduled to be on the road holding rallies and campaigning for Republicans two more days in September. The pro-shutdown crowds that will be there could have a substantial impact on his thinking.

In addition, Hannity et al. may try to stay in closer touch with Trump over the next few weeks than they have in the past to thwart Ryan, McConnell and the White House staff’s inevitable attempt at last-minute influence.

And, of course, Mueller, Manafort, Sessions and the others will sill be around.

All of this means that the outcome of this shutdown fight, like “Hamlet,” won’t be known until the last act. For the shutdown, that probably means very late on September 30th.

It’s important for Trump to remember, however, that “Hamlet,” while a critical success, was also one of Shakespeare’s greatest tragedies.

Follow Stan Collender on Twitter @thebudgetguy.

 

 

 

Trump’s Latest Promise For No Shutdown Doesn’t Even Last Until Lunch

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I said in this post yesterday that I was unwilling to accept the statement Trump made earlier that afternoon that he wouldn’t cause a government shutdown as anything that would remain in place past lunch (EDT) on Thursday. That was posted at about 3:30 pm.

Turns out I was giving Trump way too much credit. As Politico pointed out, by 5:30 p.m. EDT, about 16 hours before Thursday lunch in Washington, Trump had completely changed his position and said about a federal shutdown, ““If it happens, it happens.”

According to Politico, Trump said:

“If it’s about border security, I’m willing to do anything. We have to protect our borders. If we don’t protect our borders, our country is not going to be a country. So, if it’s about border security, I’m willing to do what has to be done.”

As I said yesterday, Trump continues to be “consistently inconsistent” about a shutdown so everything he says about it on any day should be taken with at least a grain, if not a whole shaker, of salt.

Bottom line: There’s still a 60 percent chance of a shutdown.

 

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Should We Believe Trump When He Says There Will Be No Shutdown?

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Reuters reported on Wednesday that President Donald Trump said there would be no federal government shutdown before the election this November. According to Political WireTrump said, “I don’t like the idea of shutdowns. I don’t see even myself or anybody else closing down the country right now.”

It’s important to ask what Trump means by “right now.”

If this was even close to a normal presidency Trump’s latest statement would immediately get me to reduce what I had said was a 60 percent chance of a shutdown this fall.

But…and to be kind…Trump is not a “traditional” president and this is anything but a normally operating White House.

First, Trump has changed his mind so often on government shutdowns that it’s impossible to know what he really thinks about them. From tweets calling for a “good ‘shutdown'” to rants saying he would never sign another omnibus appropriation if it didn’t include money for his wall between the U.S. and Mexico to his repeatedly backing down from previous threats, Trump’s stance on shutting down the government has been consistently inconsistent.

Second, shutdowns aside, nothing Trump says on any particular day should be taken as gospel. As this great story by Glenn Kessler, Salvador Rizzo and Meg Kelly in The Washington Post details, Trump has made 4,713 false or misleading statements in his first 592 days in office. As a result, he definitely doesn’t deserve the benefit of the doubt about his current position on a shutdown.

Third, there’s almost no doubt in my mind that, as they have in the past, Republican congressional leaders promised Trump something in return for his Reuter’s-reported statement, something they may not be able or plan to deliver. If and when Trump realizes that House Speaker Paul Ryan (R-WI) and Senate Majority Leader Mitch McConnell (R-KY) are playing him…again…all current shutdown bets will be off.

Fourth, we still can’t discount Trump’s needs to divert attention away from Mueller, Manafort, Cohen and now Bob Woodward’s new book. And with Manafort’s second trial set to begin just a week before fiscal 2019 starts and Trump confidant Roger Stone seemingly about to get indicted, the biggest diversion of all will be a shutdown.

Because of all this, I’m unwilling to accept the Trump statement that he won’t cause a government shutdown as anything that will stay in place long-term, that is, past lunch (EDT) tomorrow.

Follow Stan Collender on Twitter @thebudgetguy.

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Trump Federal Pay Freeze Makes No Sense Whatsoever

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Last Thursday and Friday was a reelection nightmare for Rep. Barbara Comstock (R-VA).

Just as it was starting to be reported that the GOP establishment might divert financial resources away from Comstock to other Republican reelection races, President Donald Trump put a political shiv in her attempt to win a third term this November by announcing his unilateral decision to cancel the across-the-board pay and locality pay increases for 2 million federal civilian employees and, therefore, harm a great many of the congresswoman’s constituents.

The potential redistribution of GOP campaign support was mostly of interest to contributors and other political insiders, but Trump’s pay freeze was an economic and emotional slap in the face to the thousands of federal employees and the many businesses that rely on them all across Comstock’s district in Northern Virginia. At virtually the same time the government was reporting that inflation had increased to 2 percent, a 6-year high, federal civilian workers were being told that their pay would not be increased to compensate for this loss in buying power.

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Comstock quickly issued a statement opposing the pay freeze, but that’s not likely to undo the Trump-caused damage to her reelection. The reality was that Comstock had been unable to prevent a President from her own party not just of taking aim at a substantial number of her constituents but of making a direct hit on their livelihoods, and it was obvious.

The big question is why would Trump do this.

With polls showing that its House majority is very much in jeopardy this election and each currently held GOP seat is precious, making reelection more difficult for even one Republican representative makes no sense whatsoever. This is especially the case because of the reporting last week that the White House is starting to realize how a Democratic majority in the next Congress could investigate the Trump administration’s and family’s activities and policies in ways and to an extent the GOP has refused to do.

The pay freeze also makes no sense as a sop to Trump voters. While there’s little doubt that Trump saw the pay freeze as a way to demonstrate that he is punishing what he and his voters refer to as “the deep state” for its sins, denying cost-of-living adjustments is unlikely to be much of an issue for the president’s base. Trump might be able to use it as a throwaway line at one of his rallies, but his reelection will never depend on it.

It also makes no sense from a federal budget perspective. Although Trump said that fiscal responsibility was the sole reason he was implementing the pay freeze, the savings from doing so are tiny both in terms of a total federal budget that will exceed $4 trillion next year and its projected $1 trillion deficit.

Trump’s reduce-the-budget rationale for his federal pay freeze proposal also seems ludicrous in light of the trillion-dollar revenue loss from the tax bill he signed last year, his demand for $25 billion to build a wall between the United States and Mexico, the $12 billion cost of his decision to compensate farmers for the impact of his tariffs and the unestimated (but likely to be in the billions) cost of a space force.

Finally, the Trump pay freeze makes no sense because it will very likely be reversed by Congress. The Senate has already agreed to do exactly what the president doesn’t want by providing a cost-of-adjustment for federal civilian employees and House Republicans are very likely to support that given how vulnerable they are to losing their majority this November.

Some are suggesting that this was Trump’s plan all along by proposing something that Comstock and other Republicans with a substantial number of federal employees in their congressional districts and states take credit for reversing. And in response to GOP criticism he has already said he would “study” the issue.

But that strategy assumes the White House is capable of playing the political equivalent of multi-dimensional chess, that Congress will actually reverse the pay freeze, that the president will sign the legislation with the reversal in it and, most importantly, that the federal employees who vote in Republican-held districts will forget how angry they were by Election Day.

One or more of these assumptions is almost certain to be wrong. That has to make you wonder what Trump was really thinking.

Follow Stan Collender on Twitter @thebudgetguy.

 

Why Democrats Are Screwed Even If They Win

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By Bruce Bartlett*

Various pollsters give Democrats a pretty good chance of getting control of the House of Representatives next year, with an outside chance of the Senate as well. Many Democrats are expecting a complete reversal of Trump-Republican policies. This is at best naïve and at worst displays gross ignorance of our system of government.

I don’t wish to rain on the Democrats’ parade, but they must remember that either Donald Trump or Mike Pence will be president until January 20, 2021. All presidents have veto power and enacting legislation over a veto requires a two-thirds majority in both houses of Congress, something Democrats will not have.

Moreover, Democrats’ odds of getting the Senate this cycle are small and their House majority, should they get it, is likely to be slim. Nor are Democrats united on an agenda or their leadership going forward. The issues their candidates for the 2020 Democratic presidential nomination are likely to make will make the achievement of consensus difficult.

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This is not to say that there is nothing Democrats can do even with just House control. But they must dampen expectations lest their base become dispirited by their failure to achieve much of anything, legislatively, until at least 2021.

I have some insight on this because I worked in the Senate after Republicans unexpectedly won control in the 1980 elections. Since Democrats still had solid control of the House, bipartisanship was baked in the cake, although at least we didn’t have to worry about a presidential veto.

Moreover, I was still a Republican in 1994 (I’m now an independent) and was involved in planning the GOP agenda in Congress after the Republican takeover that year. Then as now, many activists needed to be reminded that there was a president of the opposite party and his veto pen was full of ink.

Based on my experience, here is a realistic scenario.

First, Democrats can and should investigate Trump and all the corruption among his cabinet and subcabinet that Republicans have turned a blind eye to. But they should not delude themselves that it will be easy. The administration will stonewall and try to run out the clock. Moreover, thanks to Republican budget cuts, Congress lacks the staff and resources to do the kinds of investigations that were done in the past. Republicans in the Senate will block efforts to provide additional resources.

Democrats will have to dampen expectations.

Second, Democrats need to find some way of chilling demands for impeachment without angering their base too much. While Trump certainly deserves impeachment, the chances of a Senate conviction are zero and the effort will waste a lot of time and energy. Anyway, removing Trump would just make Pence president. From a policy point of view, nothing will change.

Third, Democrats should have the Joint Committee on Taxation obtain all of Trump’s tax returns and review them thoroughly. It already has the legal authority to do this. But Democrats should not expect a smoking gun. The returns themselves may say little without also seeing the supporting data and documentation that the IRS itself only sees in an audit. Also, privacy laws will still apply and it will take much time for the returns to be analyzed.

Fourth, Democrats can make a down payment on restoring funds for programs that have been slashed by the GOP. But Republican control of the Senate will limit what can be done and Trump has made clear that he has no fear of the political consequences of a government shutdown resulting from vetoing appropriations bills.

The biggest problem Democrats will have is dealing with the budgetary time bomb Republicans have planted with their tax cut.

Fifth, Democrats can do a lot to put meat on the bones of an agenda their nominee can run on in 2020. Hearings must be held, speeches given and reports written detailing potentially popular Democratic ideas such as Medicare for All. Democrats must remember that they will be held to a much higher standard by the media than Republicans have. Democrats are the party of responsibility and must bear a burden for that.

The biggest problem I foresee Democrats having is dealing with the budgetary time bomb that Republicans have planted with their tax cut. It is absolutely guaranteed that Republican hypocrites and media scolds will demand immediate action on the deficit as soon as the new Congress convenes. Enough Democrats and their Wall Street contributors will agree to force action.

Republicans will insist, of course, that 100 percent of deficit reduction be done on the spending side. Their long-term goal has always been to force Democrats to cut programs like Social Security and Medicare so that Republicans don’t bear the blame.

Republicans will also insist that, even with the tax cut, revenues are more than adequate to fund the federal government. They will ignore the fact that the major driver of long-term spending is interest on the debt resulting from tax cuts with no reduction in spending, wars without end and trillions for militarily dubious high-tech weapons systems and unfunded Republican programs like Medicare Part D.

Needless to say, tax increases will be off the table. The only person Republicans fear as much as Trump is Grover Norquist, whose no tax pledge guarantees defeat for any Republican who supports even the most modest tax increase. (Apparently, tariffs are okay.) Any tax increases Democrats manage to achieve will be small and grossly inadequate to our fiscal needs.

It is likely that macroeconomic conditions will also force Democrats into the trench warfare of deficit reduction. Inflation has been well-behaved for a long time, but Republicans just added a huge dose of fiscal stimulus to an economy that was already running on all cylinders. Historically, this has been a recipe for inflation. Moreover, the Federal Reserve will continue raising interest rates. While this should theoretically dampen inflation, it will nevertheless make the deficit a more salient political issue. It will be easy for politicians to sell Americans on the idea that interest rates are rising due to deficits rather than Fed policy.

Democrats will find themselves between a rock and a hard place – between demands for action from their base that cannot be fulfilled and enormous pressure to reduce deficits without any help from tax policy.

It is possible that Democrats may keep their base under control with some symbolic victories – getting Trump’s tax returns would be a big one. Robert Mueller’s investigation will continue and presumably deliver more indictments and convictions. Hearings will provide forums for Democrats to highlight Republican corruption and the deleterious effects of their policies. By the end of next year all eyes will turn to the run for the White House. This should give Democrats the leeway to do little substantively without depressing their base too much. The real action will come in 2021.

* Bruce Bartlett (@brucebartlett) worked in Congress from 1976 to 1984, at the White House from 1987 to 1988, and at the Treasury Department from 1988 to 1993. His latest book is The Truth Matters: A Citizen’s Guide to Separating Facts and Lies and Stopping Fake News in Its Tracks https://www.amazon.com/Truth-Matters-Citizens-Separating-Stopping/dp/0399581162/.