Overnight Finance: Trump promises tax proposal won’t change 401(k) plans | Trump ‘very, very close’ to picking Fed chair | House to vote on Senate budget | Treasury slams arbitration rule | Trump touts Boeing deal
Trump promises: ‘NO change to your 401(k)’: President Trump on Monday tweeted that changes won’t be made to 401(k) plans after reports that congressional Republicans were considering a major alteration to the retirement accounts in forthcoming tax-reform legislation.
“There will be NO change to your 401(k),” Trump tweeted.
“This has always been a great and popular middle class tax break that works, and it stays!”
Financial industry stakeholders had heard that lawmakers are considering significantly reducing the amount that people can put into 401(k)s on a pretax basis.
Currently, people can generally make contributions of up to $18,000 annually before taxes. But lobbyists had heard that congressional Republicans were weighing lowering the cap to $2,400. The Hill’s Naomi Jagoda reports: http://bit.ly/2yFSiUY.
Treasury opposes consumer bureau arbitration rule: The Treasury Department on Monday criticized the Consumer Financial Protection Bureau’s (CFPB) rule on arbitration, claiming it would impose “extraordinary costs” with little justification.
In a report released Monday morning, the department argued that CFPB failed to consider cheaper, more effective options for consumers than the controversial rule.
The report argues that the rule, meant to prevent financial services companies from blocking class-action lawsuits against them, would lead to 3,000 more suits over the next five years. The department claims those class-actions suits would impose more than $500 million in legal defense fees, giving $330 million to plaintiffs’ lawyers.
“The Bureau’s Rule would upend a century of federal policy favoring freedom of contract to provide for low-cost dispute resolution,” the report states. I’ve got the details here: http://bit.ly/2yExzRO.
House to take up Senate budget on Thursday: The House is expected to vote on the Senate-amended 2018 budget resolution on Thursday, according to a leadership aide, moving ahead the Trump administration’s tax reform efforts.
The budget will allow Republicans to pass tax legislation through a special process called reconcilation, which only requires 51 votes in the Senate instead of the usual 60.
While the House passed its own budget resolution earlier in the month, it is now expected to take up the version the Senate approved last week. The Senate resolution allowed for $1.5 trillion in deficit-financed tax cuts, and did not include $203 billion in mandatory spending cuts the House labored to include.
House conservatives last week agreed to forego a push on the spending cuts in order to expedite tax reform, asking that a bill be passed by Thanksgiving. The Hill’s Niv Elis explains: http://bit.ly/2yEoaJQ.
The decision came after Trump spoke to House Republicans Sunday: President Trump on Sunday pressed House Republicans to adopt their Senate counterparts’ budget so that they can start moving tax-reform legislation.
In a conference call with House Republicans, Trump and GOP leaders said that agreeing to the Senate budget swiftly would help get the process moving faster.
Speaker Paul Ryan (R-Wis.) has said he wants the House to pass a tax bill in November, with a goal of enacting it into law by the end of the year.
“We are on the verge of doing something very, very historic,” Trump said, according to a GOP source.
Vice President Pence was also on the call, the GOP source noted. http://bit.ly/2yEnDrh.
Happy Monday and welcome back to Overnight Finance. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.
On tap tomorrow
House Financial Services Committee: Hearing entitled “The Federal Government’s Role in the Insurance Industry,” 10 a.m.
Senate Banking Committee: Hearing on the nominations of David Ryder to be Director of the United States Mint; Hester Peirce to be a member of the Securities and Exchange Commission; and Robert J. Jackson, Jr. to be a member of the Securities and Exchange Commission, 10 a.m.
Trump ‘very, very close’ to picking Fed chair: President Trump said Monday he is “very, very close” to choosing his nominee for chairman of the Federal Reserve.
Trump responded to a question from a reporter during a meeting with Singapore Prime Minister Lee Hsien Loong in the Oval Office. He did not elaborate on his timeline or discuss whom he will pick to lead the central bank.
The president said in a recent interview with the Fox Business Network he is considering Federal Reserve Governor Jerome Powell, Stanford University economist John Taylor and Janet Yellen, the current Fed chair.
“Well as you know, I’ve been seeing a number of people, and most people are saying it’s down to two — Mr. Taylor, Mr. Powell,” Trump said on Fox Business Network. “I also met with Janet Yellen who I like a lot, I really like her a lot. So I have three people I’m looking at, and there are a couple of others.”
White House press secretary Sarah Huckabee Sanders said on Friday that Trump is considering nominating Powell and Taylor to the top two positions on the board, and that an announcement on the matter will come soon
Yellen’s term expires in February.
Trump: Boeing deal with Singapore will create 70K US jobs: President Trump emphasized Monday that a new Boeing deal with Singapore International Airlines will create 70,000 jobs in the U.S.
“Otherwise we’ll cancel the order,” Trump joked, according to pool reports.
During a White House event with Singapore’s prime minister on Monday, Boeing Co. signed a previously announced $13.8 billion deal to sell 39 aircraft to Singapore International Airlines.
Trump and Singapore’s Prime Minister Lee Hsien Loong joined Singapore Airlines CEO Goh Choon Phong and Boeing Executive Vice President Kevin McAllister for the sales contract signing, which took place in the Roosevelt Room.
“One of the things we’ll be doing in a short period time is signing, together, a very large contract where Singapore is buying billions of dollars’ worth of airplanes from Boeing that will be made in our country. So that’s jobs,” Trump reportedly said. “And you’re also buying the best plane, by the way. So that’s very good.” http://bit.ly/2zK69Y5
Disaster relief bill clears major Senate hurdle: A House-passed bill aimed at helping communities impacted by a string of recent natural disasters cleared a key hurdle in the Senate on Monday evening.
Senators voted 79-16 to advance on the bill, setting up a final vote as soon as Tuesday.
All of the 16 “no” votes came from GOP senators, including Sens. Mike Lee (R-Utah) and Rand Paul (R-Ky.). The House bill would provide $36.5 billion to fund hurricane relief, a flood insurance program and wildfire recovery efforts in the West.
That includes $18.7 billion for the Federal Emergency Management Agency’s disaster relief fund, $16 billion to address national flood insurance program debt and $576.5 million for wildfire recovery efforts. It also provided $1.27 billion for disaster food assistance for Puerto Rico.
Senate Dem refutes Mnuchin: You can make a tax plan without helping the rich: Sen. Heidi Heitkamp (D-N.D.) early Monday refuted Treasury Secretary Steven Mnuchin’s claim that it is difficult to slash taxes without helping the wealthy.
“When … Secretary Mnuchin said there’s no way you can give a tax break to the middle class without advantaging the rich — that’s not true. I could do a tax credit to just those earners,” Heitkamp told CNBC’s “Squawk Box.”
Mnuchin had argued during an interview with Politico last week that “cutting taxes across the board” makes it difficult not to trim taxes for wealthy Americans.
“The top 20 percent of the people pay 95 percent of the taxes. The top 10 percent of the people pay 81 percent of the taxes,” Mnuchin said. “So when you’re cutting taxes across the board, it’s very hard not to give tax cuts to the wealthy with tax cuts to the middle class.” http://bit.ly/2yEoBUr.
Amazon receives 238 proposals for second headquarters: Amazon announced Monday that it had received 238 proposals from local officials across North America for its second headquarters in North America.
Jurisdictions have been scrambling to entice Amazon with massive tax breaks to attract the $5 billion in construction investments and 50,000 jobs that would come with the proposed campus.
The deadline for cities to submit their pitches passed earlier this month: http://bit.ly/2yDwauy.
AT&T, Time Warner extend merger deadline amid pending DOJ approval: AT&T and Time Warner are extending the deadline for their pending merger as they wait for approval from the Department of Justice.
Both companies agreed to an extension “for a short period of time to facilitate obtaining final regulatory approval required to close the merger,” according to a filing AT&T made with the Securities and Exchange Commission on Monday.
The $85 billion deal had received approval on Wednesday from Brazil, one of the last countries AT&T and Time Warner need to complete the deal. The deal has already been cleared by regulators in Mexico, Chile and Europe.
AT&T still expects the deal to be completed by the end of the year but is waiting to receive clearance from the Justice Department. Experts say the agency is likely to approve the deal because of its tendency to clear vertical mergers between companies in different industries. http://bit.ly/2yEs6dA.
Op-Eds from The Hill’s Contributors:
“A trade deal in distress: It’s time to save NAFTA,” By Perrin Beatty, Maria Fernanda Garza and Peter Robinson
“Deficit-ballooning tax cut is a singularly bad idea,” By Desmond Lachman
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