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JT TAYLOR: CAPITAL BRIEF - JT   Potomac banner 2

A BIPARTISAN APPROACH?: As the Administration starts taking measures into its own hands, don’t count out Republican Senators just yet. President Trump is weighing the option of withholding payments to insurance companies and Members of Congress, which would implode Obamacare. He responded to last week’s failed attempt at health care reform by asking Senators not to give up and met with Senator Lindsey Graham (R-SC) about the Cassidy-Graham-Heller bill that would send federal funding to the states. The measure is intended to gain bipartisan support from Congress and a group of governors who have been vocal in the health care fight, led by Senator Bill Cassidy (R-LA) who huddled with some of those governors and HHS Secretary Tom Price last night at the White House to discuss a path forward.

THE AMERICAN DREAM: The Administration’s tactical approach to tax reform is moving into its lobbying phase. The big six began by listening to as many interested parties as possible and then drafted a unified outline for tax reform - which they hope to complete by November. Unlike health care, this should be more fertile and familiar terrain for Trump and his top lieutenants. A high point of contention for them has been the barriers to starting a small business from a complicated tax code. Today's White House event will focus on small business policy and will kick off a country wide campaign from the Administration advocating a major tax overhaul.

TRADE WOES: Last night was the deadline for commentary on trade “violations and abuses” as part of an investigation ordered by President Trump. Anyone could submit comments to the U.S. Trade Representative (USTR) to help Trump determine how the World Trade Organization (WTO) and bilateral and regional free trade agreements are affecting the U.S. economy. The USTR’s inquiry report is due at the end of October, but other trade reports have been weeks late. The responses have been heated and mostly directed at the WTO, an organization that the president himself has pulled away from and was highly critical of during his campaign.

CHINA TRADE CLOCK TICKS: President Trump went on a twitter tirade last weekend with regard to China’s trade deficit, implying the Administration would take action, “we will no longer let this continue.” This came a week after he told the Wall Street Journal that he needed to get through other agenda items before discussing trade quotas or tariffs on Chinese steel. The study that the USTR and Commerce Secretary Wilbur Ross are producing on China’s steel and aluminum was due on June 30th and, once it hits Trump’s desk, he is expected to make an immediate decision on import restrictions (as soon as today). We laid out what to expect from Washington on trade policy, get the full analysis here.

SLAPPING ON SANCTIONS: Treasury Secretary Steven Mnuchin’s statement that “[the] illegitimate elections confirm that Maduro is a dictator who disregards the will of the Venezuelan people” ushered in the Administration’s calibrated approach to the burgeoning crisis by restricting all of Maduro’s assets in U.S. jurisdictions and preventing any U.S. citizens from dealing with him directly. Investors are closely watching the Administration's next move after Mnuchin said they are weighing all options - which include energy sanctions that could disrupt oil markets and the U.S. refining industry. Our senior Energy Analyst Joseph McMonigle wrote about what’s next for Venezuela energy sanctions and their implications, read the full piece here.

EVENT | HEALTHCARE: MONTHLY UPDATE:  Our Senior Health Policy Analyst Emily Evans is hosting a presentation on health care. Get the event details here.

IT IS IRF (AND SNF) DAY! CMS FINALIZES ANNUAL PAYMENT UPDATE AS EXPECTED: Our Senior Health Policy Analyst Emily Evans wrote that the Congressional 1% update override takes a lot of the excitement out of this year's rules. Action is with SNF payment system changes. Read the full piece here.

SPRINT/T-MOBILE: THE REGULATORY PROSPECTS (S, TMUS, CHTR, CMCSA, VZ, T): Our Senior Telecom Analyst Paul Glenchur writes cable and wireless convergence is the story du jour, but Sprint/T-Mobile is still on the table with reasonable regulatory prospects. Read his full piece here.