On The Money: Trump inches toward emergency declaration | Eyes disaster bill for wall funds | Trump promises to pay federal workers after shutdown | Fed chief warns long shutdown could hurt economy | China sees progress in trade talks

On The Money: Trump inches toward emergency declaration | Eyes disaster bill for wall funds | Trump promises to pay federal workers after shutdown | Fed chief warns long shutdown could hurt economy | China sees progress in trade talks

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.

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THE BIG DEAL--Trump inches toward emergency declaration for wall as immigration talks collapse: President TrumpDonald John TrumpAverage tax refunds down double-digits, IRS data shows White House warns Maduro as Venezuela orders partial closure of border with Colombia Trump administration directs 1,000 more troops to Mexican border MORE on Thursday gave his strongest indication yet that he may declare a national emergency to circumvent Congress if he cannot reach a deal with Democrats on funding for his long-promised border wall.

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Trump spent most of the day near the U.S.-Mexico border in Texas, a visit many in Washington see as a precursor to an emergency declaration after talks with congressional leaders imploded the day before. 

"Well, we can declare a national emergency. We shouldn't have to because this is just common sense," Trump told reporters on the banks of the Rio Grande River, flanked by border agents and piles of plastic-wrapped drugs seized at the frontier.

But if talks don't pick back up, Trump said, "then you will see what happens with national emergency, which I can do very easily and there's no question it holds up."

 

What about the money? The White House is looking at $13.9 billion in funding approved by Congress last year as part of a disaster response bill to use for building Trump's wall in the event he declares an emergency. That bill provided funding for various Army Corps of Engineers projects that has been allocated but not spent. 

"I can tell you that's definitely an option that has been presented to the president. Nothing has been finalized yet though," said an administration official, who requested anonymity to discuss internal deliberations.

Another administration official confirmed that option is under consideration, but said other plans are also being discussed. The Hill's Jordan Fabian has the story.

 

Talks fall apart: Trump's declaration came a day after a brief but explosive White House meeting with Democratic leaders. The president stormed out of a negotiation session with House Speaker Nancy PelosiNancy Patricia D'Alesandro PelosiKids confront Feinstein over Green New Deal Can progressives govern? Dems plan hearing on emergency declaration's impact on military MORE (D-Calif.) and Charles SchumerCharles (Chuck) Ellis SchumerDon’t look for House GOP to defy Trump on border wall GOP Green New Deal stunt is a great deal for Democrats National emergency declaration — a legal fight Trump is likely to win MORE (D-N.Y.) after Pelosi rebuffed his request for border wall funding once the shutdown concluded.

 

The latest from the House: Lawmakers Thursday attempted to pave the way to reopening the government after 20 days of a partial shutdown.

  • The Democratic-led House passed a standalone bill Thursday to provide funding for the Departments of Transportation, Housing and Urban Development, and other agencies.
  • The chamber then voted to pass a separate measure to fund the Department of Agriculture and related agencies through Sept. 30, with 10 Republicans joining Democrats to vote for the measure. That's more than the 8 Republicans who voted Wednesday to fund the Treasury Department and IRS.

 

But those bills are headed for a buzzsaw in the Senate: Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellKids confront Feinstein over Green New Deal Trump selects Kelly Craft for United Nations ambassador Union leader says Green New Deal would make infrastructure bill ‘absolutely impossible’ MORE (R-Ky.) on Thursday blocked two House-passed funding bills that would reopen the federal government.

 

Immigration talks falter: Broader immigration reform talks also collapsed in the Senate after a last-ditch effort by a group of Senate Republicans to end the partial government shutdown quickly unraveled on Thursday.

After fruitless talks between Trump and congressional leadership, the moderate group was viewed as a last-ditch effort to find a negotiated solution that would avoid an emergency declaration by Trump to build the wall.

"I think we're stuck. I just don't see a pathway forward," Sen. Lindsey GrahamLindsey Olin GrahamTrump says he'll '100 percent' veto measure blocking emergency declaration Overnight Defense: Dems tee up Tuesday vote against Trump's emergency declaration | GOP expects few defections | Trump doubles number of troops staying in Syria to 400 On The Money: Dems set Tuesday vote on Trump's emergency declaration | Most Republicans expected to back Trump | Senate plots to avoid fall shutdown drama | Powell heading before Congress MORE (R-S.C.) told reporters. "I don't know who to talk to and I don't know what else to do."

Graham later called on Trump to build the wall through an emergency declaration, adding "I hope it works."

 

Trump promises to pay federal workers after shutdown: President Trump has promised Democratic Sen. Tim KaineTimothy (Tim) Michael KaineDemocrats brush off GOP 'trolling' over Green New Deal Overnight Defense: Trump declares border emergency | .6B in military construction funds to be used for wall | Trump believes Obama would have started war with North Korea | Pentagon delivers aid for Venezuelan migrants Kaine asks Shanahan if military families would be hurt by moving .6B for border wall MORE (Va.) that he will sign a bill providing backpay to federal workers once the government shutdown, which has stretched 20 days, finally ends.

The Senate passed by unanimous consent legislation Thursday evening providing that federal workers -- essential and furloughed employees -- will be paid once the shutdown is over.

Federal employees are due to miss paychecks Friday, which has caused consternation in the Washington, DC, region.

Trump made his pledge in a phone call with Senate Majority Leader Mitch McConnell (R-Ky.) as part of an effort to work out a deal to adjourn the Senate this week. The Hill's Alexander Bolton has more.

 

Fallout from the shutdown:

 

LEADING THE DAY

Fed chief Powell: Prolonged shutdown will harm US economy: Federal Reserve Chairman Jerome Powell said Thursday that the partial government shutdown could hinder the U.S. economy and the central bank's ability to keep it stable.

Powell said at the Economic Club of Washington, D.C., that a prolonged shutdown may harm the world's largest economy beyond the financial hardship facing hundreds of thousands of furloughed and "essential" federal workers who are expected to go without a paycheck this week.

The Fed chief said that while shutdowns "typically don't last very long," an extended shutdown "would show up in the data pretty clearly."

  • The shutdown is expected to break the record for the longest in U.S. history, and affected workers on Friday will miss their first paycheck since funding for about 25 percent of the federal government expired on Dec. 22.
  • The hit to personal finances could in turn result in missed mortgage payments and a failure to meet other debt payment deadlines, though Congress is expected to approve back pay for affected federal employees as part of any legislation to end the shutdown.

 

Powell said it's difficult to gauge the full economic impact of the shutdown since one of the central bank's major sources of data, the Commerce Department, is shuttered.

  • The Fed is independently funded through fees paid by banks, so it will remain open during the shutdown. But the central bank will be deprived of important economic data until Trump and Democrats reach a funding deal.
  • The Fed relies on a wide range of data from the Commerce Department, including GDP, price increases, wage growth, retail sales and international trade metrics. That leaves the central bank without a slew of important indicators that shape monetary and financial regulatory policy.

 

China sees progress on 'structural issues' in trade talks with US: The U.S. and Beijing made progress on "structural issues" during talks to resolve a trade dispute between the two countries, China's commerce ministry said on Thursday, according to Reuters.

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Ministry spokesman Gao Feng reportedly said during a news conference that the two sides made progress on issues including forced technology transfers, intellectual property, tariff barriers and cyber attacks.

Gao added that the talks between the two countries were "serious" and "honest," the news service reported.

 

GOOD TO KNOW

  • China continues to borrow billions of dollars a year from the World Bank, making it one of the bank's top borrowers. But China is also the world's second-largest economy and itself a major lender itself. A new report from the Center for Global Development looks into why.
  • The economics profession faces a billowing "crisis of sexual harassment, discrimination and bullying that women in the field say has pushed many of them to the sidelines -- or out of the field entirely," according to The New York Times.
  • The Department of Agriculture is throwing out Obama-era school nutrition standards and "tossing a lifeline to the dairy industry," according to Bloomberg News.
  • Op-Ed: "The Fed wants to be boring, but Trump, markets won't let it"
  • The S&P 500 notched its first five-day winning streak since September.

 

ODDS AND ENDS

  • A Google shareholder is suing the internet giant's founders and the board of directors for its parent company Alphabet over a $90 million severance payout made to an executive who was pushed out amid allegations of sexual misconduct.
  • Fiat Chrysler will pay almost $500 million to settle claims that the auto giant used integrated vehicle software to cheat on emissions tests, the Department of Justice (DOJ) announced Thursday.