Happy Tuesday and welcome back to On The Money, where we’re a little bit jealous of our friends covering the South Carolina primary. 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–GAO launches investigation into Trump aid for farmers: The Government Accountability Office (GAO), Congress’s nonpartisan audit agency, is opening an investigation into a program providing aid to farmers hit by President Trump’s trade wars.
“It’s clear that the Trump Administration’s trade assistance payments pick winners and losers rather than help the farmers who have been hit the hardest by this president’s trade policies,” said Sen. Debbie Stabenow (Mich.), the top Democrat on the Senate Agriculture Committee, who requested the investigation last month.
“This investigation will shed more light on what has been happening, and bring accountability and fairness to a program that has spent billions of taxpayer dollars,” she added.
The Hill’s Niv Elis tells us more about the investigation here.
The details:
- The Agriculture Department (USDA) pledged $12 billion in aid in 2018 and an additional $14.5 billion in 2019.
- One study found that between disaster aid, trade aid, insurance indemnities and the trade assistance, almost 40 percent of farm income was coming from some sort of aid.
- Stabenow raised concerns that the aid distribution was being decided by political considerations, with larger payouts going to Trump-voting red states in the South. She also had questions over whether USDA’s methods for dispersing aid were preventing waste, fraud and abuse.
- USDA has also taken heat for trade-related aid payments to the subsidiary of a Brazilian corporation under criminal investigation.
LEADING THE DAY
Bloomberg calls for bolstering Obama-era financial rules, reversing past criticism: Former New York City Mayor Michael Bloomberg, a 2020 Democratic presidential candidate, proposed on Tuesday a vast expansion of financial regulations amid intense criticism over his past skepticism of Wall Street rules.
The plan would reverse the Trump administration’s loosening of post-financial crisis regulations created by the Dodd-Frank Wall Street reform law and drastically expand the power of federal financial watchdogs.
- Bloomberg, who has amassed a $64 billion fortune through his eponymous financial analysis and media company, has taken heat for his past criticism of Dodd-Frank and for blaming the 2007 housing collapse on laws intended to stop racial discrimination in lending.
- But his proposal includes several policies long supported by fierce Wall Street critics, including a financial transaction tax, the renewal of U.S. Post Office banking services and tougher restrictions on risky financial trades.
I break down the proposal here.
What’s in Bloomberg’s plan:
- The centerpiece of Bloomberg’s proposal is unwinding the Trump administration’s efforts to roll back Dodd-Frank, including stress test revisions, the rewritten Volcker Rule, and capital requirements.
- Bloomberg is proposing to work with Congress to implement a 0.1 percent tax on transactions for stocks, bonds and derivatives. He is calling for the tax to be phased in over time, starting at 0.02 percent, to limit any unintended consequences, according to a document from his campaign
- Bloomberg’s plan also calls for strengthening the Community Reinvestment Act and boosting fair lending laws, recanting his past claim that the elimination of redlining caused the 2007 housing collapse.
- Bloomberg also pledged to restore the Consumer Financial Protection Bureau (CFPB)’s initial rules to curb short-term, high-interest “payday” loans, potentially discriminatory auto loan premiums and forced arbitration between consumers and financial institutions.
- There’s a ton of other interesting or notable proposals in his plan, like the merger of Fannie and Freddie, requiring publicly traded companies to disclose climate-related risks, and bringing back the Labor Department’s “fiduciary” rule. If you read this newsletter, you’ll probably find something else that matters to you in here.
THE HILL EVENT
Thursday, February 20th: Building the Dream: Charlotte
The Hill will be in Charlotte, N.C. on Thursday, February 20th. Our editors will sit down with Charlotte Mayor Vi Lyles, Rep. Alma Adams (D-N.C.), state Sen. Paul Newton (R) and others to discuss financial hurdles to homeownership. Join us live in Charlotte or join the livestream.
GOOD TO KNOW
- The Hill’s Naomi Jagoda breaks down where the 2020 Democrats stand on taxes.
- President Trump on Monday accused former President Obama of “trying to take credit” for the strong economy after Obama commemorated the anniversary of the 2009 stimulus bill.
- Budget watchers are growing increasingly frustrated about the politicization of tackling cost-saving measures in entitlement programs, particularly Medicare.
ODDS AND ENDS
- Apple will miss its revenue projections for the second quarter of the fiscal year, blaming the coronavirus outbreak for the lower-than-expected profits.
- Democratic donor George Soros said Tuesday that Facebook CEO Mark Zuckerberg and chief operating officer Sheryl Sandberg should be removed from control of the social media company.
- Roughly two in three Americans use internet payment applications, according to a poll conducted by Financial Innovation Now, an alliance of major technology companies.