Former GOP lawmakers push Republicans to block emergency declaration.
February 25, 2019
President Trump will delay tariff increases on Chinese imports. On Sunday, Trump cited progress in U.S.-China trade talks as the basis for delaying the tariff increase which was set to take effect later this week. Should this progress continue, Trump intends to plan a summit in China to end the yearlong trade fight. This announcement follows Chinese negotiators’ concessions to American businesses, which are said to include offers to increase their purchase of farm and energy products, lower restrictions on financial services and auto manufacturing companies, and protect intellectual property rights. However, the Chinese have made no concessions modifying their state-led economic model. As of now, there is no consensus on how a final deal would be enforced or how compliance would be judged. [WSJ]
Former GOP lawmakers push Republicans to block emergency declaration. Nearly two dozen former congressional GOP members wrote an open letter urging current GOP legislators to reject President Trump’s declaration of a state of emergency to build the U.S.-Mexico border wall. In the letter, the former lawmakers cite concerns over constitutionality and argue this move sets a dangerous precedent for future presidents. On Tuesday, the House will vote on a measure to block the emergency declaration, which is expected to pass. Then, a simple majority in the Senate is required to approve the measure. However, the prospect of a Trump veto remains. [Politico]
White House plans to counter consensus on climate change. Officials reported that the panel, to be formed under a National Security Council initiative, will reassess previous government climate analysis and counter conclusions linking the burning of fossil fuels to environmental damage. This goes against scientific consensus, which states that dire consequences will result if countries do not significantly reduce their carbon output. The group would include select federal scientists who are skeptical of climate change and of human contributions to climate change. The group would not be a formal federal advisory committee, so it would be exempt from requirements to meet in public, maintain a representative membership, and respond to public records requests. [Washington Post]
Lawmakers attempt to repeal cap on tax deductions. Efforts to repeal the $10,000 cap on State and Local Tax (SALT) deductions are gaining traction as taxpayers complain about receiving lower refunds and paying higher taxes. The SALT cap is opposed by lawmakers in high-tax states. On Friday, a group of Democratic governors held a press conference to pressure Congress into restoring the full SALT deduction after data from the Internal Revenue Service (IRS) during the first three weeks of the 2019 tax-filing season indicated average refunds were declining. Although the cap will likely not be repealed during the next two years, given the opposition by the Republican-controlled Senate, Democratic leaders have indicated that they will continue pressuring the Senate to act. [The Hill]
Economic Indicators and News
Wholesale inventories post largest gain in over five years. U.S. wholesale inventories jumped 1.1% in December despite sales falling 1%. The ratio of inventories to sales is at its highest level since mid-2016, hinting at an unintended piling up of goods. Despite this, the rise in inventories could lead to an increase in projected estimates of fourth-quarter gross domestic product. [Reuters]