Happy Thursday! Vice President Kamala Harris and former President Donald Trump hit the campaign trail today. Harris is looking to build on her debate victory Tuesday night with a pair of rallies in North Carolina, where her campaign unveiled a new slogan, “A new way forward,” meant to draw a contrast with Trump and emphasize that her focus is on the future. “Her campaign is riding high, but still sees the race as an exceedingly close grind,” The New York Times reported. Harris’s post-debate fundraising haul of $47 million in 24 hours will undoubtedly help through that grind.
Trump, meanwhile, held an event in Tucson, Arizona, focused on the economy. In a post on social media, he insisted he had won his showdown against Harris and said “THERE WILL BE NO THIRD DEBATE!” His campaign issued a memo saying that its own post-debate survey of 1,893 likely voters across seven battleground states found that support for Harris remained flat — and that Trump saw a two-point bump. “Clearly, target state voters were not impressed by Kamala Harris’ empty platitudes and while the media would have people believe she is cruising to victory, this couldn’t be farther from the truth,” the Trump campaign pollsters wrote.
Here’s what else is happening while we wait for more polling to shed light on the state of the race and whether the debate changed anything.
Jeffries Rejects GOP Funding Plan
House Minority Leader Hakeem Jeffries said Thursday that Democrats would reject Republican leadership’s plan to avoid a government shutdown at the end of the month, calling it “unserious and unacceptable.” The Democratic leader called on moderate Republicans to work in a bipartisan fashion to pass a short-term funding bill that would keep federal agencies open.
House Speaker Mike Johnson’s plan would fund the government for six months and would include the SAVE Act, which requires proof of citizenship from people registering to vote. But that proposal has gone over like a lead balloon, and Johnson yesterday postponed a scheduled vote on it in the face of mounting opposition from his own members. Some conservatives oppose the spending levels in the bills, and some oppose all stopgap spending bills. Defense hawks also object to the Johnson bill, warning that a six-month extension of current funding would undermine the military.
“Johnson’s detractors are aplenty — especially inside the House Republican leadership, where the speaker’s seemingly earnest determination is being met quietly with sneers, jeers and head shaking,” Punchbowl News reported.
Former President Donald Trump has likely complicated Johnson’s job by insisting that Congress should approve the Republican voting measure as part of any funding deal and urging GOP lawmakers to allow a shutdown otherwise. Trump’s running mate, Sen. JD Vance, suggested in a podcast interview yesterday that Republicans might benefit from picking this fight and threatening a shutdown. “Why shouldn’t we be trying to force this government shutdown fight to get something out of it that’s good for the American people?" he said. "Like, why have a government if it’s not a functioning government?”
With some 18 days to go before the deadline, the path forward on a stopgap spending bill remains uncertain, and Jeffries pinned the uncertainty on far-right Republicans.
“Extreme MAGA Republicans want to shut down the government because they are determined to jam Trump’s Project 2025 down the throats of the American people and enact extreme cuts to veterans, Social Security, and to disaster relief in a manner that will hurt the American people,” he said during a weekly press briefing. “We are simply asking traditional Republicans to partner with House Democrats in a bipartisan way to avoid a Donald Trump-inspired extreme MAGA Republican shutdown. That’s not too much to ask,” Jeffries said, adding that the framework for a deal already exists under the Fiscal Responsibility Act of 2023, which set federal spending levels for fiscal years 2024 and 2025.
Democrats object to pushing off the 2025 spending bills into next year. “We want to get it resolved this calendar year, because that’s the only practical way to meet the needs of the American people,” Jeffries said, citing various funding levels that Democrats want to see adjusted.
Asked if some in his party might accept a shorter-term spending bill that included the SAVE Act, Jeffries said Democrats “have zero interest in enacting any part of Trump’s Project 2025 agenda.”
He again insisted that bipartisanship was the only way forward: “I’m hopeful that House Republican leadership and traditional Republicans will reach that conclusion sooner rather than later so we can get that job done.”
Biden Administration Rolls Out New Rules for Minimum Corporate Tax
The Treasury Department on Thursday released a draft of new rules detailing the corporate alternative minimum tax that was signed into law as part of the 2022 Inflation Reduction Act. Intended to make it more difficult for large, profitable companies to pay little or nothing to the IRS, the 15% minimum tax will apply to roughly 100 large firms that report more than $1 billion in profits.
The proposed rules, which The Washington Post’s Tony Romm and Julie Zauzmer Weil described as an “extraordinarily technical, roughly 600-page blueprint,” have been in the works for nearly two years, highlighting just how difficult the corporate alternative minimum tax, or CAMT, could be to define and enforce.
Under current rules, corporations are supposed to pay a top rate of 21% on their profits, but the aggressive use of deductions and credits can whittle their payments down to far less, and sometimes even zero. The CAMT aims to correct that problem by requiring companies to pay at least 15% on the profits they report to shareholders, which are typically larger than the post-deduction numbers reported to the IRS.
The Treasury Department said Thursday that the CAMT will significantly increase the tax burden on large, profitable businesses, raising an estimated $250 billion over 10 years. “These corporations would have otherwise paid an average effective federal tax rate of 2.6%,” Treasury said in a statement. “An estimated 60% of CAMT payers would otherwise have paid an effective tax rate of less than 1%, including 25% of payers that would have paid an effective tax rate of zero.”
Deputy Treasury Secretary Wally Adeyemo told The Wall Street Journal that the tax was a matter of fairness. “The ability to use accountants and lawyers to reduce tax bills down to zero gives billion-dollar corporations a competitive advantage over smaller businesses,” he said.
News rules, same old problem? Some experts worry that the new rules will fail to achieve the goal of a true minimum tax because so many tax breaks remain in place.
“The bill was predicated on what our legislators call loopholes in our tax laws and solving this problem, and then we add in all these adjustments that are essentially the same thing we already had,” Jeff Hoopes, an accounting and public policy professor at the University of North Carolina, told The New York Times. “A lot of companies will still pay less than 15 percent.”
The proposed rules won’t fully take effect until next year, although some companies have started to apply their own interpretations of them. A hearing on the final rules is scheduled for January, meaning that a new administration will be in charge no matter how the rules are received. Republicans in Congress have introduced legislation to eliminate the minimum tax, raising the possibility that, depending on the election results, the rules may never take effect.
Fiscal News Roundup
- Jeffries: Dems to Reject Trump-Backed Policy Provisions in CR – The Hill
- Johnson Faces GOP Ire After Conservative Spending Plan Blows Up – Politico
- JD Vance Says GOP Should Threaten a Shutdown: 'Why Have a Government if It’s Not a Functioning Government?' – NBC News
- Biden Administration Releases Plans for New Minimum Tax on Large Companies – Washington Post
- A Corporate Minimum Tax Aimed at Closing ‘Loopholes’ Leaves Gaps – New York Times
- Trump Says He Had a Great Debate. His Allies Privately Say Otherwise – New York Times
- Trump Says He Will Not Debate Harris Again – Politico
- Harris Widens Lead Over Trump in Postdebate Poll – The Hill
- GOP Pollster Frank Luntz: Debate Will Cost Trump the Election – The Hill
- Young Women Are More Liberal Than They’ve Been in Decades, a Gallup Analysis Finds – Associated Press
- US Bans Navient From Servicing Federal Student Loans – CNN
- USPS’ Long-Awaited New Mail Truck Makes Its Debut to Rave Reviews From Carriers – Associated Press
- Britain’s State-Funded Health System Must ‘Reform or Die,’ Prime Minister Says – Associated Press
Views and Analysis
- Harris Can Win on the Economy, but She Needs a Stronger Message – Jedediah Britton-Purdy, New York Times
- Congressional Republicans Try to Hide From Trump’s Debate Performance – Paul Kane, Washington Post
- Trump Is Drowning in the Misinformation Swamp He Helped Create – Allison Morrow, CNN
- Trump’s Slow-Burn Authoritarianism – Greg Sargent, New Republic
- Trump’s GOP Is a Shadow of Its Former Self – Timothy L. O’Brien, Bloomberg
- What Harris Shouldn’t Say About the Economy – Paul Krugman, New York Times
- Harris’ Debate Victory Could Be Unlike Any Other – Michael A. Cohen, MSNBC
- Post-Debate, the Optimum 2024 Political Outcome Comes Into View – George F. Will, Washington Post
- You Are Way Better Off Than You Were Four Years Ago – Timothy Noah, New Republic
- Why You Should Feel Good About the American Economy – Courtenay Brown, Axios
- Forget Repeal and Replace. The Next Big ACA Fight Will Be Over Subsidies – Julie Appleby and Sabrina Malhi, Washington Post
- The Fed’s Rate-Cut Dilemma: Start Big or Small? – Nick Timiraos, Wall Street Journal
- Welfare Is What’s Eating the Budget – Former Sen. Phil Gramm (R-TX) and Rep. Jodey Arrington (R-TX), Wall Street Journal
- COBOLing Together UI Benefits: How Delays in Fiscal Stabilizers Affect Aggregate Consumption – Michael Navarrete, Brookings Institution