with Paulina Firozi
Hours after making noisy shows of their disgust with President Trump, Sens. Jeff Flake (R-Ariz.) and Bob Corker (R-Tenn.) voted with 48 fellow Republican senators to send him a measure thwarting the ability of consumers to sue their banks and credit card companies. Vice President Pence, in the Senate at 10:11 p.m. Tuesday, cast his fifth tie-breaking vote of the year to ensure it reaches Trump’s desk, where the president is expected to sign it.
The development should reassure those nervous that the bitter and increasingly public breach between Trump and members of his party on Capitol Hill spells doom for the tax overhaul they hope to tackle by the end of the year.
No doubt, the odds remained stacked against such a daunting task in so compressed a timeframe. And the discord doesn’t help.
Corker’s morning tirade against the president and Flake’s retirement announcement — in which he denounced Trump’s corrupting influence on the party and the nation — bracketed a midday visit to the Capitol by Trump to rally the troops on his tax agenda. The message that GOP leaders hoped to send, that the White House and congressional Republicans are working in lockstep, was swamped by the intramural sniping.
And as my colleagues Sean Sullivan and Elise Viebeck reported, not much was said about taxes anyway: “'It wasn’t a whole lot about taxes,'” said Sen. John Cornyn (R-Tex.), the second-ranking Republican. “;It was about the record in the last nine months and the successes in terms of the regulatory environment, consumer confidence, the stock market, and also the need to get the work done.'”
But later, after the Capitol emptied of an unusually large media contingent on hand for the president’s cameo, Republicans came together to gut the Consumer Financial Protection Bureau rule that bars financial giants from slipping binding arbitration clauses into customer contracts. Two Republicans broke ranks: Sens. Lindsey Graham (S.C.) and John Kennedy (La.). Among those voting in favor: Sen. John McCain (R-Ariz.), who with Corker and now Flake forms a rump group of outspoken Trump detractors.
See some of Corker's comments from yesterday morning here:
The victory for the GOP, and the industry, points in the tax agenda’s favor: For all the headline-grabbing disputes within the party over both substance and style, a common set of driving interests still stitches together the GOP’s ruling class. And none more so than a belief in cutting taxes.
Flake, for example, fits squarely within the conservative mainstream in that regard — even though, as my colleagues Ed O’Keefe and Dave Weigel write, he’s earned something of a maverick reputation for otherwise opposing deficit spending:
Long before the rise of Trump, Flake was seen as one of the GOP’s stalwart conservatives, a relentless but cheerful opponent of wasteful spending — and a critic of his party when he thought it was breaking the bank. He opposed the Medicare prescription drug law, a major priority of President George W. Bush’s administration, and criticized the party for increasing the national debt.
“Republicans have adopted the belief or the principle that you spend money to get elected,” Flake told the libertarian magazine Reason in a 2006 interview, shortly before his party lost control of the House and Senate. “Staying in office, staying in power, has come to overwhelm everything.”
In 2007, Flake was removed from a plum spot on the House Judiciary Committee, a move interpreted as intraparty revenge for his criticism. But by 2011, Flake had succeeded in one of his long-held goals, banning “earmarks,” which members of Congress used to secure spending for projects in their districts.
Watch highlights of Flake's floor speech announcing his retirement here:
But as a House member in Bush’s first term, Flake voted for both the 2001 and 2003 tax cuts, which cost $1.6 trillion over ten years. He voted to extend them; he’s supported cuts that favor the wealthy, including lower rates on capital gains and dividends and ending the estate tax; and he has sent encouraging signals in recent days about the party’s latest bid to overhaul the code.
Corker, while bashing the president on Tuesday as a danger to the world, also suggested he’s a danger to the Republican tax project. “Hopefully the White House will step aside and let that occur in a normal process,” Corker said in an appearance on NBC’s “Today Show,” sounding less like a quisling bent on sabotaging Trump’s top domestic priority and more like a concerned minder of it (House Speaker Paul Ryan (R-Wis.), for what it's worth, predicts Corker will be a supporter). And McCain last week responded angrily when a Fox News reporter suggested he'd place personal pique ahead of considering legislation on the merits.
Watch it here:
Amid the commotion, there was a quiet reminder of a graver challenge facing congressional tax-writers — balancing competing claims among GOP rank-and-file as a proposed rewrite of the code creates new winners and losers. My colleagues Damian Paletta and Mike DeBonis report party leaders are scrambling to head off a rebellion by blue-state Republicans over a proposal to end the deduction for state and local taxes:
“This would have a disproportionately negative impact on taxpayers in states such as New York, New Jersey, Illinois and other states where taxes are high and taxpayers can save large amounts of money from the deduction.
Several Republicans in those states have signaled to GOP leaders in recent days that they won’t support a House budget resolution on Thursday unless they can have assurances about the potential impact of the tax plan. Passage of the budget resolution is vital if Republicans want to eventually pass a tax-cut package without support from Democrats… The Republican margin for error on the budget resolution is razor thin. An initial version of the budget resolution passed this month by a vote of 219 to 207, and 218 votes are needed to ensure passage.”
Trump, as he did Tuesday, may come and go. But Republicans still want to remake the tax code and remain in the congressional majority come 2019.
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— The final rose. From me: Trump "conducted an informal poll of Senate Republicans to solicit their views on the finalists he is considering to chair the Federal Reserve. The show-of-hands survey, which Trump asked for during a closed-door lunch meeting Tuesday at the Capitol, pitted Federal Reserve governor Jerome Powell against Stanford University economist John Taylor, participants said. The president also asked about Janet L. Yellen, the current Fed chair, whose four-year term ends in February.
The poll did not appear to return a clear result, though Sen. Tim Scott (R-S.C.) told Bloomberg that he thinks Taylor won. Not everybody voted. Sen. Mike Rounds (R-S.D.), a member of the Senate Banking Committee, said he has no strong preference so he didn’t participate. And Sen. Susan Collins (R-Maine) said she is not familiar enough with Powell and Taylor yet to have a view. 'I think Janet L. Yellen has done a good job and hope that she might be considered for reappointment,' Collins said."
— Sizing them up. NYT's Binyamin Appelbaum compares Powell, "the status quo candidate," to Taylor, "by many conservative Republicans for his insistence that the economy would produce stronger growth if the Fed would just get out of the way... Picking Mr. Powell could allow Mr. Trump to install a Republican Fed chairman without significantly altering monetary policy. Mr. Trump prizes the fact that the economy is growing and the unemployment rate has fallen to 4.2 percent... But some Republicans in Congress and some of Mr. Trump’s advisers, including Vice President Mike Pence, want to overhaul the central bank, beginning right at the top."
— Readying the rollout. Republicans are working to ensure they avoid the mistakes of their last legislative flop, on an Obamacare repeal. Politico's Rachael Bade: "House Ways and Means Chairman Kevin Brady (R-Tex.) and the Republican whip team have been hosting policy 'deep dives' to get the often divided conference on board. GOP leaders have brought in TV pundit and campaign strategist Kevin Madden to help lawmakers sharpen their talking points. And House Republican Conference Chair Cathy McMorris Rodgers of Washington, who leads the House GOP's messaging arm, is preparing rollout plans that include a texting campaign and multistate tax tour. She has also nearly doubled the number of media and digital strategy aides on her staff."
— Dems: Failure will flip House. Politico's Heather Caygle and Aaron Lorenzo: "House Democrats have spent weeks publicly lambasting Republicans for trying to muscle through a partisan tax overhaul. But privately, Democratic leaders have no intention of engaging with Republicans even if they offered, sources close to them say. House Minority Leader Nancy Pelosi (D-Calif.) is convinced another GOP crash-and-burn would likely hand Democrats the House next year, so there’s no political upside to playing ball. 'You will be in the majority' if Republicans continue to stumble, Pelosi said during a closed-door caucus meeting on Tuesday, according to sources in the room. Democrats need to pick up 24 seats to take back the House and many Democratic challengers are already outraising Republican incumbents, putting the chamber in play."
— Deficits, schmeficits. "House conservatives have warned for years about the threat posed by the national debt, and for months they pushed to include a path to ambitious spending cuts in budget legislation," Mike DeBonis writes. "On Thursday, most of them plan to vote for a Senate-written budget that not only fails to make way for spending cuts but also explicitly envisions adding up to $1.5 trillion to the existing $20 trillion national debt to accommodate a tax overhaul. GOP hard-liners have frequently been willing to oppose must-pass legislation to achieve conservative policy goals, threatening government shutdowns and federal default as leverage. But numerous House conservatives said in interviews this week that this time is different: Republicans are under enormous pressure to pass a tax bill, given the party’s failure to take legislative action on health care, and they do not want to be seen as standing in the way."
— Schumer: Trump may need Dems. The Senate Minority Leader tells Politico's Ben White: “'If this bill fails, what we saw in health care in a small way, we could see in a bigger way and actually come up with some kind of bipartisan compromise' he said. That compromise would have to include no tax breaks for the top 1 percent and deficit neutrality. If that happens, Schumer said, 'there are a lot of Democrats who would be willing to reduce the corporate rate.' Schumer also took sharp aim during the interview at Treasury Secretary Steven Mnuchin, calling him a liar and a 'suck-up' to Trump. 'I don’t know if the man’s deliberately lying, but it seems so,' Schumer said, referring to Mnuchin’s earlier remarks to POLITICO about the potential impact of tax cuts on the deficit. 'His statements are outlandish, and he seems just to want to — I don’t know if I’m allowed to use this word; I think I am — suck up to Trump.'"
— Close to home. Bloomberg's John McCormick and Joe Light report the plan could pinch some of Ryan's constituents in an upscale enclave: "On the shores of the 5,400-acre lake, once a hideout for Chicago mobster George "Bugs" Moran, multimillion-dollar homes have replaced many of the quaint cottages that once dotted the area. Annual property tax bills on waterfront properties along North Lake Shore Drive range from about $21,000 to $71,000, local real estate records show. For most homeowners in the heavily Republican area, however, those costs are eased by their ability to write off state and local taxes on federal returns... But enclaves of upper-middle income homeowners like Geneva Lake are the Achilles heel of the GOP tax plan, said Moody’s Analytics Chief Economist Mark Zandi. While low-income and high-income households are likely to get a tax break from the GOP plan, upper-middle-income professionals could come out as losers, he said."
— $2 million ad blitz. The Hill's Naomi Jagoda: "The American Action Network on Tuesday announced that it's spending $2 million on a television ad buy promoting the GOP's tax-reform plan ahead of an expected House vote later in the week on a budget resolution that would advance it. The ad features a Wisconsin woman saying the tax plan would help middle-class families. It is slated to run in 32 congressional districts, including many held by GOP lawmakers whose districts are being targeted by Democrats in next year's midterm elections."
— Ross vs. the estate tax. Bloomberg: "It wasn’t quite Hamlet’s soliloquy on mortality, but Commerce Secretary Wilbur Ross got philosophical in his opposition to the federal estate tax the Trump administration wants to repeal. 'It’s bad enough that you have to die,' Ross, 79, said Tuesday in an interview on Bloomberg Television. 'You shouldn’t be fined for doing so.'"
— NAFTA lobby wars. NYT's Ana Swanson and Natalie Kitroeff: "Automakers, retailers and other business leaders stormed Capitol Hill on Tuesday in an extraordinary show of force against a Republican president they fear will cripple or kill the North American Free Trade Agreement, an outcome business leaders said could devastate their profits and harm the United States’ ability to compete in a global market. More than 130 representatives from an array of industries met with senators on Tuesday to ratchet up pressure on lawmakers — many of whose constituents work for companies dependent on Nafta — to keep the deal intact."
— Clinton camp, DNC paid for dossier. The Post's Adam Entous, Devlin Barrett and Rosalind S. Helderman scoop: "The Hillary Clinton campaign and the Democratic National Committee helped fund research that resulted in a now-famous dossier containing allegations about President Trump’s connections to Russia and possible coordination between his campaign and the Kremlin, people familiar with the matter said.
Marc E. Elias, a lawyer representing the Clinton campaign and the DNC, retained Fusion GPS, a Washington firm, to conduct the research. After that, Fusion GPS hired dossier author Christopher Steele, a former British intelligence officer with ties to the FBI and the U.S. intelligence community, according to those people, who spoke on the condition of anonymity. Elias and his law firm, Perkins Coie, retained the company in April 2016 on behalf of the Clinton campaign and the DNC. Before that agreement, Fusion GPS’s research into Trump was funded by an unknown Republican client during the GOP primary."
Trump defenders are attempting to spin this revelation as somehow exculpatory. But it's hardly surprising that Trump's general election opponent paid to dig up dirt on him — that happens in campaigns up and down the ballot, all across the map, all the time. In this case, the Democrats only picked up the work from an as yet unnamed Republican donor. What continues to matter is how much of the document special counsel Robert Mueller finds to be both true and relevant to the case he's building.
Meanwhile, House investigators want Fusion's bank records, and the firm is asking a federal judge to block their release, Politico reports.
— Trump lawyer faces questions. The Post's Karoun Demirjian: "Michael Cohen, President Trump’s personal lawyer and a former lawyer for his business, met with the House Intelligence Committee for almost six hours Tuesday in what one committee Democrat called a “contentious” exchange. The committee also met for several hours with Trump’s former campaign digital director, Brad Parscale, who said in a CBS interview earlier this month that Trump won the election through use of Facebook advertising. That meeting comes just one week before House and Senate investigators are expected to speak with Facebook, Twitter and Google executives, in back-to-back public hearings on Nov. 1 to investigate how Russia used social media to try to influence the election."
— Twitter adds ad transparency. The Post's Elizabeth Dwoskin and Brian Fung: "Amid federal investigations into Russian meddling in the U.S. election, Twitter is making all of its ads public, along with who published them and how much was spent, the company said Tuesday. The move, which follows a similar decision by Facebook, is aimed at adding greater transparency to the largely opaque world of online political advertising. It also may offer some cover for Silicon Valley companies that have come under scrutiny over the role they unwittingly played in allowing a massive Russian disinformation campaign to spread on their platforms."
- The Hill hosts an event on the future of housing with HUD Secretary Ben Carson.
- Cato Institute holds an event on renegotiating NAFTA on Thursday.
- Cato Institute holds an event featuring Grover Norquist titled, “Home Stretch for Major Tax Reform?” on Thursday.
- The Senate Banking, Housing, & Urban Affairs Committee holds a nomination hearing Thursday for Brian D. Montgomery to be HUD’s assistant secretary for Housing – Federal Housing Commissioner, Robert Hunter Kurtz to be HUD’s assistant secretary for Public and Indian Housing, and Suzanne Israel Tufts to be HUD’s assistant secretary for Administration.
- The Information Technology and Innovation Foundation holds a panel discussion about the policy debate around competition policy in innovation industries on Thursday.
- Heritage Foundation holds an event on “The Role of Investor-State Dispute Settlement Provisions in NAFTA” on Friday.
Sen. Jeff Flake (R-Ariz.) speaks to reporters after announcing plan to retire:
Flake joins growing list of GOP lawmakers on their way out:
Here are the twists and turns of the Trump-Corker feud:
Former FBI chief James B. Comey’s secret Twitter, according to the Internet:
On the Late Show with Stephen Colbert, Jake Tapper responds to a recent Twitter insult from Bill O'Reilly: