Budget Deal Reopens Government
February 09, 2018
Congress reaches budget deal to raise spending and reopen government; White House unveils proposals aimed at curbing high drug prices; Wholesale inventories increase 0.4% in December compared to estimate of 0.2% gain.
- Congress reaches budget deal to raise spending and reopen government. President Trump signed into law a far-reaching budget deal on Friday morning that will increase spending by hundreds of billions of dollars and allow the federal government to reopen after a brief shutdown. His signature came quickly after the House approved the deal early on Friday, after a one-man blockade by Senator Rand Paul of Kentucky delayed the votes and forced the government to briefly close. After threatening to bring the bill down because it did nothing to protect young undocumented immigrants, House Democrats gave Speaker Paul D. Ryan of Wisconsin the votes he did not have in his own party and ensured passage of the bill. 73 House Democrats voted yes to the budget deal, offsetting the 67 Republicans who voted no. The deal includes about $300 billion in additional funds over two years for military and nonmilitary programs, almost $90 billion in disaster relief in response to last year’s hurricanes and wildfires, and a higher statutory debt ceiling. The new budget should pave the way for a measure of stability through September 2019. [NYTimes]
- White House unveils proposals aimed at curbing high drug prices. The Trump administration on Friday laid out an in-depth proposal to fight high drug prices yet, an area that is a high priority for President Trump yet has seen little movement thus far. The 28-page document released by the White House on Friday, ahead of the president’s budget proposal on Monday, lists a range of policies aimed at making medication more affordable. The proposals include a cap on out-of-pocket spending for enrollees in Medicare’s prescription drug program, allowing up to five states to come together to negotiate drug prices for Medicaid and cut Medicare payments to remove an incentive for doctors to prescribe higher-priced drugs. The proposals, while controversial, do not include some more sweeping measures that Trump has favored in the past, including allowing Medicare to negotiate drug prices or allowing the import of drugs from abroad. These ideas are generally more favored among Democrats. [The Hill]
Economic Indicators & News
- Wholesale inventories increase 0.4% in December compared to estimate of 0.2% gain. According to data from the Commerce Department, U.S. wholesale inventories increased 0.4 percent to a value of $612.1 billion in December, beating estimates of 0.2 percent growth for the month. In November, the amount of unsold inventories for wholesalers jumped 0.6 percent, rebounding from October. The November figure was revised down from 0.8 percent in an advance report that was released on Friday. At current levels, it would take wholesalers 1.22 months to clear their shelves, a faster rate than the year-ago ratio of 1.29. The monthly metric comes from a survey of about 4,200 U.S. wholesale firms. [CNBC]