The advancement and diffusion of knowledge is the only guardian of true liberty.
-James Madison
BAT IN THE CROSSHAIRS: With tax reform taking over as the major issue on Capitol Hill, the Border Adjustment Tax is continuing to cause angst among Republicans. House Ways and Means Chairman Kevin Brady has been pushing for the tax since the election, but many Republicans, particularly those in the Senate, believe it will either drive up consumer prices or start a trade war - and they just don’t understand how it actually works. It also doesn’t help that President Trump’s advisors are split on the issue as well with Trump not weighing in just yet. Brady has been on the receiving end of calls from the other side of the Capitol urging him to drop the BAT since it won’t pass in that body, but Brady isn’t ready to give up.
CH-CH-CH-CHANGES: All the talk of changing Senate rules has centered around Senate Majority Leader Mitch McConnell triggering the nuclear option for SCOTUS nominee Neil Gorsuch. However, there have been talks about changing Senate rules to help get many of President Trump’s appointees through the Senate. The president still needs to fill 500 key positions and needs a total of 1,200 nominations to still receive Senate confirmation. To speed up this process Senate leadership is considering changing the rules that would reduce debate time from 30 hours to eight. This is not entirely out of left field as the then Democrat-led Senate made a similar rule change back in 2013.
FACING THE FIRING SQUAD: The future of CFPB Director Richard Cordray continues to be murky even as he testified on Capitol Hill yesterday giving Republicans an opportunity to lay out their laundry list of issues against him. House Financial Services Chair Jeb Hensarling took the lead arguing that the CFPB continuously overstepped their legal and jurisdictional bounds and prized fines over consumer freedom. Republicans also took issue with the fact that some of the CFPB’s rules meant to prevent cyclical debt from payday lenders and prepaid card companies eliminated options for poorer Americans. Although he was not in the hearing room, you can bet that Hensarling’s main audience was President Trump - and we suspect we’ll know soon whether or not Republicans made a strong enough case for Trump to remove him.
FIDUCIARY RULE - REVIEW AND REVISE?: Newly-minted Secretary of Labor Alex Acosta got to work quickly delaying the implementation of the Fiduciary Rule which was slated to go into effect early next week. The rule required broker dealers to only consider their client's best interest and not fees or commissions when providing investment advice. The Administration continues to keep its word when trying to push back on what they view as overly burdensome regulations and the delay will push the rule back to June 9th giving Acosta and others more time to review and potentially alter..
As we get closer to the summer months, look for Dodd-Frank reform to heat up. Below is a chart that shows lending to consumers and businesses before and after the introduction of the controversial legislation.
FCC BOOST FOR WIRELESS DEPLOYMENT: Our Media and Telecom Analyst Paul Glenchur writes The FCC tackles local red tap problems for wireless buildouts, hoping to accelerate the 5G push. You can find the full analysis here.
