Congress Weighs Future Legislation while Experts Gauge Economy’s Health
May 23, 2017
The GOP is looking ahead at tax reform cautiously after running into roadblocks with the American Health Care Act. Meanwhile, their colleagues in the Progressive Caucus are planning to release an infrastructure plan with more direct spending than the anticipated White House plan. The White House’s budget proposal is also facing scrutiny from many economists while the Federal Reserve is gauging the health of the economy before its June meeting.
- With the House’s bill to repeal and replace the ACA was revived earlier this month, GOP leaders want to prevent something similar from happening on tax reform. To that end, they have been cautious about setting hard deadlines for tax reform legislation, even as they spend time gathering feedback at hearings and outreach sessions. Republican leaders intend to pass both health care and tax legislation without Democratic votes, which leaves little margin for error. The party can’t afford another major eruption over tax reform similar to the fight that nearly took down the healthcare bill. [The Hill]
- The Congressional Progressive Caucus will lay out its own infrastructure proposal this week, staking out a position ahead of a legislative debate over transportation that is expected to heat up later this year. This proposal attempts to paint a clear contrast with President Trump’s infrastructure vision by calling for direct public investment in roads, bridges and other public works, as opposed to providing “corporate giveaways” to spur private sector investment. [The Hill]
Economic Indicators & News
- The Trump administration estimates their economic policies, including the tax plan, would boost the nation’s growth rate and generate $2.1 trillion in revenue above current levels, an accounting assumption that allows the administration to claim the blueprint will balance the budget by 2027. However, expert economists and budget analysts are having a hard time agreeing with the numbers. [WSJ]
- It is too soon to declare victory on the labor market’s recovery from the recession despite recent improvements, Federal Reserve Governor Lael Brainard said. Core prices, which strip out volatile food and energy prices, fell in March from the prior months for the first time since 2010. Analysts blamed changes in cell phone plan pricing but the drop has raised worries that the economy might be slowing down. Ms. Brainard did not discuss the prospect of another interest rate increase at the Fed’s June meeting. But her comments suggest she remains concerned about the health of the labor market. [WSJ]