Tag Archives: Upper House

US

Republicans in Strong Position to Retake House as Counting Continues

Leave a comment

WASHINGTON—Republicans remained poised to win control of the House of Representatives with more than a dozen races still uncalled Monday, as Congress returned to work and new members set to take office next year began orientation.

Democrats are projected to hold their Senate majority after a weekend win in Nevada, giving them the 50 seats needed to control the chamber. A final Senate race, in Georgia, is set for a runoff on Dec. 6 because neither candidate got a majority.

In the House, the GOP appeared on track to win the barest of majorities, nonpartisan analysts said. On Sunday night, additional vote tallies in California and Arizona put Republican candidates in striking distance of victory, though those races hadn’t been called.

“Dems’ dreams of holding the House majority probably died tonight,” David Wasserman, the House editor of the nonpartisan Cook Political Report, tweeted Sunday, referring to shifts toward Republicans in three races in those states.

Republicans currently have won 212 House seats with Democrats at 204, according to the Associated Press tally. A party needs 218 for a majority in the chamber. The GOP could end up only a couple of seats above that number, and the party got a boost Sunday by flipping a seat held by Democrats in Oregon.

Headed into the election, Democrats had a 220-212 majority, with three vacancies.

The possibility of an extremely narrow GOP majority is already creating challenges for Minority Leader Kevin McCarthy (R., Calif.). Mr. McCarthy is running to be speaker assuming Republicans take back the House, but he is meeting resistance from his party’s right flank, which now has greater leverage to influence the vote.

Mr. McCarthy will need a simple majority of his conference during Tuesday’s leadership vote, to be selected as the party’s preference for leader. To become speaker, he will need a majority of the full House in a vote in January.

Rep. Andy Biggs (R., Ariz.) plans to run against Mr. McCarthy for the post, according to people familiar with the matter. The ally of former President

Donald Trump

is unlikely to get enough votes to win, but the candidacy could provide a gauge of opposition to Mr. McCarthy.

Allies of Mr. McCarthy made calls to Democratic Rep.

Henry Cuellar

of Texas over the weekend and asked him if he would switch parties to expand the GOP majority, according to five people familiar with the calls.

Mr. Cuellar turned them down, according to multiple people. A spokesman for Mr. McCarthy said the calls weren’t made at the request of Mr. McCarthy. “Anyone suggesting this is simply exercising in fan fiction,” said spokesman Mark Bednar.

Meanwhile, Senate Minority Leader

Mitch McConnell

(R., Ky.) was also facing pushback from some of his Republican members, who questioned whether the party should delay the leadership election until after the Georgia runoff, in which Republican

Herschel Walker

is facing Democratic incumbent Sen.

Raphael Warnock.

The Senate GOP elections are set for Wednesday.

Senate Minority Leader Mitch McConnell. The Senate GOP elections are set for Wednesday.



Photo:

SARAH SILBIGER/REUTERS

New members are in Washington this week for orientation. Some who hadn’t had their races called were also invited and would be included in leadership votes. House Democrats will vote for their leadership later this month and the Senate is expected to keep their same top leaders.

Democrats had performed better than expected in the midterm elections, even with the anticipated loss of the House majority. They picked up a GOP-held Senate seat and flipped some House seats, including in Washington over the weekend.

Of the remaining uncalled competitive House races, a half-dozen were in California. They included the re-election contests of Democratic Reps.

Katie Porter

and

Mike Levin

and GOP Reps. David Valadao, Mike Garcia and Michelle Steel as well as one open seat. Both parties were also intensely watching close contests in Arizona, Colorado and Oregon.

While the contest for House control continued, Senate Democrats celebrated their victory, and the closely watched gubernatorial race in Arizona between Republican Kari Lake and Democrat

Katie Hobbs

remained too close to call. Ms. Hobbs was ahead Sunday evening by about 1 percentage point, with about 160,000 more ballots expected to be counted.

While Ms. Lake had a path to victory, she would need to overperform in all remaining ballots. The campaign manager for Ms. Hobbs, the Arizona secretary of state, released a statement Sunday night calling her “the unequivocal favorite to become the next governor of Arizona.”

In the key swing states of Arizona, Nevada, Michigan and Pennsylvania, candidates who made false claims about the 2020 election ran for positions that can exert great influence over election administration. Here’s a look at some of the results of those midterm races, and what it means for future elections. Illustration: Laura Kammermann

Write to Eliza Collins at eliza.collins+1@wsj.com. and Chad Day at Chad.Day@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Read original article here

US

Senate Democrats Close In on Passing Climate and Tax Bill

Leave a comment

WASHINGTON—The Senate advanced a climate and tax package past a procedural hurdle in the narrowly divided chamber, as Democrats closed in on passing elements of President Biden’s agenda that have languished on Capitol Hill for more than a year.

After the procedural vote, which was approved 51-50 thanks to a tiebreaking vote by Vice President

Kamala Harris,

lawmakers began an hourslong series of votes on amendments that aren’t likely to change the bill’s contents. Once that process is over, the package could receive a final vote in the 50-50 Senate later on Sunday before it is sent to the House, where lawmakers are scheduled to vote on it Friday.

The legislation, which largely survived a review by the Senate’s parliamentarian, raises more than $700 billion in government revenue over 10 years, with much of that coming from a 15% minimum tax on large, profitable corporations and money generated by enhancing tax-collection efforts at the Internal Revenue Service. Empowering Medicare to negotiate lower prescription-drug prices and imposing a 1% tax on stock buybacks will also add revenue to the government’s budget in the next decade.

About $430 billion of those funds would be dedicated toward incentives for companies and individuals to reduce carbon emissions and an extension of subsidies for health insurance under the Affordable Care Act. The legislation dedicates the rest of the new revenue toward reducing the deficit.

The bill meets “all of our goals: fighting climate change, lowering healthcare costs, closing tax loopholes abused by the wealthy, and reducing the deficit,” Senate Majority Leader

Chuck Schumer

(D., N.Y.) said Saturday. “This is a major win for the American people,” he said.

Republicans say that the bill, known as the Inflation Reduction Act, would do little to combat inflation and contains damaging corporate tax increases that would flow down to households.

Democrats united on their climate and healthcare package after making changes Sen. Kyrsten Sinema (D., Ariz.) demanded.



Photo:

Sarah Silbiger/Bloomberg News

Referencing voters’ worries over inflation, Senate Minority Leader

Mitch McConnell

(R., Ky.) said Saturday that Senate Democrats “are misreading the American people’s outrage for yet another reckless taxing-and-spending spree.”

During the amendment process, Republicans largely targeted the bill’s energy and tax provisions. They also offered an amendment to reinstate a pandemic-era policy known as Title 42, which allows migrants to be turned away at the border without a chance to ask for asylum. The Biden administration has sought to end the policy.

Democrats lined up against the GOP proposals as they sought to prevent any changes that could endanger the bill’s support in the chamber.

Sen.

Bob Menendez

(D., N.J.) said Saturday that he would oppose the legislation entirely if lawmakers voted to add immigration restrictions during the amendment process.

“I urge my Democratic colleagues to stand united and vote no on ALL amendments, regardless of the underlying policy and regardless of which party offers them,” Mr. Menendez said.

As they blocked GOP amendments, Democrats occasionally offered parallel proposals that ran afoul of Senate rules, giving lawmakers the opportunity to vote in support of measures without risking alterations to the bill.

Sen. Bernie Sanders (I., Vt.) gave a lengthy speech in the Senate to call on Democrats to expand the legislation’s measures. He said the current bill was inadequate as written.

“What I am asking today is for all 50 Democrats to come together and begin the process of addressing the major crises facing working families,” he said, adding that the bill “has some good features, but also some very bad features.”

In the first amendment of the night, Mr. Sanders introduced an expansion of the drug-pricing provisions, seeking to begin government negotiation for lower prices sooner and apply it to more drugs. It, along with another proposal from Mr. Sanders to broaden the legislation, failed as Democrats joined Republicans to vote them down.

The open-ended amendment process, called a vote-a-rama in the Senate, is the last obstacle Democrats face to pass the legislation, which Democrats are pursuing through a legislative process called reconciliation. Reconciliation allows Democrats to skirt the 60-vote threshold necessary for most legislation in the Senate, but it also requires lawmakers to comply with a special series of rules and undergo the lengthy amendment process.

The Senate’s nonpartisan parliamentarian made a series of rulings on Saturday that found much of the Democrats’ bill complied with reconciliation’s rules.

“I’m happy to report to my colleagues that the bill we presented to the parliamentarian remains largely intact,” said Mr. Schumer said.

Mr. Schumer said the parliamentarian didn’t accept one portion of the bill, related to a requirement that drug companies pay rebates if they raise prices faster than inflation for Medicare and private insurance.

The rebate requirements will only apply to Medicare, and not the commercial market, a setback to Democrats’ efforts to limit drug prices more broadly. A push to cap the cost of insulin at $35 a month could face a similar fate as the rebate provision, and Democrats are preparing to try forcing the issue on the Senate floor and putting Republicans on the spot over the sensitive political issue.

After reaching an agreement with Sen. Joe Manchin (D., W.Va.), who has resisted much of Democrats’ broader agenda, after months of failed negotiations, Democrats had to make a series of final changes this week to the bill on Thursday to earn the support of Sen.

Kyrsten Sinema

(D., Ariz.). They agreed to pare back elements of the corporate minimum tax and to drop a proposed tax increase on carried-interest income.

Ms. Sinema hasn’t explicitly committed to supporting the bill, saying she wants to see its final form after the amendment process.

Sen. Joe Manchin (D., W.Va.) has resisted much of Democrats’ broader agenda.



Photo:

Rod Lamkey/Zuma Press

If Democrats are successful in passing the bill, its passage would mark a victory for their party just months before the midterm elections, which polls show will be challenging for Democrats in large part because of public concern over inflation.

Beginning in 2026, the bill would for the first time empower Medicare to negotiate the prices of a limited set of drugs selected from among those that account for the biggest share of government expenditures. It would also cap out-of-pocket drug costs for Medicare beneficiaries at $2,000 a year, beginning in 2025, and starting next year mandate free vaccines for Medicare enrollees. Under the bill, subsidies enacted last year as part of the American Rescue Plan to help people buy health insurance through the Affordable Care Act would be extended for three years, through 2025, at a cost of $64 billion.

On climate change, the bill pumps money into wind and solar projects, along with the batteries to store renewable energy, while also subsidizing technology to capture and store carbon-dioxide emissions. Consumers would benefit from subsidies for certain windows, heat pumps and other energy-efficient products, as well the extension of a $7,500 tax credit to buy electric vehicles.

Builders, homeowners and small businesses could avail themselves of new capital pouring into so-called green banks, which will receive $20 billion to provide low-cost financing for energy-efficient products such as heat pumps, windows, solar panels, insulation and electric-vehicle charging stations.

The most significant climate provisions are tax credits that would channel billions of dollars to wind, solar and battery developments that put clean power onto the grid, according to Rhodium Group, an independent research firm. The group estimated that the bill would cut greenhouse-gas emissions 31% to 44% below 2005 levels in 2030, compared with 24% to 35% under current policy.

Write to Siobhan Hughes at siobhan.hughes@wsj.com and Andrew Duehren at andrew.duehren@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Read original article here

Business

Senate Plan Would Put Bitcoin, Ether Under Commodity Regulator’s Watch

Leave a comment

WASHINGTON—Leaders of a Senate committee are pitching legislation that would assign oversight of the two largest cryptocurrencies, bitcoin and ether, to the federal agency that regulates milk futures and interest-rate swaps.

Senate Agriculture Committee Chairwoman Debbie Stabenow (D., Mich.) and top-ranking Republican John Boozman of Arkansas unveiled a plan Wednesday that would empower the Commodity Futures Trading Commission to regulate spot markets for digital commodities, a newly created asset class. Currently the CFTC has authority to police derivatives, such as futures and swaps, rather than underlying commodities.

The bill marks the latest salvo in an intensifying battle among federal agencies and congressional committees that oversee them over who will regulate crypto. Thirteen years after bitcoin was created, cryptocurrencies remain largely unregulated by the federal government, leaving investors without key protections from fraud and market manipulation.

The competition for jurisdiction heated up in recent months as a meltdown in crypto markets underscored the need for guardrails in the eyes of many policy makers. The competition also reflects the industry’s ramped-up lobbying presence in Washington and its push to reach more mainstream investors through Super Bowl ads and other high-profile marketing initiatives.

“‘When there’s a topic as hot as crypto, everybody wants a seat at the table.’”


— Aaron Klein, Brookings Institution senior fellow

“When there’s a topic as hot as crypto, everybody wants a seat at the table,” said

Aaron Klein,

a senior fellow at Brookings Institution who focuses on financial regulation. “The question is, are we going to have regulatory turf paralysis?”

In practical terms, for federal agencies such as the CFTC, Securities and Exchange Commission, and Federal Reserve, adding crypto to their remit would bring bigger budgets, greater influence and more job opportunities for officials who leave public service. For members of the congressional committees that oversee such regulators, a new industry in their sandbox would create another stream of lobbyists and campaign donations.

“We need to treat this seriously and take our responsibilities seriously for protecting consumers,” Ms. Stabenow said in a virtual press conference alongside Mr. Boozman.

Washington has introduced a flurry of bills in recent months to draw jurisdictional lines. Sens.

Cynthia Lummis

(R., Wyo.) and

Kirsten Gillibrand

(D., N.Y.) unveiled a proposal in June that would create exemptions for cryptocurrencies in securities laws, banking statutes and tax code. In July, leaders of the House Financial Services Committee said they were working on a bill to grant the Federal Reserve a greater role in regulating some stablecoins, crypto tokens pegged against the dollar and other official currencies.

When cryptocurrency lending platform Celsius froze user accounts amid a plunge in valuations, it sent ripples across the industry and raised questions about what happens to user assets if a crypto platform files for bankruptcy. WSJ’s Vicky Ge Huang explains. Photo illustration: Jordan Kranse

Agencies also are seeking to claim territory. CFTC Chairman

Rostin Behnam,

a former staffer to Ms. Stabenow, said last week his agency is “ready and well situated” to oversee spot markets for some cryptocurrencies. He has worked with his former boss for months to help craft legislation that would authorize the CFTC to do so, people familiar with the matter say.

Meanwhile, SEC Chairman

Gary Gensler

has repeatedly demanded that cryptocurrency-trading platforms such as

Coinbase Global Inc.

register with the agency as securities exchanges akin to the New York Stock Exchange or Nasdaq. In May, the SEC nearly doubled the staff of an enforcement unit focused on cryptocurrencies.

“Four years ago when I started this job, there were some people that just thought this thing was all going to blow up and go away, that this was sort of a passing fad,” said Kristin Smith, executive director of the Blockchain Association, a trade group representing crypto firms.

Now, she said, “We’ve got all these regulators suddenly vying for control.”

After the SEC alleged in an insider-trading case in July that at least seven cryptocurrencies listed on Coinbase should have been registered as securities, Republican CFTC Commissioner

Caroline Pham

accused the SEC of “regulation by enforcement.”

“The SEC is not working together with the CFTC,” Ms. Pham said in an interview. “They go out unilaterally to try to establish precedent that’s going to dramatically reshape the landscape as to what’s a security and what’s a commodity.”

Ms. Pham has posted photos to her

Twitter

account of herself posing alongside crypto lobbyists and executives including

Sam Bankman-Fried,

the billionaire founder of trading platform FTX.

Ms. Pham said that crypto is one of the areas she is focused on, and, “I take pictures with everybody. Like, literally, everybody.”

At the heart of the turf war are questions about how cryptocurrencies fit into the definition of a security, the legal classification that includes stocks and bonds.

Coinbase and other firms have lobbied Congress to create a new category for digital commodities and empower the CFTC to regulate it.



Photo:

Shannon Stapleton/REUTERS

A 1946 Supreme Court case created a test that focuses on whether investors buy an asset in hopes of profiting from the efforts of other people. If so, the issuer is required to register with the SEC and publicly disclose any information that may be material to the security’s price.

Even though investors in bitcoin and ether rely on a network of users and programmers to validate transactions and perform software updates, cryptocurrency enthusiasts insist those groups are too decentralized for the assets to be regulated like securities. Instead, they argue, the assets should be considered commodities, which have a broader definition and no full-time regulator.

Firms such as Coinbase, FTX and Ripple have spent millions of dollars over the past year lobbying Congress to create a new category for digital commodities and empower the CFTC to regulate it. The agency has roughly one-sixth the head count of the SEC, and its rules are seen by the industry as easier to comply with than securities laws.

“When you ask the people that are in the industry…almost all feel like the regulator should be primarily the CFTC,” Mr. Boozman said. “The fact that they’re fairly united on that makes it easier on members.”

Crypto skeptics worry that creating a new legal concept for cryptocurrencies could create an alternative to securities registration for a wider variety of assets.

“People who are taking action that could undermine our securities law are playing with fire,” said Dennis Kelleher, president of investor-advocacy group Better Markets. “You may love or hate the SEC, but transparent disclosure, clear rules…and enforcement is what builds trust and confidence in our markets.”

The legislation being unveiled Wednesday would seek to exclude securities from the definition of digital commodities, making it narrower in scope than that of other crypto-related bills floated in recent months, such as the Lummis-Gillibrand proposal.

Ms. Stabenow said she expects the Agriculture Committee to hold a hearing on the bill as early as September.

SHARE YOUR THOUGHTS

How should the two largest cryptocurrencies, bitcoin and ether, be regulated? Join the conversation below.

The bill would require any entity acting as a digital commodity platform—including crypto exchanges such as Coinbase and FTX—to register with the CFTC as trading facilities, dealers or brokers. The exchanges would have to monitor trading, protect investors from abuse and only offer assets that are resistant to market manipulation, among other requirements.

Platforms also would be obliged to disclose some information about the assets they list, such as operating structure and conflicts of interest. Such information would likely fall short of the extensive disclosures required by the SEC for securities.

The derivatives markets the CFTC currently oversees are dominated by professional investors, such as banks and hedge funds. Crypto markets, by contrast, draw legions of small investors who are more vulnerable to scams.

If the agency wins jurisdiction over bitcoin and ether, the CFTC would have to write rules from scratch to protect such investors.

“How robust would they be and how long would that take?” asked Tyler Gellasch, executive director of the Healthy Markets Association, an investor trade group.

Write to Paul Kiernan at paul.kiernan@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Read original article here

World

Biden Faces Fresh Domestic Challenges After Europe Summits

Leave a comment

President Biden returned from Europe with a deal to expand the NATO alliance and plans for the biggest U.S. military footprint in the continent since the Cold War. But awaiting him back home was a host of domestic challenges, including intraparty frustration with his response to the Supreme Court’s ruling overturning abortion rights, continuing economic worries and questions about the fate of his legislative agenda.

With some fellow Democrats calling for him to be more forceful on abortion, Mr. Biden endorsed making an exception to filibuster rules to pass legislation codifying Roe v. Wade into law, as he wrapped up his trip. And on his first day back, he met virtually with Democratic governors, some of whom continued to push Mr. Biden to make more use of federal resources to protect access to abortion.

Read original article here

Business

Lisa Cook Wins Senate Confirmation to Federal Reserve

Leave a comment

The Senate voted to confirm

Lisa Cook

to the Federal Reserve, making her the first Black woman to sit on the central bank’s board.

Ms. Cook was approved Tuesday on a party-line vote, 51-50, with Vice President

Kamala Harris

breaking a tie. Ms. Cook is the second Fed nominee of President Biden to win Senate confirmation, following Fed governor

Lael Brainard,

who was approved as the central bank’s vice chairwoman last month.

Ms. Cook’s confirmation Tuesday evening paves the way for lawmakers to confirm two additional picks this week, including

Jerome Powell,

whose four-year term as chairman expired in February. He has been serving in an acting capacity since then and is poised to win bipartisan support for a second term as chairman.

Philip Jefferson,

an economist at Davidson College, is a Fed board nominee who won unanimous support from the Senate Banking Committee in March.

An effort to advance Ms. Cook’s nomination stalled last month because of absences on the Democratic side of the aisle related to Covid-19. Her term runs through January 2024.

Ms. Cook served as an economist on the staff of the Council of Economic Advisers during the Obama administration. Her research has focused on policies that promote broad economic opportunity, particularly for racial minorities and women.

Some Republicans suggested at Ms. Cook’s February confirmation hearing that she lacked sufficient experience in macroeconomics and monetary policy, a claim she countered by highlighting her research experience and work at the Treasury Department and White House.

The nominations of Ms. Cook and Mr. Jefferson would allow Mr. Biden to put his stamp on the central bank and fulfill promises made to improve the diversity of its top leadership. Not including Ms. Cook, Mr. Jefferson would be the fourth Black governor and the first since 2006.

Mr. Biden has also nominated

Michael Barr,

a law professor who served as a top Treasury Department official in the Obama administration, to serve as the Fed’s vice chair of supervision.

Philip Jefferson won unanimous support from the Senate Banking Committee in March for a position on the Fed board.



Photo:

Ken Cedeno/Bloomberg News

Fed officials are focused on raising interest rates to cool down demand and slow economic growth and inflation. The Fed last week approved an increase of a half-percentage point in its policy rate, to a range between 0.75% and 1%, and Mr. Powell signaled similar moves were likely to follow at policy meetings in June and again in July.

“While I’ll never interfere with the Fed’s judgments, decisions, or tell them what they have to do—they’re independent; they’re independent—I believe that inflation is our top economic challenge right now, and I think they do too,” Mr. Biden said Tuesday.

Some analysts have speculated that the new governors might favor less-aggressive rate increases, but they are unlikely to slow the Fed from advancing a faster pace of tightening as long as inflation is running well above the central bank’s 2% target. Ms. Cook and Mr. Jefferson said at their Senate appearances in February that tackling high inflation should be a central-bank priority.

The Fed’s governors are traditionally the most consensus-oriented members of an already consensus-oriented rate-setting committee. “The new additions will likely adapt more to the existing institution rather than vice versa,” said

Tim Duy,

chief U.S. economist at the research firm SGH Macro Advisors.

If inflation shows signs of slowing to an annual rate below 3%, the central bank would face a more spirited debate over how and when to moderate the pace of rate increases.

Write to Nick Timiraos at nick.timiraos@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the May 11, 2022, print edition as ‘Senate Confirms Fed Board Nominee.’

Read original article here

US

Senate Passes Bill to Protect Supreme Court Justices’ Families

Leave a comment

Demonstrators in front of the Supreme Court building on Monday.



Photo:

Anna Moneymaker/Getty Images

WASHINGTON—The Senate swiftly passed a bill to expand police protections for Supreme Court justices to include their immediate family members, in the wake of protests following a leaked draft ruling that indicated the court could overturn Roe v. Wade.

The measure passed late Monday by unanimous consent. The broad support in the Senate suggests a clear pathway to passage in the House, but no immediate plan was set.

A leaked draft opinion published last week by Politico suggested that the conservative wing of the court was preparing to undo the 1973 Roe decision, which established abortion as a constitutional right, in a Mississippi abortion case the justices are currently considering. Chief Justice

John Roberts

confirmed the draft was authentic but cautioned it wasn’t final.

Protesters marched in several American cities after Politico published a leaked draft opinion indicating that Roe v. Wade may be overturned. The 1973 precedent established a constitutional right to an abortion. Photo: Michael Reynolds/Shutterstock

The Supreme Court is currently surrounded by security fencing to guard against potential threats. Over the weekend, some protesters demonstrated outside the home of Supreme Court Justice

Brett Kavanaugh

in suburban Chevy Chase, Md.

Senate Minority Leader

Mitch McConnell

(R., Ky.) accused progressives of trying to harass justices at their homes in order to achieve a desired judicial outcome, saying they were trying to “replace the rule of law with the rule of mobs.” He also said the White House had been slow to condemn such protests.

At the daily White House briefing Monday, press secretary

Jen Psaki

said protesters “should never resort to violence, to threats, to intimidation in any way, shape, or form.”

The Senate is scheduled to vote this Wednesday on whether to take up legislation to assert healthcare providers’ right to provide an abortion before a fetus is viable, and to say that a patient has a right to receive one, in line with current Supreme Court precedent. In a 50-50 Senate where most legislation requires a 60-vote supermajority to advance, the bill is expected to be blocked.

If Roe is overturned, states’ law would determine abortion policy. Some states have plans in place to sharply curtail access to abortions, while other states have moved to codify existing law.

Write to Siobhan Hughes at siobhan.hughes@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the May 10, 2022, print edition as ‘Bill to Boost Security For Justices Advances.’

Read original article here

US

Did Supreme Court Nominees Lie to Congress?

Leave a comment

One media narrative congealing after this week’s Supreme Court leak is that President Trump’s nominees lied to Congress by claiming they wouldn’t overturn the abortion precedent of Roe v. Wade. So allow us to check the tape—and explain why respecting past decisions doesn’t bind the Court to stand by serious constitutional errors.

Democratic leaders Nancy Pelosi and Chuck Schumer accused “several” of the “conservative Justices” of having “lied to the U.S. Senate, ripped up the Constitution and defiled both precedent and the Supreme Court’s reputation,” among other modest claims in a statement after Politicopublished a draft opinion written by Justice Samuel Alito. The insinuation is that Justices Neil Gorsuch, Brett Kavanaugh and Amy Coney Barrett promised Congress they wouldn’t touch Roe.

Read original article here

US

House Passes $1.5 Trillion Omnibus Package That Includes Aid for Ukraine

Leave a comment

WASHINGTON—The House passed a $1.5 trillion spending bill that includes emergency aid for Ukraine, after Democratic leaders stripped out a contentious Covid-19 aid provision that would have clawed back states’ unused coronavirus money to fund the proposal.

The decision to remove the $15.6 billion in Covid-19 aid was a dramatic setback for both House Speaker Nancy Pelosi (D., Calif.), who negotiated the plan only to see many rank-and-file Democrats reject it, and President Biden, whose administration originally asked for $22.5 billion to fund vaccines, treatments and research and now will get nothing.

Lawmakers released the more than 2,700-page omnibus spending package early on Wednesday, giving lawmakers just hours to read it. To pass the House, leadership divided the bill into two parts: The defense portion of the bill passed in a 361-69 vote, and the nondefense portion of the bill passed in a 260-171 vote. The bill now heads to the Senate.

Ukrainian refugees at a border crossing in Romania. The spending package unveiled Wednesday would send $13.6 billion to Ukraine.



Photo:

Andreea Campeanu/Getty Images

The package, which funds the federal government for the rest of the fiscal year and also provides $13.6 billion in aid for Ukraine, comes after months of negotiations between Democratic and Republican leaders. Roughly half of the funds for Ukraine is allocated for humanitarian and economic aid and the other half for defense in Ukraine as well as U.S. allies in the Baltics and Central and Eastern Europe.

Mrs. Pelosi, after deliberating for several hours with upset lawmakers, announced Wednesday afternoon that the Covid-19 funding would be removed and lawmakers would proceed with the omnibus bill. She cited resistance within her own caucus to the provision, which would offset the new Covid-19 funding with previously approved but unspent coronavirus relief funds from some states.

“You’re telling Noah about the flood. I didn’t get what I wanted in this bill,” Mrs. Pelosi said, emphasizing that any deal would need bipartisan support to get through both chambers of Congress.

“Let’s grow up about this. We are in a legislative process. We have a deadline,” she said.

A White House official said Congress needed to approve new Covid funding to avoid dire consequences, including a decline in testing capacity and a winddown in funding for healthcare coverage and treatments in coming months.

“Failing to take action now will have severe consequences for the American people,” the official said.

Republicans, citing the trillions of dollars already spent on coronavirus-related aid packages since 2020, had opposed allocating more money for the pandemic until earlier funding was accounted for. Negotiators sought to capture money that had been appropriated but not spent, but some Democratic lawmakers said they felt blindsided by the Covid-19 provision.

The $15.6 billion for Covid-19 aid was intended to prepare for future variants or spikes in cases by allowing the government to purchase supplies of monoclonal antibodies, oral antivirals and vaccines before shortages arise. The spending bill also called for the return of $15.7 billion that was appropriated in previous coronavirus response bills to the Treasury.

“We’ve got a job to do, We’ve got to pass this bill and that’s what we want to do today,” Rep.

Pete Aguilar

(D., Calif.), the vice chair of the Democratic Conference, about the decision to remove coronavirus funding.

Since most bills require 60 votes to proceed in the 50-50 Senate, it is unlikely the coronavirus funding could pass Congress without being tied to a must-pass piece of legislation like the omnibus. Still, House Democrats introduced a stand-alone Covid bill late Wednesday, proposing $15.6 billion in spending, partially offset by $8.6 billion in unused coronavirus funds but without any clawbacks from state and local governments. After initially planning to vote on it Wednesday night, the matter was pushed to next week, according to aides.

A number of Democrats from states that would be forced to give up money complained to House leadership, with some gathering in Mrs. Pelosi’s office in the hopes of coming to a compromise. While some Republicans were expected to vote in support of the legislation, the numbers weren’t known. Democrats have a narrow majority and can only lose five votes without GOP support.

“I vehemently oppose efforts to snatch back the lifesaving resources we need to fully and equitably recover from this pandemic,” said Rep.

Cori Bush

(D., Mo.), whose home state would have money repurposed.

House Speaker Nancy Pelosi (D., Calif.) had faced pushback among some Democrats from states that would have to give up Covid-19 aid money.



Photo:

Al Drago/Bloomberg News

Earlier in the day, Mrs. Pelosi defended the arrangement, saying it was needed to reach a deal with GOP negotiators. Some Democrats were baffled by the last-minute setback.

“What should be a slam dunk for Democrats as the party of science and public health has become yet another intraparty battle—and one that leaves the nation more vulnerable to future surges,” said Rep.

Jake Auchincloss

(D., Mass.), co-chair of the Global Vaccination Caucus.

Arkansas’ Republican Gov.

Asa Hutchinson

and New Jersey’s Democratic Gov.

Phil Murphy

objected to the rescission of any coronavirus money appropriated to state and local governments. In a letter to Congress on Tuesday, they said such a move would create a “bad precedent in which state and local governments can no longer count on commitments made from one law to the next.”

Democrats had planned to pass the omnibus around midday Wednesday before heading to their party retreat in Philadelphia later in the day. The Senate would then debate the legislation and vote on it this week. But the fight over the Covid-19 funding upset that tight timeline.

“Democrats dropped the bill that’s a thousand pages in the middle of the night,” said House Minority Leader

Kevin McCarthy

(R., Calif.).

The large spending bill is expected to take several days to work its way through Congress, and current government funding runs out at 12:01 a.m. ET Saturday. To address this, House lawmakers late Wednesday approved in a voice vote a stopgap bill to fund the government through March 15 to avoid a lapse in funding that would lead to a partial shutdown.

President Biden announced a ban Tuesday on Russian oil imports into the U.S., amid calls from bipartisan lawmakers to take action. The U.S. will also ban imports of Russian natural gas and other energy sources, Mr. Biden said. Photo: Kevin Lamarque/Reuters

The package would appropriate $730 billion in nondefense funding, a $46 billion increase over fiscal year 2021 and the largest in four years. The spending package appropriates $782 billion in defense funding—an increase of $42 billion over fiscal year 2021.

Lawmakers unified over providing the aid to Ukraine as the civilian toll caused by the Russian invasion mounted in recent days. Ukrainian President

Volodymyr Zelensky

asked the U.S. Congress for more equipment, specifically planes. Part of the Ukrainian aid funding allows the president to transfer $3 billion in defense equipment to Ukraine and other U.S. allies.

Also on Wednesday, the House overwhelmingly passed a bill to ban Russian oil imports, even after Mr. Biden decided to move forward with a ban using his own executive authority.

The legislation will also reauthorize the Violence Against Women Act, after senators came to a bipartisan agreement to reauthorize the legislation after it expired in 2019. It provides funding for prosecutions of domestic violence crimes, as well as for shelters and other programs to aid victims of abuse.

Lawmakers also reached a deal to reauthorize the EB-5 visa program allowing foreign investors to apply for green cards after investing in U.S. real estate or other projects. The program lapsed last year over a push to make its criteria stricter.

The legislation includes a $675 million budget increase for the Internal Revenue Service, putting the agency’s budget at $12.6 billion. That is below what House Democrats had wanted, and it is separate from the Biden administration’s attempt in the stalled Build Back Better bill to double the agency’s size over the next decade and beef up tax enforcement. Still, the IRS will get money specifically dedicated to reducing processing backlogs, which have left millions of people still waiting for refunds from returns they filed last year.

—Teresa Mettela contributed to this article.

Write to Natalie Andrews at Natalie.Andrews@wsj.com, Siobhan Hughes at siobhan.hughes@wsj.com and Eliza Collins at eliza.collins+1@wsj.com.

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Read original article here

Business

SEC Floats Rules to Shore Up Money Markets, Curb Insider Trading

Leave a comment

WASHINGTON—The Securities and Exchange Commission issued a raft of proposals Wednesday including measures aimed at shoring up money-market funds and curbing executives’ ability to trade their own companies’ stock.

The proposals, some of which surprised Wall Street executives with their scope, indicate that Chairman

Gary Gensler

is moving quickly to enact a policy agenda that observers have called the SEC’s most ambitious in decades. That stands in contrast to other financial regulators, for which President Biden has yet to fill key positions, and saw a nominee withdraw amid Senate skepticism during confirmation.

With a thin majority in Congress, Democrats are leaning on Mr. Gensler to advance progressive priorities such as fighting climate change and curbing the power of big business. The SEC’s authority to write rules for asset managers, publicly traded companies and the stock market provides powerful, if sometimes roundabout, tools for achieving such goals.

The proposals “will go a long way toward increasing corporate transparency and accountability,” Sen.

Sherrod Brown

(D., Ohio), chairman of the Senate Banking Committee, said, praising enhanced disclosures around stock buybacks. “The first step to workers getting their fair share is learning just how much corporate executives are spending on themselves.”

Mr. Gensler’s agenda reflects political divisions. Three of the four proposals garnered party-line votes from the SEC’s five commissioners. Republicans

Hester Peirce

and

Elad Roisman

supported only a plan to tighten rules on how and when corporate insiders can sell their companies’ stocks. The agency is independent of the Biden administration.

The other proposals “are a partisan overreach that will likely diminish investment opportunities, economic growth and capital formation,” Sen.

Pat Toomey

(R., Penn.), the top Republican on the Senate Banking Committee, said.

Two of the proposals put forward Wednesday seek to make the financial system more stable by reducing panicked investors’ tendency to flee money-market funds and by regulating opaque derivatives known as “swaps.” The other two rules would seek to enhance fairness and transparency in the stock market. They would introduce new restrictions on corporate executives’ trading and heighten disclosure requirements around share buybacks by publicly traded companies.

The new rules for money-market mutual funds aim to prevent episodes that occurred during the past two recessions, in 2008 and 2020, when the Federal Reserve was forced to backstop the funds after they were hit with a wave of redemption requests that caused credit markets to seize up.

Money markets are typically used by corporate treasurers, pension funds and millions of individual investors as a safe place to park cash and earn a higher return than they could obtain in a bank account. They provide companies with liquidity for short-term loans, called “commercial paper,” to cover immediate expenses like payroll.

But money-market funds aren’t regulated like banks, which must meet minimum capital requirements and offer deposit insurance. Regulators say this makes them more susceptible to runs when markets are under severe stress, creating broader risks to the financial system.

“This is about resiliency,” Mr. Gensler said in an interview, noting that Americans have roughly $5 trillion invested in money markets. “Though there have been reforms in 2010 and 2014, we found again in 2020 some instability…with the dash for cash.”

The SEC’s proposed changes include a measure called “swing pricing” that firms including

BlackRock Inc.

and

Federated Hermes Inc.

have warned could destroy a subset of the industry that holds short-term corporate debt and caters to institutional investors. The measure would require these funds to adopt policies for adjusting their share prices by a “swing factor” on days when they have net redemptions. The factor would be determined by transaction costs and the market impact of selling a slice of the fund’s portfolio.

The goal is to protect investors who remain in the fund from dilution by investors who redeem their shares, Mr. Gensler said.

The SEC’s timing caught money-market fund managers off guard, said

John Tobin,

investment chief at Dreyfus Cash Investment Strategies, which oversees $350 billion in money funds. Many didn’t expect to see the new proposed rules until next spring, he said.

The swing-pricing proposal is likely to draw universal industry opposition, said Mr. Tobin, whose business is a unit of

Bank of New York Mellon Corp.

He said the rule would create operational challenges and could encourage institutional investors to head for the exits before a fund executes any swing-price decision.

“It’s definitely a shot across the bow,” he said. “This is a watershed moment.”

The SEC also proposed significant restrictions on arrangements, known as 10b5-1 plans, by which corporate officers and directors schedule stock trades ahead of time to avoid running afoul of insider-trading rules. Among other changes, the agency would require executives to wait 120 days before buying or selling their employer’s stock after setting up or modifying the plans.

That proposal follows academic research suggesting the arrangements are being abused as company leaders cash in at historic levels on their companies’ shares.

“The core issue is that these insiders regularly have material information that the public doesn’t have,” Mr. Gensler said in a statement. Wednesday’s proposed changes seek to ensure their stock trading is done “in a way that’s fair to the marketplace,” he added.

Commissioners also voted 3-2 along party lines to propose increased disclosures around public companies’ stock buybacks, which are also hitting records this year.

Repurchases support stock prices by reducing the number of shares outstanding in a company, lifting the firm’s earnings per share. Like dividends, they enable companies to return cash to investors. But critics, including many Democrats, say buybacks give executives who are partly paid in equity or options a roundabout way of boosting their own compensation, at the expense of workers’ wages or productive investments.

The SEC’s proposal would require stock-buyback disclosures to be more detailed and more frequent. Rather than disclosing monthly aggregate share repurchases once a quarter, companies would have to report buybacks on the next business day. They would also have to indicate whether any executives bought or sold shares within 10 business days of a buyback program’s announcement.

“Companies may determine to allocate capital towards share repurchases for a number of different reasons,” Democratic SEC Commissioner

Allison Lee

said. “But one of those reasons should not be for the opportunistic, short-term benefit of executives.”

The SEC’s chief economist,

Jessica Wachter,

said during the meeting that the costs of complying with the increased disclosure requirements might discourage some companies from buying back stock. Ms. Peirce and Mr. Roisman issued strong dissents against the rule.

“Say ‘dividend,’ and nobody gets angry, but say ‘share buyback,’ and the rage boils over,” Ms. Peirce said. “Today’s proposal channels some of that rage against repurchases in a way that only a regulator can: through painfully granular, unnecessarily frequent disclosure obligations.”

—Justin Baer contributed to this article.

Write to Paul Kiernan at paul.kiernan@wsj.com

Corrections & Amplifications
The SEC proposed significant restrictions on 10b5-1 plans. An earlier version of this article incorrectly referred to them as 10b5-5 plans. (Corrected on Dec. 15.)

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Read original article here

US

House Approves Increase in Debt Ceiling, Sending Measure to Biden

Leave a comment

WASHINGTON—Congress passed a measure raising the government’s borrowing limit by $2.5 trillion, sending to President Biden’s desk legislation that is expected to push the next debt-ceiling standoff past the midterm elections.

The Senate voted 50-49 to approve the legislation in the afternoon, and the House later passed it 221-209. The Treasury Department, which has been taking such steps as suspending certain investments to conserve cash, has warned lawmakers that it could be unable to meet the country’s obligations as soon as Wednesday if the debt ceiling isn’t raised.

Final passage of the debt ceiling increase through Congress concludes weeks of work on the issue. In an effort to keep their political distance from the ceiling increase, Republicans negotiated an agreement allowing Senate Democrats to raise the borrowing limit along party lines, instead of with the 60 votes typically needed to advance legislation in the Senate.

That procedural agreement was codified in a separate piece of legislation that the Senate passed last week with bipartisan support.

In a sign of the complicated politics of the debt limit vote, Senate Majority Leader

Chuck Schumer

(D., N.Y.) thanked Republicans for working with Democrats on the procedural agreement and avoiding the brinkmanship that marked the issue earlier this year.

Republican Sen. Mitch McConnell, right, on Tuesday.



Photo:

jim lo scalzo/EPA/Shutterstock

“No brinkmanship, no default on the debt, no risk of another recession: responsible governing has won on this exceedingly important issue. The American people can breathe easy and rest assured there will not be a default,” he said. “I thank the Republican leader and my Republican colleagues who voted with us to address this issue.”

Senate Minority Leader Mitch McConnell (R., Ky.), meanwhile, criticized Democrats for allowing more borrowing. Raising the debt limit doesn’t authorize new spending, but instead allows the government to issue new debt to pay for existing obligations, such as Social Security benefits and interest on the debt.

“Later today, every Senate Democrat is going to vote on party lines to raise our nation’s debt limit by trillions of dollars,” Mr. McConnell said.

As lawmakers prepare for another hike in the debt ceiling, WSJ’s Greg Ip explains why it’s economically feasible for the U.S. to keep borrowing, as long as interest rates stay low.

Lawmakers have in recent years largely suspended the debt limit for a period of time, but Republicans had sought to force Democrats to sign on to a specific level of debt.

Authorizing enough debt to last through the midterm elections was part of the negotiations between Messrs. McConnell and Schumer, according to people familiar with the matter. Democrats landed on $2.5 trillion, rather than a much larger increase that would allow lawmakers to avoid the issue for years, as an amount that would fulfill the country’s obligations for roughly that long, according to one of the people.

The legislative legerdemain needed to craft the multistep procedural agreement and raise the debt limit this year is a sign of the difficulty lawmakers may face on the issue in 2023.

Republicans are favored to win control of the House in next year’s midterms, meaning future negotiations over the issue could become more fraught. The agreement between Messrs. McConnell and Schumer disappointed many Republicans, who wanted the GOP to do more to resist a debt-limit increase.

Addressing another piece of year-end business, the Senate voted 86-13 on Tuesday to advance the National Defense Authorization Act, a $778 billion defense policy and budget bill that includes a 2.7% pay raise for troops and money for military construction, ships and aircraft. The legislation also creates an independent commission to study the Afghanistan War and makes historic changes to the military-justice system, removing commanders’ authority to make prosecutorial decisions about some serious crimes such as sexual assault, murder and kidnapping.

Final passage of the bill is expected in the Senate on Wednesday, with bipartisan support. It will then head to President Biden’s desk for his signature.

Write to Andrew Duehren at andrew.duehren@wsj.com

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the December 15, 2021, print edition as ‘Senate Approves Measure To Raise Borrowing.’

Read original article here