AMERICA’S ADDICTION: President Trump’s choice to declare the opioid epidemic a national health emergency instead of declaring it a national disaster will change the type of resources dispersed. A national health emergency is usually used for diseases and thus spreads access to medical care into rural areas, streamlines bureaucratic resources and approvals, and can potentially increase federal funding. It does not, however, give the government the ability to tap federal emergency funds the way a national disaster does. Opioid deaths continue to rise, killing over 64,000 Americans in 2016 alone. The crisis starts at the local level and will require the participation of doctors and the pharmaceutical industry. Some States have filed lawsuits against pharmaceuticals for their role in the epidemic. See how the disease has swept the nation:
Source: New York Times
THE MEANS TO TAX: Clearing a major hurdle to tax reform, the House passed the Senate-approved budget and with it reconciliation instructions that unlock the ability to pass a package with a simple majority. It went down to the wire as Republican Representatives from high tax states, especially New York and New Jersey, launched a protest vote against House Ways and Means Chair Kevin Brady after failing to make a deal with him on State and local tax deductions (SALT). Those Representatives wanted assurances before the budget vote that SALT deductions would not be eliminated once tax reform work commenced. The same crew headed to Brady’s office after the vote to work on a deal and left empty-handed. The Budget Resolution was a huge undertaking - considering they were able to get conservative factions of the House to vote for $1.5 Trillion in tax cuts without their cherished spending cuts. For more on SALT, read our analysis here.
BRADY PAVES THE WAY: After the budget vote, Chairman Brady laid out the path forward for tax reform.
- House Ways and Means will release draft November 1st
- House Ways and Means will begin markup week of November 6th
- House will vote on the tax package week of November 13th
- Senate Finance will markup tax package week of November 13th
- Senate will debate weeks of November 27th and December 4th
- Senate will finish tax bill week of December 11th
- The Chambers will conference weeks of December 11th and 18th
- White House signing ceremony before the end of the year?
TAKE A HIKE: Republicans historically loathe to add to the deficit - making votes for tax cuts, disaster relief, the border wall, and other funding very difficult, but they haven’t even gotten to the most expensive ticket item. President Trump plans on a $1 Trillion infrastructure package and needs a way to pay for it outside of government debt. His chief economic Adviser Gary Cohn says they are weighing the potential of a gasoline tax. After he met with the Problem Solvers Caucus - a bipartisan group of Representatives - Cohn said there was real interest in a gas tax hike as fuel prices remain low as a result of suppressed oil and natural gas prices. However, Republicans hate voting for a tax hike as much as a debt ceiling hike leaving them with few alternatives to cover the cost of new roads, bridges, and airports.
TREASURY’S TAKE: A report from the Treasury Department lays out recommended changes to the way federal agencies regulate insurance companies. Under Dodd-Frank, insurance companies are subject to different levels of scrutiny based on size, but Treasury Secretary Steve Mnuchin believes it should have more to do with their risky activity instead. If Congress agrees, they will have to revisit aspects of the landmark Dodd-Frank legislation. The report finds that size has little to do with risk to the financial system and that the same was true during the 2008 financial crisis that led to the current regulatory landscape.
ANNOUNCING OUR NEW LEGAL CATALYSTS VERTICAL WITH PAUL GLENCHUR: We are pleased to announce the launch of our new Legal Catalysts vertical, highlighting key cases and legal developments with significant potential impact across multiple sectors. Paul Glenchur, our longtime telecom and media analyst, but also a former federal appellate court law clerk, attorney, and member of the Supreme Court Bar, will lead this research offering. Check it out here.
FCC RELAXATION OF MEDIA OWNERSHIP LIMITS (SBGI, TRCO, NXST, TGNA, FOXA): Our Senior Telecom Analyst Paul Glenchur writes that as expected, the Republican-controlled FCC is easing media ownership limits, updating its rules for the digital age. Read the full piece here.
FERC COMMENT PERIOD ENDS ON DOE PROPOSAL TO AID COAL & NUCLEAR: Our Senior Energy Analyst Joe McMonigle writes that we believe FERC is open to the DOE proposal, but is likely to extend consideration by months. Similar FERC action would be closer to March 2018. Read the full piece here.
EPA REVERSES COURSE ON RFS & RINS POLICY AFTER IOWA HOSTAGE TAKING: Our Senior Energy Analyst Joe McMonigle writes that Iowa Senators blocked an EPA nominee and Trump caved on biofuels policy, but an EPA letter providing assurances also raises litigation risk. Read the full piece here.
NOC BEGINS TO SHOW IMPACT OF BOMBER AND GBSD WINS: Our Senior Defense Analyst Emo Gardner writes that NOC is the dog that caught two cars with an $80B bomber contract and this year's ICBM Tech Maturation downselect. It must focus on execution. Read the full piece here.
