Happy Tuesday! We hope you had a good holiday weekend. We welcome you back this evening with the news that Ángel Hernández, who for years has been Major League Baseball’s most controversial umpire, known for a long history of bad calls, is retiring. Also, the Trump election-interference case in New York is almost in the jury’s hands, as the defense and prosecutors delivered closing arguments today.
Here's what else is happening.
Trump Woos Wealthy Donors With Promises of Huge Tax Cuts: Report
Former President Donald Trump has been busy with his criminal trial in Manhattan over the past few weeks, but he has still found time to meet with donors in his quest to return to the White House next year. According to The Washington Post’s Josh Dawsey, Trump has used his meetings with wealthy supporters to drum up exceptionally large contributions, while sometimes attaching his requests for money to promises that he will cut taxes or otherwise pursue policies that benefit the likes of oil company executives.
Trump’s approach has been both aggressive and notably transactional, Dawsey reports. In a recent meeting with major donors at the swanky Pierre Hotel in Manhattan, Trump said that a businessman had offered a $1 million donation to the Republican frontrunner’s campaign while stating a desire to have lunch with the candidate. Trump indicated that he wanted a much larger donation. "I’m not having lunch," Trump reportedly told the group. "You’ve got to make it $25 million."
After making it clear that he expects to receive exceptionally large donations from his wealthiest supporters, Trump pivoted to fiscal policy, telling the group that a victory by President Joe Biden would mean higher taxes after 2025, when many of the tax cuts signed into law in 2017 are set to expire. "The tax cuts all expire for wealthy and poor and middle-income and everything else, but they expire in another seven months and he’s not going to renew them, which means taxes are going to go up by four times," he said. "You’re going to have the biggest tax increase in history."
The description of the meeting is consistent with a report earlier this month that Trump had asked a group of oil executives gathered at his Mar-a-Lago Club in Florida to raise $1 billion for his campaign while promising to reverse Biden’s environmental regulations — an arrangement that would be a "deal" for the supporters, given the magnitude of the potential savings.
Dawsey reports that Trump’s "remarkably blunt and transactional" approach is raising legal questions. "By frequently tying the fundraising requests within seconds of promises of tax cuts, oil project infrastructure approvals and other favorable policies and asking for sums more than his campaign and the GOP can legally accept from an individual, Trump is also testing the boundaries of federal campaign finance laws," Dawsey writes.
A potential clash over environmental policies: Although there are certainly plenty of oil executives eagerly looking forward to looser regulations in a possible second Trump administration, some major Republican-leaning players in Washington may have other plans. Politico’s Kelsey Brugger reports that the U.S. Chamber of Commerce and the American Petroleum Institute could end up defending some portions of Biden’s signature environmental legislation, the Inflation Reduction Act, from Republican attacks, should Trump regain the White House.
While both groups have opposed stricter environmental rules, the Inflation Reduction Act contains some provisions the corporate interest groups like, including massive tax breaks for manufacturing and green energy technologies. "Oil companies in particular have expressed interest in potential business opportunities offered by the climate law, such as projects that would produce hydrogen fuel and capture and store carbon dioxide," Brugger writes.
Mike Sommers, president and CEO of the American Petroleum Institute, said partisanship will not get in the way of policies the industry supports. "We’ll work vigorously to ensure that the provisions that we support in the IRA sustain during a potential Trump administration," he told Politico. "This has always been a bipartisan organization. The industry is bipartisan."
Still, there is much in the Biden environmental agenda that could be swept away in the event of a Trump victory. Republicans have grown increasingly hostile to electric cars, which have received a variety of subsidies in the Biden legislation, and Trump has long spoken of his strong dislike for wind power.
On the other hand, it’s not clear how much power corporate interest groups will have, or exactly what environmental policies a new Trump administration would pursue. Tom Pyle, a former oil industry lobbyist who leads the American Energy Alliance, said there is still enormous uncertainty about the possible change of the guard in the White House. "It’s Donald Trump — you never really know," he told Politico.
Whistleblower Accuses the IRS of Failing to Police a Tax Break for the Rich: Report
A whistleblower from inside the Internal Revenue Service reportedly alleges that the agency has failed to properly police abuses of a lucrative tax break intended to lure wealthy Americans to move to Puerto Rico.
Jesse Drucker reports at The New York Times:
Amid concerns that a 2012 law is enabling tax evasion by the wealthy, an investigation is reportedly underway in the Senate, but IRS Commissioner Danny Werfel tells the Times that the agency’s enforcement efforts in Puerto Rico are being ramped up as a result of funding the agency received as part of the 2022 Inflation Reduction Act.
Quote of the Day
"If we don’t hit any speed bumps, it could work. But we usually hit speed bumps."
Republican Rep. Andy Harris of Maryland, quoted at The Hill in a piece noting that some GOPers are already dialing down expectations that they may be able to pass 12 annual appropriations bills for fiscal 2025 on an aggressive schedule laid out by party leaders. That timetable aims to have the work done before lawmakers’ August recess.
The prolonged appropriations process for 2024 was marked by repeated rounds of Republican infighting over spending levels and culture war policy items. Harris, who chairs the Appropriations subcommittee on agriculture, rural development and the Food and Drug Administration, told The Hill that this year’s process "won’t be any easier."
Other Republicans indicated that getting the bills through the Appropriations panel will be easier passing them through the full House, where hardline conservatives last year blocked some bills by tanking procedural rules votes. "Inherently, there were some challenges there that we’re going to have to overcome," Republican Rep. Chuck Fleischmann of Tennessee told The Hill.
Charts of the Day: Inflation
The chart below, from Axios, pretty much speaks for itself, but we’ll point out that it does a good job of summarizing some troubling economic data for President Joe Biden — and for just about anyone in the country who eats. The good news: The inflation rate for "food at home" is a miniscule 1.1% over the last year. The bad news, as Axios’s Emily Peck writes: "[S]ince January 2021, when President Biden took office, prices are up nearly 21%." And the cost of dining out isn’t any better, having risen 4.1% over the last year and about 22% since 2021.
Fiscal News Roundup
- Republicans’ $4 Trillion Question: Should They Pay for Extending Trump Tax Cuts? – Wall Street Journal
- GOP Tempers Expectations on Appropriations Bills – The Hill
- White House to Unveil 'Unprecedented' 21-State Initiative to Modernize U.S. Power Grid – UPI
- How a Simple Fix Could Double the Size of the U.S. Electricity Grid – Washington Post
- Treasury Yields Spike After Pair of Weak US Sales – Bloomberg
- US Consumer Confidence Rises for First Time in Four Months – Bloomberg
- Wall Street’s Favorite Recession Indicator Is in a Slump of Its Own – Wall Street Journal
- Trump Endorses GOP Challenger to Freedom Caucus Leader – Politico
- Cancer Is Capsizing Americans’ Finances. ‘I Was Losing Everything’ – Wall Street Journal
Views and Analysis
- The Support Our Public Services Briefly Had—and Still Need – Robert Kuttner, American Prospect
- Nearly Everything Americans Believe About the Economy Is Wrong – Catherine Rampell, Washington Post
- America’s Best Decade, According to Data – Andrew Van Dam, Washington Post
- Biden Doesn’t Want You Buying an E.V. From China. Here’s Why – Jim Tankersley, New York Times
- Biden’s EV Tariffs Will Delay an Essential Transition – Bloomberg Editorial Board
- Skyrocketing Rents and Home Prices May Be Pivotal in the 2024 Election – Leigh Ann Caldwell, Washington Post
- Even Biden’s Most Reliable Voters Can’t Get Past the Economy – Douglas E. Schoen and Saul Mangel, The Hill
- No, Americans Are Not Completely Stupid About Inflation – Peter Coy, New York Times
- ‘It Was Pure Retaliation’: The Feud That Will Define the Senate GOP – Ryan Lizza, Politico
- Covid Will Still Be Here This Summer. Will Anyone Care? – Fenit Nirappil and Sabrina Malhi, Washington Post