WH May Act On Inversions Soon
Treasury Secretary Lew says action on inversions coming soon. Politico: "...Lew promised on Monday to crack down on so-called corporate tax inversions 'in the very near future' though he offered few clues as to what may be in the offing ... Lew said that while the administration prefers that Congress take action ... it remains 'clear-eyed' about the likelihood that lawmakers will not act anytime soon ... [Sen. Chuck] Schumer is putting the finishing touches on legislation to cut the amount of interest such firms could deduct to 25 percent of taxable income, down from the current 50 percent. It would require the U.S. subsidiaries of inverted firms to win annual IRS approval of certain transactions for 10 years after moving abroad. His proposal would also bar such companies from carrying interest deductions forward and repeal the so-called debt-to-equity safe harbor."
Corporate defense of inversions "hogwash" says NYT's Joe Nocera: "For starters, American multinationals, with their high-powered tax departments, rarely pay 35 percent or anything close to it. And those earnings that are supposed to get taxed upon repatriation? Needless to say, they never get repatriated..."
Fed will push for stringent capital standards. Bloomberg: "The Federal Reserve is planning risk-based capital standards for banks that are tougher than those developed by their international counterparts, Fed Governor Daniel Tarullo will tell lawmakers today. The U.S. capital surcharge for large banks will be higher than the level required by the 27-nation Basel Committee on Banking Supervision, Tarullo said in testimony for the Senate Banking Committee. The surcharge formula will take into account U.S. banks’ reliance on short-term wholesale funding, he said."
House Leadership Wants Short Ex-Im Deal
Long-term Ex-Im extensions is "dead" reports The Hill: "Supporters of the Export-Import Bank are shifting their strategy and pushing for a short-term extension of the bank’s charter ... that coincides with the same period of time as the continuing resolution (CR), which Congress must approve before Sept. 30 to prevent a government shutdown ... The bank’s critics are looking to offer a longer-term reauthorization deal that would extend Ex-Im into early next year. But supporters view this ploy as a political Trojan horse ... 'A short term CR that leaves Ex-Im hanging out on its own into 2015 is a death knell for the bank,' said a former senior Ex-Im official who is working to reauthorize the bank."
"Whether to attach an extension of the Ex-Im bank is the main sticking point in House-Senate negotiations [over funding the government]" reports Bloomberg.
House to take anti-clean water vote today. The Hill: "The House is likely to vote Tuesday to stop what Republicans have characterized as a massive federal overreach by the EPA. A bill sponsored by Rep. Steve Southerland (R-Fla.) would stop the EPA from working on the 'waters of the United States' rule, which it proposed in March to clarify its jurisdiction under the Clean Water Act (CWA). Though it’s unlikely to get enough support to pass the Senate, the White House made its opposition to the bill known Monday with a veto threat, saying that 'clarifying the scope of the CWA helps to protect clean water, safeguard public health, and strengthen the economy.'"
Senate GOP Mischief
Republicans advance campaign finance constitutional amendment, but have ulterior motive. Politico: "Many of the Republicans only voted for the bill to foul up Democrats’ pre-election messaging schedule, freezing precious Senate floor time for a measure that ultimately has no chance of securing the two-thirds support necessary in both the House and Senate to amend the Constitution ... some Democratic aides said they were happy for the debate to consume the Senate this week and still plan to hold votes on raising the minimum wage and pay equity before breaking for campaign season."
More than 220 WH nominations are stuck. Politico: "At the Homeland Security Department, Obama has no Senate-confirmed policy chief in place to handle terrorism and cybersecurity threats and the immigration crisis on the southern U.S. border. Obama wants to act on climate change, but the Environmental Protection Agency is missing several of the political leaders needed to shepherd regulations through a demanding process with tight scrutiny from industry, environmentalists, other federal agencies and the White House’s own budget crunchers. And the scandal-plagued Department of Veterans Affairs is hesitant to make some big new policy changes until it gets a fresh batch of political leaders ... [Though the] Senate in the last 10 months has confirmed more than 100 of Obama’s picks for a range of high-level jobs, the byproduct of Reid’s November 2013 'nuclear' rule change ... Obama isn’t giving up either, announcing plans during the August congressional recess to nominate 18 more officials ..."
Breakfast Sides
VA Gov forced by Republicans to backtrack on Medicaid expansion. NYT: "[Gov. Terry] McAuliffe, who in June ordered his cabinet to devise a plan for unilateral action by Sept. 1, in the face of what he called Republican 'demagoguery' and 'cowardice,' announced that only 25,000 uninsured Virginians would be receiving coverage, far fewer than the 400,000 he has said are eligible if the state expandsMedicaid under the Affordable Care Act. The retreat seemed Mr. McAuliffe’s acceptance that he is politically hemmed in, especially after Republicans took control of both houses of the General Assembly following the surprise resignation of a Democratic senator in June."
Billionaires spending big on lobbyists for "pet projects." Politico: "[Sheldon] Adelson has been pouring money into a fight over the future of online gambling ... [William] Ackman — an investor with a flair for big dramatic bets — has made a huge investment based on the premise that Herbalife will fail. To that end, his company Pershing Square Capital Management has hired lobbying firms and consultants to try to push for government investigations into Herbalife’s business practices."
Job training programs can work, argues American Prospect's Paul Osterman: "...there is much skepticism that training programs perform well. Reports of scandals surrounding proprietary schools with low placement and high debt feed this doubt. But focusing on these failures misses the larger point. Best-practice models exist, and are slowly diffusing. The challenge lies not in ignorance about what works, but how to reach scale in delivering quality programs."
