On The Money: Senators propose ‘crushing’ Russia sanctions | Trump calls for food stamp work requirements in farm bill | China tells US to ‘chill’ on trade | Apple hits $1 trillion in value
Happy Thursday and welcome back to On The Money. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.
THE BIG DEAL: A bipartisan group of senators is introducing legislation to impose “crushing” new financial penalties on Russia.
The bill would slap new sanctions on Moscow, require two-thirds Senate approval if President Trump wanted to withdraw from NATO and force the State Department to determine if Russia is a state sponsor of terrorism.
GOP Sen. Lindsey Graham (S.C.) said current U.S. sanctions against Russia haven’t stopped Moscow from trying to meddle in the November midterm elections, despite Congress passing new legislation last year.
“Our goal is to change the status quo and impose crushing sanctions and other measures against [President Vladimir] Putin’s Russia until he ceases and desists meddling in the US electoral process, halts cyber-attacks on US infrastructure, removes Russia from Ukraine, and ceases efforts to create chaos in Syria,” he said in a statement. The Hill’s Jordain Carney has more on the sanctions here.
What’s going on?
- The proposal comes as lawmakers are increasingly concerned that Russia will try to interfere in the 2018 elections, where control of Congress hangs in the balance.
- But senators have struggled to coalesce behind any one measure in the lead-up to the election. And resolutions that would give the Senate’s support to the intelligence community’s finding that Russia meddled in the 2016 election have routinely been blocked.
What the sanctions would do:
- The new financial penalties would target political figures, oligarchs, family members and others that “facilitate illicit and corrupt activities” on behalf of Putin.
- It would also impose new sanctions on transactions tied to investments in state-owned energy projects, transactions tied to new Russian debt, and people with the capacity or ability to support or carry out a “malicious” cyber act.
- The legislation would also create a State Department office of cyberspace and the digital economy, create a national fusion center to respond to hybrid threats and reauthorize the countering Russia influence fund.
- It would also fold in legislation that allows the Justice Department to pursue charges for those caught hacking a voting system that is used in a federal election and require a report on the net worth and assets of Putin.
Keep an eye on this: The bill also includes sanctions on investments in Russian state-owned energy projects, certain oil production activities in Russia and trading new Russian sovereign debt. That could get a little tricky.
As I wrote last week, further sanctions on Russia’s debt and energy and financial sectors could create severe economic consequences that could potentially affect the U.S.
Lawmakers scrapped planned sanctions on Russian oil last year after U.S. drillers and refineries expressed concerns that the provisions could halt American projects abroad. Treasury also warned lawmakers in February that further sanctions on Russia’s debt or financial markets could devastate its economy so badly that they could provoke a military response from the Kremlin.
What comes next:
- The chairmen of the Senate Banking and Foreign Relations committees both agreed to hold hearings on further Russia sanctions, and could do so within the next few weeks.
- The Trump administration has also shown a growing sense of urgency about potential election interference, and is stepping up their response to alleged Russian hacking efforts. We’ll see if further sanctions play a role in that effort.
ON TAP TOMORROW
- July jobs report released, 8:30 a.m.
LEADING THE DAY
Trump calls for food stamp work requirements in farm bill: President Trump on Thursday urged House and Senate lawmakers to adopt strict work requirements for food stamps when they craft a merged farm bill.
“When the House and Senate meet on the very important Farm Bill – we love our farmers – hopefully they will be able to leave the WORK REQUIREMENTS FOR FOOD STAMPS PROVISION that the House approved,” Trump tweeted. “Senate should go to 51 votes!”
Both the House and Senate passed their respective farm bills in June. However, the House bill imposes new work requirements on the food stamps program and tightens overall eligibility on who can qualify for the federal assistance.
Conservatives have seized on the work requirement provisions as key to a final version of the farm bill. The Hill’s Nathaniel Weixel explains the conflict here.
Wilbur Ross brushes off harm of Trump tariffs: Commerce Secretary Wilbur Ross on Thursday defended the Trump administration’s latest threat to ramp up tariffs on China, saying it would not lead to disaster for the U.S. economy.
“It’s not something that’s going to be cataclysmic,” he said in an interview with Fox Business Network.
The comments came one day after the Trump administration announced it is considering raising planned tariffs on $200 billion of Chinese imports to 25 percent from 10 percent, a sharp increase that could fuel a trade war between the world’s two largest economies.
Ross sought to soothe those concerns, saying a 25 percent tariff would only amount to $50 billion, or only a fraction of 1 percent of the Chinese economy.
The Commerce secretary said Trump believes additional tariffs are needed because China has refused to “modify their behavior” in response to an initial round of tariffs and other U.S. economic sanctions. The Hill’s Vicki Needham tells us why here.
Meanwhile, China’s top diplomat on Thursday encouraged the Trump administration to “calm down” amid escalating tariff threats, saying increased rhetoric will not lead to results.
Wang Yi said at a forum in Singapore that a U.S. campaign to ratchet up pressure on Beijing will not “have any effect,” Reuters reported. “We hope that those directly involved in the United States’ trade policies can calm down, carefully listen to the voices of U.S. consumers … and hear the collective call of the international community.”
MARKET CHECK: CNBC: “The S&P 500 and Nasdaq Composite rose on Thursday as Apple became the first U.S. publicly traded company in history to reach $1 trillion in market value.
“The S&P 500 advanced 0.5 percent to 2,827.22, while the tech-heavy Nasdaq jumped 1.2 percent to 7,802.69. The Dow Jones Industrial Average closed just 7.66 points lower at 25,326.16, nearly erasing a 200-point loss.”
More on Apple becoming the first U.S. company to hit the $1 trillion value mark here.
GOOD TO KNOW
- Sen. Marco Rubio (R-Fla.) on Thursday rolled out legislation to create a paid parental leave benefit, furthering a push from Republicans to take action on the topic.
- Fewer than a third of Americans think the North American Free Trade Agreement (NAFTA) is good for the country, according to a new study that comes as the Trump administration pushes to renegotiate the free trade deal with Canada and Mexico.
- Chippewa Valley Bean Co. was on track to ship 60 percent of its beans ($25 million) traded internationally this year to Europe. Now, 80 shipping containers’ worth of kidney beans, valued at a total of $2 million, are stuck in its warehouses as orders from Europe dry up, according to The Wall Street Journal.
- The Securities and Exchange Commission is boosting its scrutiny of brokerages that deal in cryptocurrencies, according to Bloomberg News.
- ZTE loaded up with powerful Washington lobbyists to convince lawmakers to abandon penalties that would have decimated the Chinese telecom company, according to The New York Times.
- Commerce Secretary Wilbur Ross and Sen. Chris Coons (D-Del.) touted a bipartisan plan backed by the White House to revamp U.S. foreign aid as a crucial tool to fight Chinese influence in Africa in a CNBC op-ed.
ODDS AND ENDS