Tag: Donald Trump

Trump May Not Really Want A Government Shutdown Now Over His Wall

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I’ve consistently been one of the most bullish people about the possibility of government shutdowns. I’ve seen one around every corner, behind every door and under every rug.

But I’m changing my stripes — or animals — from bull to bear over the potential Trump-induced shutdown this December that some think is close to inevitable. It may be far less likely than many are assuming.

If there is a fight, it will be over funding for the wall President Trump wants built between the United States and Mexico. GOP leaders talked Trump into waiting until after the election to make a stand and, with the continuing resolution set to expire in less than two weeks (take a look at the countdown clock on the budgetguy.blog’s home page for the exact number of days as of when you read this), the deadline is rapidly approaching.

But is the showdown rapidly approaching as well?

On the one hand, it makes sense for Trump to push now for the $5 billion (out of what’s been reported to be a total cost of $25 billion or more) he wants for his wall in fiscal 2019. With Republican control of the House of Representatives about to end, this December could be Trump’s last chance to get it.

Trump has shown himself to be a total wimp when it comes to making good on his previous threats to shut the government.

Or, if he waits until the next Congress, the only way Trump might get the funds may be to make a deal with the new Democratic House majority that will likely want something he finds especially distasteful — his tax returns, compliance by his family and cabinet with congressional subpoenas, etc. — in exchange.

If that’s his thinking, a shutdown this December will be a real possibility.

But that might not be his thinking.

Trump may actually prefer not to get his wall this December because it may be politically better for him to:

1. Keep the issue of the wall alive over the next two years so he can continue to use it as he runs for reelection.

2. Use the issue to enrage and motivate his base over immigration.

3. Blame the next Congress’s Democrat-controlled House rather than this Congress’s Republican-controlled House and Senate for not providing the funding.

For all his chest thumping, tweet-storming and budget braggadocio, Trump has shown himself to be a total wimp over shutting the government. Rather than vetoing an appropriation that didn’t have the money he wanted for his wall, Trump has repeatedly…and very noticeably…backed down.

That’s one of this biggest reasons that what Trump said to reporters just a week or so ago –“This would be a very good time to do a shutdown” — wasn’t taken as anything but more of his huffing and puffing and yet another empty threat to blow the government’s house down.

It’s also one of the big reasons there may not be as much to this latest shutdown ultimatum as it appears.

Follow Stan Collender on Twitter by clicking here on @thebudgetguy.

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Don’t Completely Discount Trump’s Talk Of A 10% Tax Cut Just Yet

 

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No matter the topic, Donald Trump has proven again and again both that he’s not very articulate and that his knowledge of the U.S. Constitution, the legislative process in general and the congressional budget process in particular is limited.

That’s why it hasn’t been surprising that those who are closely following the federal budget and the midterm election almost immediately dismissed Trump’s talk of a ten percent tax cut for middle-income Americans in the next two weeks as a desperate campaign stunt rather than a serious proposal. After all, Congress won’t even be in session.

That’s probably still the most likely analysis of the situation, especially because there have been ample reports that the Republican congressional leadership, including the chair of the House’s tax-writing committee, was caught unawares by Trump’s statement and disavowed all knowledge of the plan.

But what if, rather than making an off-the-wall campaign promise that he has no plan to pursue when the election is over, Trump was actually inarticulately stating what he wants to do and how he plans to do it?

The clue might be Trump’s use of the word “resolution” when explaining how he was going to proceed.

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As reported by CNBC, Trump told White House reporters yesterday,”We’re putting in a resolution some time in the next week and a half to two weeks [and] we’re giving a middle-income tax reduction of about 10 percent.” (emphasis added)

Trump’s use of the word “resolution” might be due to his lack of understanding of how Congress works. But it’s curious that he didn’t use a simpler and more common word like “bill,” legislation,” or “proposal” to describe what he was going to put in.

This is particularly interest because “resolution” has a special meaning in the congressional budget process. Using a “budget resolution” as the first step on the path to the tax cut would make it much much easier to enact.

As I explained in this post yesterday, Congress adopting a budget resolution could prevent the new Trump tax plan from being filibustered in the Senate because that would enable it to be considered with reconciliation, the same procedure used to pass last year’s tax bill.

That’s not to say that going the budget resolution route would be easy or politically painless, but it could work. Here’s how I described it in my post yesterday;

“The process could be expedited if the House passed the budget resolution already adopted by its budget committee, if the Senate then agreed to what the House passed with an amendment requiring reconciliation, if the House then passed the budget resolution with the Senate amendment, if the House Ways and Means Committee quickly adopted the Trump plan, if the full House quickly passed what the committee approved and if the full Senate bypassed its Finance Committee and adopted the House-passed bill without making any changes.”

It’s not at all hard to imagine Trump being briefed by his staff on this very complicated procedure and that he then garbled what he was told when he described his tax plan to reporters.

Then again, it’s also very possible that there really is no tax plan of any kind.

Follow Stan Collender on Twitter by clicking here @thebudgetguy.

 

 

New Promised Trump Tax Cut Is A Big Nothingburger

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President Trump made headlines late last week with another of his shoot-from-the-hip policy pronouncements, this time that there would be a tax cut before the midterm elections. According to The Washington Post, Trump said the cuts would get done “sometime just prior, I would say, to November.”

I’m going to give Trump the benefit of the doubt and assume that he meant that only the specifics of his new tax proposal would be announced rather than that the plan would be enacted prior to November. With Congress out of session and the GOP leadership almost certainly against calling its members back to Washington during the final days of the election, it’s hard to imagine that he meant anything but that there would be an announcement.

(I shudder to think about the possibility that Trump either thought this actually could get done legislatively over the next two weeks or that he could ignore the U.S. Constitution and simply impose the changes he wants without congressional action.)

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But even assuming that what Trump meant was just an announcement, it’s hard to see how what he might propose (For the record, I’m not at all convinced he will actually propose anything) can get done in the lame duck. Here’s why.

1. The Trump tax plan can be filibustered in the Senate.

2. Unless Majority Leader Mitch McConnell (R-KY) is willing to do away with the legislative filibuster, which he so far has been completely unwilling to do, the only way to avoid a filibuster of the Trump tax bill will be to do it as a reconciliation bill.

3. But reconciliation may only be done if both houses of Congress adopt a budget resolution conference report with reconciliation instructions ordering it…and neither the House nor Senate have passed a budget resolution yet this year. The House Budget Committee has approved one but there has been no activity in the Senate.

4. Therefore, before a new Trump tax plan could be considered, a budget resolution with its projected trillion-dollar deficits would have to be adopted. That will be much easier to do after than before the election, but still won’t be a simple vote for some GOP members even if it would make a tax cut easier..

5. And it will take time. Even with a truncated process, adopting a budget resolution is likely to take at least two weeks…and probably closer to three or four.

6. Meanwhile, votes become less reliable the longer a lame duck continues as retiring and defeated representatives and senators become less interested in their current job and more concerned about what’s next. If the past is any guide, some will even stop coming to Washington entirely.

7. This is not to say that enacting another tax bill will be impossible, just that it will be very difficult. The process could be expedited if the House passed the budget resolution already adopted by its budget committee, if the Senate then agreed to what the House passed with an amendment requiring reconciliation, if the House then passed the budget resolution with the Senate amendment, if the House Ways and Means Committee quickly adopted the Trump plan, if the full House quickly passed what the committee approved and if the full Senate bypassed its Finance Committee and adopted the House-passed bill without making any changes.

8. That’s six ifs. Add in the typical no shows during a lame duck and you get a recipe for no action.

That will put the new Trump tax plan on the same legislative trash heap as his wall, his space force, his infrastructure proposal and his military parade.

Follow Stan Collender on Twitter by clicking here @thebudgetguy

Trump 5% Budget Plan Shows That He’s Weak

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President Trump tried to sound powerful when he announced that he had ordered his cabinet members to come up with five percent reductions in their fiscal 2020 department or agency budget.

Here’s why Trump’s plan is actually the total opposite of bold.

1. The plan isn’t for the current year (fiscal 2019); it’s for 2020, the budget that Trump is legally required to submit to Congress early next year and won’t start to be implemented almost a year from now. In the meantime, Trump’s own Department of Treasury and Office of Management and Budget project that the deficit will grow by $306 billion to almost $1.1 trillion. Trump isn’t proposing to do anything about that.

2. Trump could have proposed that Congress “un-appropriate” spending in the current year by using the impoundment control procedures specified in the Congressional Budget Act. He didn’t.

3. Trump’s pronouncement was that his cabinet come up with a plan to reduce “discretionary” spending within their agency or department. That’s only about 25 percent — roughly $1.1 trillion — of the total amount expected to be spent in 2019.

(Note: The $1.1 trillion in discretionary spending is roughly equivalent to the total projected 2019 deficit. Trump would have to propose to eliminate all of it to completely balance the budget this year.)

4. If Trump had wanted to propose something impactful he would have included most of the rest of the budget — mandatory spending other than interest on the national debt. But just before the election that would have subjected him to the very politically damaging charge that he was going to propose cuts in Social Security, Medicare and veterans benefits.

5. There is a strong possibility that this wasn’t even the new order Trump made it out to be. Asking cabinet departments to develop different spending-cut scenarios (-2 percent, -5 percent, etc.) is the standard procedure every president uses early in the year to formulate the budget. There’s a good chance, therefore, that the cuts Trump just said he ordered were actually developed around this past June.

In other words, the Trump five percent cut plan was just about the least he could say he would do and still sound like he was doing something.

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Trump Will Say Democrats Stole The 2018 Election…And 7 Other Predictions

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Less than a month before the election, about a month before the start of the lame duck session of Congress, a little over about 50 days before the next government shutdown deadline on December 7 and less than three months before the next Congress begins, these 8 things are both keeping me up at night and giving me nightmares while I’m awake.

It’s therapeutic (at least for me) to share them.

1. Trump Will Insist The Democrats Stole The 2018 Election

If Democrats win one or both houses of Congress this November, Trump will insist that it happened because (1) they colluded with the Russians or Chinese, (2) they hacked the election results in all 50 states, (3) illegal immigrants voted in record numbers or (4) all of the above. Trump will say he has information proving that the results weren’t a referendum on him, that he doesn’t plan to change a thing and that he will make the Democrats pay for stealing the election.

Then see #s 5,6, 7 and 8 below.

2. Big Federal Budget Deficits Are Now Permanent

The Trump administration will soon verify what the Congressional Budget Office reported last week.  When the U.S. Treasury releases its monthly statement for   September, it will confirm that the fiscal 2018 federal budget deficit increased to close to $800 billion dollars this past year and will be at or above $1 trillion for 2019.

But that will be just the beginning.  With more tax cuts about to be considered (see #3), a trillion-dollar infrastructure plan likely to be enacted at some point in the next few years, hurricanes and other disasters almost certainly on the horizon and no serious revenue increases or spending reductions likely to be considered, $1 trillion or higher federal budget deficits are now a permanent part of the U.S. economy and American politics. The previous political goal of projecting on paper (let alone actually achieving) a balanced budget in 10 years is now gone…forever.

3. Another Huge Tax Cut Will Happen This Year

I’m increasingly convinced that, during the lame duck, the Senate will take up the tax cut the House passed just before it recessed for the election. My sources on Capitol Hill tell me that preparations are already underway for Congress to quickly adopt a budget resolution at the start of the lame duck just so the Senate will be able to avoid a filibuster on the tax bill.

This will increase the deficit by another $600 billion to $700 billion over the next decade, and much more after that.

4. The Budget Deficit Will Reach $2 Trillion By 2024

There will be an economic downturn at some point over the next few years. Combined with #2 and #3 above, this will increase the deficit to close to $2 trillion.

5. Trump Will Ignore Democratic Subpoenas And Set Off A Huge Appropriations Fight

The common assumption seems to be that, if the Democrats are in the majority in one or both houses of Congress next year, as part of official committee investigations they will inundate the Trump administration with subpoenas for documents and witnesses. Not only do I seriously doubt that the White House will meekly comply with these subpoenas, I expect the president to routinely assert every possible reason that he doesn’t have to do so.

Yes, the courts will then get involved. But I also expect congressional Democrats to use next year’s appropriations process to push the administration to comply. It wouldn’t be shocking, for example, if Democrats threaten the funding for several assistant secretaries and the White House counsel in response to the White House’s stonewalling.

6. Shutdown Showdowns Are About To Become Even More Of A Thing

There will be multiple shutdown fights for two reasons.  First, Trump may not agree to full-year funding in any form (a continuing resolution, omnibus appropriation or Department of Homeland Security appropriation) without money for his wall. He’s far more likely to agree to a series of short-term funding bills that allow him to keep raising the issue, especially if he’s able to blame a Democratic majority for the wall not happening. That will set up frequent shutdown threats every year.

Second, see #5.

7. Trump Will Precipitate A Debt Ceiling Fight Sooner Than Expected

The federal debt ceiling was suspended by the Bipartisan Budget Act of 2018 until March 1, 2019, and the overwhelming assumption is that the Treasury will use “extraordinary measures” (the Washington equivalent of getting a cash advance on one credit card to make a payment on another) to delay raise the debt ceiling until September.

But just because Treasury has always used extraordinary measures in the past doesn’t mean it’s guaranteed to use them this time. Trump could easily at least threaten not to use these bookkeeping gimmicks at all or to stop using them at some point before September if the president doesn’t get something (such as funding for his wall, a space force and a military parade) he wants in return.

8. Trump 2020 Budget Will Be An Even Bigger Political Statement

The first two Trump budgets basically were campaign brochures masquerading as official federal documents. The next Trump budget — fir fiscal 2020 budget — will be released as his reelection efforts formally get underway and so will have very little to do with governing. It will be largely forgotten on Capitol Hill within two weeks of it being released.

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Donald Trump Is A Federal Budget Wuss

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The fiscal 2019 appropriations Congress is sending the White House include much more spending than the president requested, don’t have most of the spending cuts he proposed, don’t provide the $5 billion he demanded for the wall he wants built between the United States and Mexico and don’t stop funding for Planned Parenthood.

That’s much more than just a slap of Trump’s face by the GOP-controlled House and Senate: It’s a crack upside his head with a 2×4.

And, in response to Congress’s almost wholesale rejection of his budget priorities, Trump did…wait for it…nothing, or at least nothing meaningful.

Yes, on multiple occasions over the past year Trump huffed and puffed and menacingly threatened to blow Congress’s house down by shutting the federal government if he didn’t get what he wanted.

But when faced with the opportunity this week to veto the legislation that didn’t provide any money for his wall and actually to shut down the government, Trump ran from the fight he had been threatening so loudly for so long. While he was 250 miles away from Capital Hill in New York, Trump meekly said he would avoid the confrontation with Congress and sign whatever he was sent.

In other words, Donald Trump is a federal budget wuss.

This was a not strategic retreat by the White House. If anything, it’s going to be even harder for Trump to get what he wants on spending and taxes in a lame duck session than it was before. This was his best chance.

This is especially true of funding for his wall. Congress has already refused multiple times to provide the funds Trump wants and that isn’t likely to change after the election. That’s particularly true if the Democratic wave many are predicting actually happens and Trump’s policies become even less important to Republicans.

It’s also true of Trump’s other budget priorities. The two “minibus” appropriations that Trump’s signature will enact will provide funding for the full fiscal year and include the majority of the spending the president gets to approve. Trump simply won’t be able to have that much of an impact on what’s left even if he tries.

But even more important than the rejection of his budget policies is the fact that Congress played Trump like a virtuoso and he was unable and unwilling to do anything about it.

That kind of weakness is always recognized and seldom, if ever, forgotten.

Follow Stan Collender on Twitter @thebudgetguy.

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