On The Money: Lawmakers hammer Zuckerberg over Facebook controversies | GOP chair expects another funding stopgap | Senate rejects Dem measure on SALT deduction cap workarounds

On The Money: Lawmakers hammer Zuckerberg over Facebook controversies | GOP chair expects another funding stopgap | Senate rejects Dem measure on SALT deduction cap workarounds
© Aaron Schwartz

Happy Wednesday 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-- Libra in limbo as lawmakers hammer Zuckerberg over Facebook controversies: Facebook CEO Mark ZuckerbergMark Elliot ZuckerbergHillicon Valley: Senate panel advances bill targeting online child sexual abuse | Trump administration awards tech group contract to build 'virtual' wall | Advocacy groups urge Congress to ban facial recognition technologies Facebook to launch Fourth of July voter registration drive Hillicon Valley: Facebook claims it 'does not profit from hate' in open letter | Analysis finds most of Facebook's top advertisers have not joined boycott | Research finds Uighurs targeted by Chinese spyware as part of surveillance campaign MORE on Wednesday fielded sharp criticism and tough questions about nearly all aspects of his company's business practices at a hearing about Facebook's new cryptocurrency project Libra.

The aggressive questioning underlined how difficult it will be for the Libra project to move past the baggage of Facebook's various controversies, which have angered lawmakers on both sides of the aisle.  

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During the House Financial Services Committee hearing, Zuckerberg found some allies in Republican lawmakers who praised the tech executive's "entrepreneurial spirit" and the "innovation" of the Libra coin.

But over the course of the day, Republicans and Democrats alike pummeled Zuckerberg over Facebook-related issues, including:

  • The continued presence of hate groups on the platform, 
  • The company's struggles to stave off foreign election interference, 
  • Its policies on disinformation, 
  • How the company treats its content moderators,
  • And why it hopes to move into the financial services space when it is already facing intensifying scrutiny of its market dominance.

"You have opened up a serious discussion about whether Facebook should be broken up," said Rep. Maxine WatersMaxine Moore WatersOn The Money: Mnuchin, Powell differ over how soon economy will recover | Millions fear eviction without more aid from Congress | IRS chief pledges to work on tax code's role in racial wealth disparities Millions fear eviction without more aid from Congress House approves statehood for DC in 232-180 vote MORE (D-Calif.), chairwoman of the House Financial Services Committee.

The Hill's Emily Birnbaum and I take you there.

 

How Zuckerberg handled the heat: 

  • Zuckerberg remained serious and reserved throughout the six-hour hearing, and even seemed aggravated during particularly rough lines of questioning as the day wore on. 
  • Zuckerberg offered a staunch defense of the controversial cryptocurrency project, which has faced skepticism and pushback from regulators around the world since Facebook announced its plans over the summer. He said the cryptocurrency project could help bring financial services into the hands of billions of people worldwide.

"We've faced a lot of issues over the past few years," Zuckerberg conceded. "I'm sure there are a lot of people who wish it was anyone but Facebook who is helping to put this forward." 

"But there's a reason we care about this," he continued. "Facebook is about putting power in peoples' hands."

 

Reactions:

  • "I think we should advance. I think we should seek innovation. I'm not opposed to some of the things that you're trying to do," said Rep. Barry Loudermilk (R-Ga.). "I'm gravely, gravely concerned about the implications they may have."
  • "I actually don't know if Libra is actually going to work," Zuckerberg said. 

 

And to recap the hearing, check out our live blog on Zuckerberg's testimony

 

ON TAP TOMORROW:

 

LEADING THE DAY

GOP chairman expects another funding stopgap, potentially through March: Senate Appropriations Chairman Richard ShelbyRichard Craig ShelbyFights over police reform, COVID-19 delay Senate appropriations markups Trump's push for major infrastructure bill faces GOP opposition Watchdogs express concern to lawmakers about ability to oversee coronavirus relief funds MORE (R-Ala.) on Wednesday said that deadlock over spending negotiations would likely require Congress to pass a new funding stopgap measure, called a continuing resolution, to prevent a shutdown after Nov. 21.

"Unless a miracle happens around here with the House and Senate, we will have to put forth another CR," Shelby said.  

  • While the House has passed 10 of its 12 annual spending bills, the Senate has not yet succeeded in passing a single funding bill, largely due to disagreements over Trump's proposed border wall.
  • On Tuesday, the Senate introduced a package of four smaller, non-controversial spending bills and is expected to begin the process of voting on amendments next week.

Unlike the eight-week stopgap that extended funding past the start of the fiscal year on Oct. 1, Shelby said that rumors of a longer CR into February or March were "probably in the ballpark."

The Hill's Niv Elis explains why here.

 

Senate rejects Dem measure on SALT workarounds: The Senate on Wednesday rejected a Democratic effort to overturn IRS regulations blocking workarounds to a portion of President TrumpDonald John TrumpSecret Service members who helped organize Pence Arizona trip test positive for COVID-19: report Trump administration planning pandemic office at the State Department: report Iran releases photo of damaged nuclear fuel production site: report MORE's tax law that is disliked by high-tax states.

The Senate voted against the Democrats' resolution, introduced by Minority Leader Charles SchumerChuck SchumerRepublicans fear backlash over Trump's threatened veto on Confederate names Overnight Defense: House panel votes to ban Confederate flag on all Pentagon property | DOD report says Russia working to speed US withdrawal from Afghanistan | 'Gang of Eight' to get briefing on bounties Thursday Top intelligence officials to brief Gang of Eight on Thursday MORE (D-N.Y.), by a vote of 43-52. It was a mostly party-line vote, with Sen. Michael BennetMichael Farrand BennetHouse Democrats chart course to 'solving the climate crisis' by 2050 'The Senate could certainly use a pastor': Georgia Democrat seeks to seize 'moral moment' Some realistic solutions for income inequality MORE (Colo.), a 2020 presidential candidate, the only Democrat to vote against the resolution and Sen. Rand PaulRandal (Rand) Howard PaulGOP Arizona lawmaker says Fauci and Birx 'undermine' Trump's coronavirus response Fauci: 'We are not going in the right direction' FBI says Breonna Taylor case is 'top priority' for Louisville agents MORE (Ky.) the only Republican to vote in favor.

While Democrats' effort was unsuccessful, it is notable because it's the first time they forced a vote to overturn IRS rules relating to Trump's tax law. The vote highlights how Democrats from high-tax states -- such as New York, New Jersey and California -- view the tax law's cap on the state and local tax (SALT) deduction as a top priority and the challenges they face in doing away with it.

"As bad as the Trump tax bill is for the whole country, it's even worse for states like New Jersey," Sen. Bob MenendezRobert (Bob) MenendezSenate Dems request briefing on Russian bounty wire transfers Democratic senator proposes sanctions against Putin over bounties GOP lawmakers voice support for Israeli plan to annex areas in West Bank MORE (D-N.J.) said on the Senate floor ahead of the vote.

The details: The tax law Trump signed in December 2017 imposed a cap on the SALT deduction of $10,000.

Republicans capped the deduction in order to raise revenue to pay for tax cuts elsewhere in the law, and because they viewed the deduction as subsidizing higher state taxes. They have noted that analysts have estimated that most people got a tax cut for 2018 under Trump's law, even in high-tax states.

But efforts to repeal the SALT deduction cap have also faced criticism among progressives, because analysts across the ideological spectrum have estimated that repealing the SALT deduction cap would primarily benefit high-income taxpayers.

The Hill's Naomi Jagoda has more on the vote and the complicated politics here.

 

House committee advances measure taxing nicotine in vaping products: The House Ways and Means Committee approved legislation Wednesday that would impose a federal tax on the nicotine used in liquid vaping products.

The panel approved the measure in a mostly party-line vote of 24 to 15, with Rep. Lloyd DoggettLloyd Alton DoggettGilead sets price for five-day coronavirus treatment at ,120 The Hill's Coronavirus Report: Rep. Mark Takano says Congress must extend worker benefits expiring in July; WHO reports record spike in global cases Exclusive investigation on the coronavirus pandemic: Where was Congress? MORE (D-Texas) voting present. Two Republicans, Reps. Tom RiceHugh (Tom) Thompson RiceHouse GOP lawmakers defy new mask requirement Pelosi asks House chairs to enforce mandatory mask-wearing during hearings House GOP lawmaker tests positive for COVID-19 MORE (S.C.) and Vern BuchananVernon Gale BuchananMORE (Fla.), voted with Democrats, while Rep. Stephanie MurphyStephanie MurphyModerate House Democrats introduce bill aimed at stopping China from exploiting coronavirus pandemic Encouraging a safe business environment can help drive America's recovery The Hill's Coronavirus Report: Former Rep. Delaney says Trump is spewing venom when he should be leading; Protests roil the nation as fears of new virus outbreaks grow MORE (D-Fla.) joined Republicans in opposing the measure.

The move comes amid growing concerns over the health effects of vaping, as a respiratory illness linked to vaping products spreads across the country.

"A whole generation of our children are getting addicted to nicotine" through the use of vaping products, said Rep. Tom Suozzi (D-N.Y.) said at Wednesday's markup. "For young people especially, who have less money and therefore higher price elasticity, taxes on vaping products are an effective way to decrease usage."

The Hill's Naomi Jagoda has more here.

 

GOOD TO KNOW

  • An attorney for President Trump told a federal appeals court Wednesday that Trump could not be prosecuted even if he shot someone on Fifth Avenue in New York amid a legal fight over his financial records that seems destined for the Supreme Court.
  • President Trump announced Wednesday that his administration would lift sanctions on Turkey after Ankara agreed to stop an offensive in northern Syria and agreed to a permanent cease-fire. 
  • Unemployment may be hovering near a 50-year low, but only 40 percent of America's workers say in a new survey that they are working in "good" jobs.

 

ODDS AND ENDS