Happy Friday and welcome back to On The Money, where we’re wondering how many questions about Dodd-Frank we’ll get in the first Democratic primary debate. 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–DOJ releases legal opinion backing Treasury’s refusal to release Trump tax returns. The Department of Justice (DOJ) on Friday released a legal opinion backing up the Treasury Department’s decision to reject a request by congressional Democrats for six years of President Trump’s tax returns.
“While the Executive Branch should accord due deference and respect to congressional requests, Treasury was not obliged to accept the Committee’s stated purpose without question, and based on all the facts and circumstances, we agreed that the Committee lacked a legitimate legislative purpose for its request,” Steven Engel, an assistant attorney general in DOJ’s Office of Legal Counsel, said in the 33-page opinion.
Timing: The opinion comes after Treasury Secretary Steven Mnuchin last month rejected a subpoena from House Ways and Means Committee Chairman Richard Neal (D-Mass.) demanding Trump’s personal and business tax returns from 2013 through 2018.{mosads}
When Mnuchin rejected Neal’s request, he said he did so upon the advice of DOJ, and that the Justice Department would publish a legal opinion with its advice.
What’s next? Both Mnuchin and Neal have said they expect the tax-return issue to end up in the courts.
The Hill’s Naomi Jagoda breaks down the DOJ’s reasoning here.
LEADING THE DAY
Centrist Democrats raise concerns over $15 minimum wage push: House Democrats are moving forward with legislation that would raise the federal minimum wage to $15 per hour, despite concerns from centrist lawmakers about the impact on lower-cost areas.
Democratic leaders say they’re close to clinching the 218 votes needed to pass the bill, which they expect to bring to the floor in July.
Raising the minimum wage has been a staple of Democratic policy for years. But Congress has only voted twice in the past two decades to increase the minimum wage, and it has been stagnant at its current rate since 2009.
That might change soon.
All but 29 of the 235 House Democrats have cosponsored the measure, arguing it is key to helping workers and reducing poverty, while also lowering dependence on government welfare programs.
Other Democrats aren’t sold. Many of the holdouts are moderates who are concerned that a significant wage boost in a short period of time could have an unintended effect in more rural settings. They argue that in a country as economically diverse as the United States, an across-the-board base wage doesn’t make sense.
The Hill’s Cristina Marcos and Niv Elis tell us more here.
Reactions:
- “The minimum wage in San Francisco should probably be $30 an hour, OK? But the minimum wage in West Virginia or Arkansas is a different story,” said freshman Rep. Jeff Van Drew (D-N.J.), whose state recently moved to raise the minimum wage to $15 by 2024.
- “Every time we’ve raised the minimum wage in Wisconsin, we’ve had more people enter the job market and businesses have done fine,” said Rep. Mark Pocan (D-Wis.).
Trump bashes Powell, says he’s ‘waited long enough’ for rate cut: President Trump escalated his criticism of Federal Reserve Chairman Jerome Powell in an interview that aired Friday, saying he’s “waited long enough” for the Fed to cut interest rates.
In an interview with ABC’s George Stephanopoulos, filmed Tuesday, the president again accused Powell of holding back the economy from its full potential through interest rate hikes and bond sales meant to stave off inflation.
“He’s my pick,” Trump said. “And I disagree with him entirely.”
Trump argued that the U.S. economy and stock market would have grown faster “if we had a different person in the Federal Reserve that wouldn’t have raised interest rates so much.”
“It’s OK to raise interest rates a little bit,” Trump said. “But so much … it would have been even better.”
Crucial moment: Powell has brushed off Trump’s criticism, insisting that politics play no role in the Fed’s decisionmaking. But the president’s latest attack intensifies the spotlight on the Fed as it weighs whether to cut interest rates.
Fed officials have expressed concern over the persistence of inflation below the central bank’s 2 percent target and the rising costs of Trump’s trade battles with China, the European Union, Mexico, Canada and Japan.
Powell said last week that the Fed “will act as appropriate to sustain the expansion” as inflation remains low and the economy faces headwinds abroad. Analysts and investors saw Powell’s comments as a nod to an impending rate cut following months of the chairman stressing the bank’s “patient” approach to moving rates.
What comes next: The Fed’s policymaking arm, the Federal Open Markets Committee, will meet Tuesday and Wednesday for its monthly huddle. While the Fed is not expected to cut rates next week, Powell’s press conference and the committee’s statement may shed light on the central bank’s next moves.
Design leaks for Harriet Tubman $20 bill after Mnuchin announces delay: The preliminary design for an updated $20 bill featuring Harriet Tubman was revealed by The New York Times on Friday, after Treasury Secretary Steven Mnuchin announced last month that a redesign will be delayed until 2028.
The design was reportedly completed in late 2016. The Obama administration had set a 2020 deadline for finishing the design before Mnuchin pushed that deadline back.
A spokeswoman for the bureau, Lydia Washington, confirmed to the Times that preliminary designs of the new note were created as part of research that was done on orders from former Treasury Secretary Jacob Lew.
ON TAP NEXT WEEK
Tuesday:
- U.S. Trade Representative Robert Lighthizer testifies before the Senate Finance Committee on the administration’s trade policy, 10:15 a.m.
- The Senate Banking Committee votes on six nominations to the Federal Reserve Board, Treasury Department, Commerce Department, Securities and Exchange Commission, and Export-Import Bank, followed by a hearing on Terrorism Risk Insurance Act reauthorization, 10:15 a.m.
Wednesday:
- U.S. Trade Representative Robert Lighthizer testifies before the House Ways and Means Committee on the administration’s trade policy, 9:30 a.m.
- A House Financial Services subcommittee holds a hearing on the economic impact of Trump administration tax and trade policies, 10 a.m.
- The Senate Judiciary Committee holds a hearing entitled “Combating Kleptocracy: Beneficial Ownership, Money Laundering, and Other Reforms,” 10 a.m.
- A House Financial Services subcommittee holds a hearing on proposals to strengthen securities law enforcement, 2 p.m.
- The Senate Budget Committee holds a hearing entitled “Fixing a Broken Budget and Spending Process: Lessons from States,” 2:30 p.m.
- A House Ways and Means Subcommittee holds a hearing entitled “Ending the TCJA Tax on Houses of Worship, Charities, and Nonprofits,”
Thursday:
- The House Financial Services Committee holds a hearing on increasing corporate boardroom diversity, 10 a.m.
- The Senate Banking Committee holds a hearing entitled “Outside Perspectives on the Collection of Beneficial Ownership Information
GOOD TO KNOW
- Ivanka Trump, the president’s daughter and adviser, made about $4 million last year from her investment in the Trump International Hotel in Washington, D.C., according to a newly released financial disclosure form.
- President Trump on Friday changed his tune on the importance of meeting with Chinese President Xi Jinping at the upcoming Group of 20 (G-20) summit, saying “it doesn’t matter” if Xi shows up.
- India intends to impose tariffs on 29 U.S. products starting Sunday after deferring the duties several times since they were first announced in 2018.
- Acting White House budget director Russell Vought is accusing Speaker Nancy Pelosi (D-Calif.) of risking a national default by insisting that a deal on spending caps be linked to legislation to raise the debt ceiling.
- Reuters explains how “an Obama Fed appointee is scuttling Wall Street’s bid to ease rules.”
ODDS AND ENDS
- President Trump on Friday touted new actions meant to expand health care choices for small businesses, part of a larger effort to loosen health care regulations.
- Democrats are pushing the Puerto Rican government to reject a debt resettlement deal with the island’s power company, arguing that it will increase Puerto Ricans’ electric bills and stymie development of renewable energy.