POLITICO NIGHTLY: What’s behind Biden’s Door No. 2?

 

BY ELANA SCHOR Presented by Gilead Sciences, Inc. With help from Joanne Kenen and Margy Slattery THE INFRASTRUCTURE DOUBLE PLAY — President Joe Biden’s infrastructure plan — which his party is touting as a massive boost to the U.S. economy writ large, beyond mere roads and bridges — is 19 days old, worth more than $2 trillion and only half outlined. The portion of the plan that the White House has christened the “American Jobs Plan” consists of proposals for broadband, clean water, transit and more. While it sits before Congress, it’s already sparked a lobbying bonanza and jostling among Democrats over how seriously to court GOP votes. The details of the second half — dubbed the “American Families Plan” and focused on child care, education and other home-centric priorities — are still under wraps. The second half is likely to emerge any day now as Biden prepares for his first address to Congress on April 28. But its delayed release complicates matters for congressional Democrats as they weigh how to push forward the president’s proposal. Should it be two bills along the lines of what Biden has started to outline, two bills with somewhat different structures, one massive measure that encompasses as much of Biden’s plan as possible, or an as-yet-unknown approach? Earlier this afternoon, the president held his second bipartisan meeting in two weeks with lawmakers he’s hoping to woo for his half-released plan. Democratic leaders already are setting unofficial benchmarks for bipartisanship and vetting different pathways to shepherd the entire package through the minefield-laden grounds of Congress. Republicans, meanwhile, have coalesced around a strategy of pushing back on the idea that the wide-ranging proposal really qualifies as infrastructure. All of this action has come without the second portion of Biden’s proposal clearly visible, and while the White House is reportedly eyeing tax increases for higher-income individuals — a red flag for Republicans — as an option to pay for the “families” portion of the plan. President Joe Biden speaks during a meeting with a bipartisan group of members of Congress to discuss investments in the American Jobs Plan in the Oval Office at the White House. | Getty Images It’s quite possible that by the time lawmakers hear about the “Families Plan,” they already will have settled on their own legislative strategies to steer some of its major provisions into law. House Ways and Means Chair Richard Neal (D-Mass.), for example, promised a full two weeks ago to make universal paid leave part of any infrastructure legislation his committee produces ( as Nightly first reported). Statements like Neal’s could portend a harder fight to fit other potential elements of Biden’s families agenda into whatever legislative vehicle(s) Democrats decide to use, as they weigh what’s possible with their razor-thin majorities. As much as Biden’s party wants to get its entire priority list into whatever bill gets written this spring, the reality is that some ideas will have to fall by the wayside. That’s not to mention the near certainty that pitching a tax increase on wealthy individuals will prove even more politically challenging for the White House than the 28 percent corporate tax rate Biden proposed 19 days ago — which Sen. Joe Manchin (D-W.Va.) has already cooled to. The White House has remained consistent in its depiction of its infrastructure proposal as two pillars of one plan , though press secretary Jen Psaki subtly alluded to the complexity in an April 1 preview of the second portion. Biden “will be speaking more in the coming weeks about how we can do more to help our caregivers, to help our — well, some of that was in this [first] package — but help address the needs of child care,” Psaki told reporters that day. While it’s too soon to say that Biden might have erred by waiting this long to release the second part of his plan, the confusion so far suggests he has a lot of work ahead of him. After all, one of the president’s top congressional allies already has suggested that Democrats split Biden’s proposal into two bills ... when the second part isn’t even public yet. Welcome to POLITICO Nightly. Reach out with news, tips and ideas for us at eschor@politico.com and rrayasam@politico.com, or on Twitter at @eschor and @renurayasam. A message from Gilead Sciences, Inc.: Known to keep pushing. Decades of discovery lie behind every breakthrough. From HIV to viral hepatitis to today’s battle with COVID-19, Gilead scientists have been pushing boundaries for over 30 years. So that we can bring tomorrow’s life-changing therapies forward today. To know more, visit Gilead.com.   FIRST IN NIGHTLY ‘PLAYING WITH MATCHES WHILE WRECKING THE FIRE DEPARTMENT’ — The last time the Justice Department challenged a bank merger was in 1985, around the time that compact discs and New Coke debuted. In the 36 years since, the United States has shed roughly 10,000 banks — some from bank failures, but most through acquisitions that banking regulators and antitrust prosecutors at the Justice Department have blessed. Critics say that has led to higher fees for consumers, reduced access to banking services and increased concerns about systemic risk to the banking system. Now, as Democrats in Congress push for an antitrust overhaul to restrain corporate power in tech, health care and agriculture, progressive lawmakers and economists also want the Biden administration to crack down on mergers in the banking sector, Leah Nylen writes. It’s setting up a clash with the banking industry, which has been lobbying for even less merger scrutiny. The issue is taking on greater urgency as some of the country’s biggest regional banks — PNC of Pittsburgh, Huntington Bank of Columbus, Ohio and M&T Bank of Buffalo, N.Y. — pursue major deals. “Bank regulators are playing with matches while wrecking the fire department,” said Senate Banking Chair Sherrod Brown (D-Ohio). “The Wall Street megabanks are so large and powerful that banks across the country feel pressured to get bigger and riskier. These mergers are a symptom of a bigger problem — deregulation has left us with Wall Street banks that are too big and that take too many risks.”   STEP INSIDE THE WEST WING : The Biden administration is quickly approaching 100 days in office — has it delivered on its early promises? What tactics and strategies are being debated in West Wing offices? What’s really being talked about behind the scenes in negotiations with Congress on the infrastructure plan? Add Transition Playbook to your daily reads for details that you won’t find anywhere else that reveal what’s really happening inside the West Wing and across the executive branch. Track the people, policies and power centers of the Biden administration. Subscribe today.     WHAT'D I MISS? — Pelosi defends Waters over her ‘get more confrontational’ remark to protesters: House Speaker Nancy Pelosi came to Rep. Maxine Waters’ defense after criticism of remarks Waters made over the weekend in Minnesota that Republican lawmakers said stoked further violence. “No, absolutely not,” Pelosi said in response to a question about whether Waters (D-Calif.) incited violence with her comments. Pelosi added that there was no need for Waters to apologize. House Minority Leader Kevin McCarthy said today that he would introduce a resolution to censure Waters for her comments. Meanwhile, in Minneapolis, the jury began deliberations in the trial of former police officer Derek Chauvin over the death of George Floyd. — Psaki defends administration’s messaging on refugee cap: White House press secretary Jen Psaki tried to rebut criticism of the Biden administration’s refugee admissions plan after its faltering rollout at the end of last week. Biden on Friday signed an emergency presidential decree that would keep in place the 15,000-refugee cap for the current fiscal year set by former President Donald Trump. Immigration advocates and refugee resettlement organizations quickly decried the decision as a betrayal of promises made by Biden to break from Trump’s hard-line policies, and the White House later responded by stating it would unveil an increase to the refugee cap by mid-May at the latest. — CFPB targets debt collectors in bid to protect renters: The Consumer Financial Protection Bureau unveiled a rule cracking down on debt collectors to stop them from forcing renters from their homes during a nationwide eviction ban, as millions of Americans struggle with bills during the pandemic. The new rule requires debt collectors to notify tenants of their rights under the CDC’s moratorium on evictions for nonpayment of rent. The CFPB warned that debt collectors who evict tenants could face prosecution. The agency is issuing the new rule under the Fair Debt Collection Practices Act. — Yellen picks investor as Treasury climate czar, sparking backlash from the left: Treasury Secretary Janet Yellen faced intense criticism from the left after naming a former private equity investor to be the department’s first-ever climate counselor , a high-profile position that will be key to the agency’s sweeping efforts to combat climate change. Yellen’s pick, John Morton, is returning to government after most recently serving as a partner at the climate-focused investment firm Pollination. He earlier worked in the Obama White House as senior director for energy and climate change at the National Security Council, and as a private equity investor with Global Environment Fund. ASK THE AUDIENCE Nightly asks you: A New York Times headline turned viral meme posits that “you can be a different person after the pandemic.” How has the pandemic changed you? Use the form to send your answers , and we’ll include select responses in Friday’s edition.       VAX SCENE BARING HER BICEPS — Another installment in our occasional series about what the Covid immunization drive looks like around the world. Health care editor-at-large Joanne Kenen emails Nightly: Beth Ann Wilmore is director of nursing at Mercy Community Healthcare, which has three centers in a small strip mall in Franklin, Tenn., outside Nashville, and a clinic farther south in Lewisburg. They take all comers — the uninsured, the underinsured, the poor, the poorer. Tennessee is Trump country, and it’s got its fair share of vaccine hesitancy. When Wilmore was offered a coronavirus vaccine early this year, she herself wavered. Like so many other Americans, she wondered if maybe the shots were developed a tad too fast. She wondered if she should hold off just a little while. But she had also seen plenty of Covid and knew what it could do. So she did her vaccine homework. “I learned what it does and doesn’t do in your body,” she said. Then, she rolled up her sleeve and got vaccinated. That experience — her empathetic understanding of the worry, her empirical understanding of the science — has paid off. When she encounters people who are nervous — friends, family, patients — Wilmore can talk them through it, getting them from fear to confidence, even gratitude. This past winter, some on Mercy’s staff were leery about getting their own shots. So Wilmore would walk around the nurses’ station, sharing what she had learned, showing them that she was doing fine. Not everyone got the shot, but over time more and more did. I recently checked back in with Wilmore by email. She said shots are more abundant in her region now, and there’s a pretty good equilibrium between supply and demand. She’s been a bit surprised by how many of the people coming into the clinic for their jabs are older. “Many of these folks have been eligible for a vaccine for a long time, but were more hesitant initially,” Wilmore wrote. She thinks what’s changing their minds is “seeing that people in their community are doing OK after being vaccinated over the last few months.” She does worry that the clinics will hit a wall of hesitancy, but Mercy is trying to stay a step ahead of that, by planning to distribute the vaccine not just at the clinics but at sites out in the community too, “where people feel safe and comfortable,” Wilmore says. She knows the immunization drive has a long way to go, but she’s steadily pushing forward: “I haven’t thought much about herd immunity. I am really focusing on taking care of as many neighbors as I can.” AROUND THE NATION HITTING THE BOOKS, AGAIN — Kids aren’t just months behind in their classes; they’ve also been cut off from a key support system during the pandemic. In the latest POLITICO Dispatch, education editor Delece Smith-Barrow — who sat down with a group of education leaders from across the nation to talk about bold, new ideas for post-pandemic schooling — breaks down how we can get schoolkids back on track. This episode was produced as part of Recovery Lab, a new project from POLITICO about how to recover from the pandemic. Listen to the latest POLITICO Dispatch podcast AROUND THE WORLD SUPER PROBLEMS — The U.K. government will put “everything on the table” to fight the European Super League soccer plan — but is sitting on the sidelines for now. According to London Playbook : “Last night, 12 of Europe’s top football teams — including England’s Arsenal, Chelsea, Liverpool, Manchester City, Manchester United and Tottenham — announced their intention to break away from the existing format of competitive football and form their own elite ‘European Super League.’ The move would restrict entry to outside clubs and have potentially devastating consequences for smaller teams excluded from the set-up, while acting as a huge money-spinning exercise for the largely overseas owners of the Super League sides. Politicians, fans and the rest of world football are already loudly condemning the plan.” British Culture Secretary Oliver Dowden told MPs the proposal was “tone deaf” and against the spirit of the game. “Football is in our national DNA,” he told the House of Commons. “We invented it, we helped export it around the world, and it’s been at the heart of British life for over a century.” He added: “We will not stand by and watch football be cravenly stripped of the things that made millions across the country love it.” While Dowden said the government will launch a fan-led review of the sport, it will hang back for now in the hope that existing football bodies will work out how to block the plan, with government sanctions and other measures under discussion.   SUBSCRIBE TO “THE RECAST” TO JOIN AN IMPORTANT CONVERSATION : Power dynamics are changing in Washington and across the country. More people are demanding a seat at the table, insisting that all politics is personal and not all policy is equitable. Our twice-weekly newsletter “The Recast” breaks down how race and identity shape politics and policy in America, and we are recasting how we report on it. Get fresh insights, scoops and dispatches on this crucial intersection from across the country and hear critical new voices that challenge business as usual. Don’t miss out, SUBSCRIBE . Thank you to our sponsor, Intel.     NIGHTLY NUMBER 15 The number of Senate Republicans who pledged today to uphold their party’s decadelong ban on earmarks, drawing a battle line days before the GOP is set to vote on whether to reinstate the spending practice. PARTING WORDS PLAYING FORTNIGHT — POLITICO Magazine senior editor Margy Slattery emails us: I’ve been thinking lately about the psychic space the Two-Week Window has come to occupy in our minds in the Covid era. In the early days of the pandemic, public health experts told us to quarantine for 14 days any time we thought we were exposed to the virus. When I had even a mild Covid scare — a close encounter with an unmasked neighbor, say — I’d mentally note the date, count 14 days out, limit my interactions even more than usual, and wait for the virus’ incubation period to pass before I could feel at ease again. When I got married this past July, my then-fiancé and I managed to bring together a few close family members for a small, masked ceremony. Despite all the precautions we took, and as lovely as the day was, a little pebble of worry stayed lodged in my mind until two weeks had passed without any of our family members getting sick. Only then did the wedding officially feel like a success; only then did I post a few photos on social media. No one wants to hold a super-spreader event. Now, the Two-Week Window has returned in a new form. A little more than a week ago, I got the Johnson & Johnson vaccine. I expected to have to wait at least two weeks to develop immunity. (Johnson & Johnson actually says you build more immunity over an additional two weeks — yes, that’s two Two-Week Windows.) Then, three days later, the CDC and FDA recommended pausing use of the J&J vaccine after six women who received it developed a rare but serious blood-clot disorder. With nearly 7 million J&J shots in Americans’ arms, I know my chances of being affected are exceedingly slim. Johnson & Johnson says there’s not even enough evidence yet to prove that the vaccine caused the clots. I haven’t experienced any of the symptoms associated with them. Still, all of the affected individuals are women between the ages of 18 and 48. They developed their symptoms between six and 13 days after their vaccines. I’m a 32-year-old woman, and I got the shot on April 10 — which means, yet again, I’m waiting two weeks before I know I’m in the clear. In a weird way, the Two-Week Window actually is a source of comfort, though. Once you hit it, you feel a sense of certainty that things are going to be OK, at least until the next scare. So, for now, I’ll keep measuring out my life in two-week spans. I’m nine days out from my shot, by the way. But who’s counting? A message from Gilead Sciences, Inc.: Decades of discovery lie behind every breakthrough. For more than 30 years, Gilead scientists have been pushing the boundaries of what’s possible. We’ve worked to advance the science that has unlocked therapeutics for HIV, viral hepatitis, and even COVID-19. Today, Gilead therapeutics are at work, effectively providing treatment for millions. But we’re not stopping any time soon. We’re committed to the relentless pursuit of scientific discovery. To keep pushing to the next goal. To bring tomorrow’s life-changing therapies forward today. And then reach farther. To learn more, visit Gilead.com.   Did someone forward this email to you? Sign up here.   Follow us on Twitter Renuka Rayasam @renurayasam Chris Suellentrop @suellentrop Tyler Weyant @tweyant Myah Ward @myahward   FOLLOW US

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RSN: FOCUS: David Sirota and Andrew Perez | Manchin's Tax Move Could Protect Private Equity Donors

 

 

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FOCUS: David Sirota and Andrew Perez | Manchin's Tax Move Could Protect Private Equity Donors

David Sirota and Andrew Perez, The Daily Poster
Excerpt: "Democratic Sen. Joe Manchin on Monday began raising objections to President Biden's legislation to fund infrastructure investments by raising the corporate tax rate to 28 percent."

The senator's move to block Biden's higher corporate tax rate could shield private equity firms whose executives boosted his campaign and bet big on Trump’s tax bill.

emocratic Sen. Joe Manchin on Monday began raising objections to President Biden’s legislation to fund infrastructure investments by raising the corporate tax rate to 28 percent. Derailing the tax hike would be a lucrative gift to both corporate CEOs in general, and to private equity giants whose executives bankrolled the lawmaker’s 2018 campaign and funded a super PAC that boosted his closely contested reelection bid.

On Monday, Manchin discussed Biden’s infrastructure plan with West Virginia MetroNews, and declared: “If I don’t vote to get on it, it’s not going anywhere.”

“As the bill exists today, it needs to be changed,” Manchin said. While Biden’s plan calls for raising the corporate tax rate from 21 percent to 28 percent, Manchin said he believes the corporate tax rate should be closer to 25 percent for the U.S. “to be competitive.”

On Monday, Sen. Ron Wyden, D-Ore., told reporters that the Democratic caucus and the Senate finance committee will work together to set a final corporate tax rate figure. But Manchin’s proposed change would have a huge impact on how the Biden infrastructure plan is paid for, while largely preserving a tax policy that is delivering a disproportionately huge windfall to a tiny handful of executives at major corporations.

Last month, The Daily Poster reported on a recent study by Grinnell College economist Eric Ohrn showing that for every dollar that publicly traded firms reap from corporate tax cuts, “compensation of the firm’s top five highest paid executives increases by 15 to 19 cents.” That study preceded last week’s revelations that 55 publicly traded corporations paid zero corporate taxes last year.

Manchin’s move could also particularly benefit private equity firms that have converted from partnership structures to C Corporations to take advantage of President Donald Trump’s tax law, which dropped the corporate tax rate from 35 percent to 21 percent.

Such conversions allow private equity firms to attract capital from a wider array of institutional investors who may not have been permitted to invest in partnerships. But private equity firms had not converted until a lower corporate tax rate made the switch even more profitable. The conversions are effectively permanent.

Ares Management was the first private equity giant to convert from a partnership structure to a C Corporation. The firm’s executives were together among his top donors during his 2018 reelection bid. In all, they funneled more than $21,000 to his reelection campaign that year, according to federal records reviewed by The Daily Poster.

Data compiled by OpenSecrets show that was part of more than $212,000 that the private equity and investment industry delivered to Manchin during an election cycle in which he was given a “small business investment” award by a major private equity group that has been lobbying on tax issues.

The Blackstone Group and the Carlyle Group have also converted from partnerships to C Corporations. Executives from those firms donated $4.4 million to Senate Democrats’ super PAC, Senate Majority PAC, during the last two election cycles, including $1.3 million in 2018 when Manchin was reelected with the group’s support.

Changing the tax rates now could eat into these private equity firms’ profits. Ares, Blackstone, and Carlyle have all recently lobbied on federal tax issues, according to the most recent federal disclosures.

While Manchin has been fighting to keep the corporate tax rate low, Ares has been explicitly warning investors that “any substantial changes in domestic or international corporate tax policies, regulations or guidance, enforcement activities or legislative initiatives may adversely affect our business.”

There was initially talk of Biden’s tax plan including provisions to close the so-called private equity tax loophole, but that language was excluded from the initiative.

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IN NEW AD, ANTI-MONOPOLY GROUP HITS REP. RICHIE NEAL OVER BLACKSTONE TIES, CORPORATE TAX CUTS

IN NEW AD, ANTI-MONOPOLY GROUP HITS REP. RICHIE NEAL OVER BLACKSTONE TIES, CORPORATE TAX CUTS

A PROGRESSIVE dark-money group hitting politicians over ties to corporate interests on Monday released an ad against Democratic Rep. Richie Neal of Massachusetts, accusing him of working to maintain President Donald Trump’s corporate tax cuts and highlighting his ties to the private equity firm, Blackstone.

“After Donald Trump cut corporate taxes, one of the wealthiest Wall Street firms, Blackstone, now pays nothing in federal taxes,” the new ad says. “Richie Neal introduced a bill that maintains Trump’s corporate tax cuts. Now, Blackstone is Richie Neal’s top funder. And one of Donald Trump’s too. Corporate power is corrupting Democracy. And Richie Neal is part of the problem.” 

Trump’s 2017 tax bill reduced the top corporate tax rate from 35 to 21 percent. Democrats campaigned on rolling back the cuts, but when Neal, who chairs the powerful House Ways and Means Committee, introduced legislation last summer expanding tax cuts for low-income families, it didn’t touch the corporate tax rate.

Individuals from Blackstone have given $48,600 to Neal’s campaign this cycle, making the company his top contributor so far, out of a total haul of more than $3 million. Individuals from the group started giving to Neal in large amounts in 2019, HuffPost reported

Released by Fight Corporate Monopolies, a political nonprofit founded by the anti-monopoly American Economic Liberties Project, the ad is the second this month going after Neal for his ties to Blackstone. In the first ad, the group criticized him for “protecting Blackstone’s profits” by helping to kill a bill to stop surprise medical billing last year. Neal’s campaign told HuffPost that he introduced his own bill on the issue and that the original bill would have hurt hospitals in his district. The group announced that it would spend a total of $300,000 on TV ads targeting Neal in his district. They spent $150,000 on the first ad buy, which will run for another week, and are putting another $150,000 into the second ad buy, starting Monday. 

Former Bernie Sanders campaign manager Faiz Shakir is consulting for the group, which has so far only spent money on ads about Neal. Shakir said the group intends to focus on other races, such as those for attorney general, state legislative office, and other down-ballot seats, in primaries and in November general elections. (Shakir is married to Sarah Miller, the executive director of the American Economic Liberties Project.)

As a 501(c)(4) nonprofit group, Fight Corporate Monopolies is not required to disclose its donors. Shakir declined to share who its donors are, stating that they have asked to remain anonymous but that a number of progressive foundations have contributed funds. 

Morgan Harper, a Justice Democrats-backed candidate who unsuccessfully challenged Ohio Democratic Rep. Joyce Beatty in April, is a senior adviser to the group. 

“President Trump’s tax cuts did little for Richie Neal’s constituents, but they mean everything to the corporations backing his campaign,” Harper said in a statement. “Neal’s habit of putting corporate profits above people’s needs will only continue if he isn’t held accountable.”

In a statement, Neal’s campaign defended his work on the tax bill and went after Fight Corporate Monopolies, as well as Alex Morse, Neal’s primary challenger. “Fight Corporate Monopolies is a dark money shill for Alex Morse’s campaign, which we know because they have only targeted Richie and never let the truth get in the way of an attack ad,” spokesperson Kate Norton said in a statement. “The Economic Mobility Act is the most significant pro-work, poverty-reducing tax bill in at least a decade, period. This is the latest attempt to distract from Alex Morse’s failed record managing Holyoke.”

Alex Morse, mayor of Holyoke, Massachusetts, who is also backed by Justice Democrats, as well as Indivisible and the Sunrise Movement, is running to unseat Neal in the September 1 primary. His campaign has raised $518,880 so far and is highlighting Neal’s refusal to support Medicare for All or a Green New Deal. Morse has also gone after Neal for dragging his feet on trying to force Trump to release his tax returns, an issue that has drawn criticism from constituents as well. (The Supreme Court sent the issue back down to lower courts earlier this month.) Morse, who is rejecting corporate political action committee money, is also highlighting Neal’s corporate donors. 

Neal is one of a number of powerful Democrats with strong ties to corporate interests and accepted the most corporate campaign money last year, Sludge reported. He has also been one of the Democratic caucus’s most stalwart opponents of Medicare for All. After a historic Rules Committee hearing last April on single-payer legislation, Congressional Progressive Caucus Co-Chair Pramila Jayapal secured a second hearing on the measure last June in front of the more powerful Ways and Means Committee. Ahead of that hearing, Neal urged his colleagues to avoid using the phrase “Medicare for All,” The Intercept reported.

Update: July 13, 2020, 11:59 a.m. ETThis article has been updated to include a statement from Neal’s campaign. 

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