Tax reform | USDA reports | House spending bill | Perdue talks to NFU, goes to New Orleans | Trade policy | Trump to meet Malaysian PM | 9/11 anniversary
Key congressional issues were settled or at least delayed late last week as President Donald Trump signed legislation Friday suspending the debt ceiling, providing stopgap funding through Dec. 8 and approving $15.25 billion for hurricane relief under a deal he worked out with Democrats that surprised and upset conservative Republicans — 90 mostly conservative House Republicans voted against the measure. All 183 House Democrats who voted supported the measure. The Senate approved the bill last Thursday. Link for details of last Friday’s legislative action and signing of the package by President Trump.
Tax reform; more disaster aid funding ahead. The focus now turns to rewriting the U.S. tax code by the end of the year and working on additional disaster aid funding.
The White House signaled it will be back for more emergency funding to aid hurricane relief efforts in states expected to be hit by Hurricane Irma. “We’re going to have to go back, I’m sure, for additional resources as these storms continue to hurt our states and our citizens,” Thomas Bossert, the president’s homeland security adviser, said.
Regarding tax reform, some members of both parties believe President Trump may now explore a potential bipartisan tax agreement before a likely fallback plan of a Republican-only package. The tax blueprint that House Republicans campaigned on seeks a 20% corporate rate, while Trump’s tax principles in April called for 15%. “Our goal is to get to mid- to low 20s,” House Speaker Paul Ryan (R-Wis.) said on Thursday during a New York Times forum. On individual rates, particularly for wealthy people who do not own businesses, there is a deep divide between the parties, with Democrats opposing reductions for the rich.
Tax reform strategy. Senate Majority Whip John Cornyn (R-Texas) said the timing for any bipartisan deal agreement would have to be before a Finance Committee tax markup. The second-ranking Republican said the GOP will wait to see if Senate Finance Chairman Orrin Hatch (R-Utah) — or Trump — finds bipartisan interest in a tax deal, while also preparing to advance a fiscal 2018 budget resolution that will frame a reconciliation bill that would expedite the GOP tax package. Under reconciliation, a tax package can pass the Senate by simple majority vote. “We will also pass a budget resolution and then get reconciliation instructions as a fallback, but we are going to try,” Cornyn said. House Budget Committee Chairman Diane Black (R-Tenn.) said it’s possible the resolution cold get a vote the last week in September. Black has been trying to generate support for the measure in recent weeks, but several Freedom Caucus members have been withholding support until more details about a tax plan are released.
Trump comments on tax reform. “Republicans must start the Tax Reform/Tax Cut legislation ASAP. Don’t wait until the end of September. Needed now more than ever. Hurry!,” Trump said in a tweet the morning of Sept. 8. A day earlier, a White House official said the administration and GOP lawmakers had reached agreement on several specific items in a tax reform bill. Ways and Means Tax Policy Subcommittee Chairman Peter Roskam (R-Ill.) said members are eager to see details of a tax bill, not so much frustrated that it hasn’t been released. “This is the season where we will either pass this or this will be the biggest fish that got away,” he said.
House to focus on spending bill. The House wants to complete work on an eight-bill appropriations measure relative to fiscal 2018, which begins Oct. 1. It combines bills that fund nearly all the departments and agencies of USDA, the Food and Drug Administration, the Interior and Labor departments, and the Environmental Protection Agency. On Friday, the House adopted an amendment that would restrict the ability of the Environmental Protection Agency or the Interior Department from paying legal fees for settlement of cases under the Clean Air Act, the Clean Water Act, and the Endangered Species Act.
Other events this week include:
- USDA Secretary Sonny Perdue will speak to leaders of the National Farmers Union on Monday, when the group is at USDA as part of its annual fly-in.
- Perdue will go to New Orleans for a speech before the National Association of State Departments of Agriculture (NASDA) on Thursday during its annual meeting. The commissioner of the Food and Drug Administration, Scott Gottlieb, will address NASDA on Tuesday.
- The Senate Agriculture Committee continues its new farm bill hearings with a session Thursday on nutrition programs.
Regarding trade policy, Commerce Secretary Wilbur Ross is the lastest Trump official threatening to withdraw from the North American Free Trade Agreement (NAFTA) if a new deal favorable to the U.S. can’t be reached with Mexico and Canada. “The president has made clear if they don’t work, he’s going to pull out,” Commerce Secretary Wilbur Ross said Friday during an event at the Washington Post. “That shouldn’t be a shock to anyone, and really that’s the right thing. We need fixes to this deal. It has not worked the way it was intended.” Link for details.
As for the NAFTA 2.0 timeline, Ross said: “There’s no fine line magic date, but more or less by the end of the year is probably when we’re going to need to know where we are.” The next negotiating session takes place Sept. 23-27 in Ottawa.
President Donald Trump on Tuesday will meet with Malaysian Prime Minister Najib Razak at the White House. Razak is embroiled in a corruption scandal at home involving 1MDB, a fund he set up and which now faces money-laundering probes in at least six countries, including the U.S., Switzerland and Singapore.
Trade talks on tap before Trump and Malaysia’s leader meets. Senior U.S. and Malaysian trade officials will meet in Washington Sept. 11 ahead of a summit meeting the next day between leaders of the U.S. and Malaysia. Heading the trade policy talks will be U.S. Trade Representative Robert Lighthizer and Mustapa Mohamed, the Malaysian minister of international trade and industry. The two are likely to discuss the U.S. goods deficit with Malaysia, which reached $24.8 billion in 2016. The two countries established working groups in July, including one on trade in goods, under the U.S.-Malaysia Trade and Investment Framework Agreement (TIFA). Razak said initial discussions on the feasibility of relaunching bilateral negotiations and the time frame for concluding them with the U.S. are on the agenda, according to several press reports from Kuala Lumpur.
9/11 anniversary. The U.S. marks the 16th anniversary of the terrorist attacks on New York’s World Trade Center and the Pentagon. In Washington, President Trump will join a moment of silence in the White House, while at Ground Zero there will be four moments of silence at the times when each plane hit and each tower fell.
Key reports this week include:
Agriculture:
Monday: USDA Crop Progress, Export Inspections
Tuesday: USDA’s monthly WASDE report on crop supply and demand — Link for pre-report expectations
Tuesday: Brazil’s crop agency Conab releases corn, soy production estimates
Tuesday: ABARES updates production forecasts for Australian wheat, barley, canola
Wednesday: EIA U.S. weekly ethanol inventories, production
Thursday: Weekly Export Sales
Economic:
Wednesday: Producer Price Index
Thursday: Aug. Consumer Price Index
Friday: Aug. Retail Sales
Energy:
Tuesday: EIA releases the monthly short-term energy outlook, or STEO. Around 11 a.m. CT.
Tuesday: OPEC monthly market report
Thursday: EIA releases International Energy Outlook 2017.
