Tax bill passes the House, now faces hurdles in the Senate

The Buzz on the Hill

Tax bill passes the House, now faces hurdles in the Senate
After over a week of back and forth, Speaker Mike Johnson finally brought the Tax Act to a vote on the House floor under suspension of the rules on January 31. Despite needing a 2/3 vote to pass, the legislation received overwhelming bipartisan support, with 357 voting in favor and only 70 against. The bill, which expands the Child Tax Credit (CTC) and provides R&D tax breaks for companies, now moves to the Senate where some Republicans are already casting doubt. Sen. Mike Crapo raised concerns about expanding the CTC, and Sen. Chuck Grassley worried that passing the bill would give Pres. Joe Biden a win in an election year. The White House has already indicated they would support the legislation should it pass the Senate, but it may be at least two weeks until Majority Leader Chuck Schumer calls for a vote.

Border security legislation to be released, but it may be too late
After months of negotiations and several weeks of rumors around the release of the border security package, Majority Leader Schumer confirmed the text of the bill would be released by Sunday, with a vote taking place next week. The long-awaited bipartisan legislation, negotiated by Sens. Chris Murphy, James Lankford, and Kyrsten Sinema, would increase border security measures with supplemental aid tied to Ukraine, Israel, and Taiwan. Whatever the final bill looks like, it may all be for naught, as Speaker Johnson has already said the bill is “dead on arrival” should it reach the House. It is unclear what the ultimate fate of the legislation will be, but some lawmakers have broached the idea of passing standalone legislation for Ukraine, Israel, and Taiwan should the package fall apart. 

House Homeland Security Committee approves rare Articles of Impeachment
On Wednesday, the House Homeland Security Committee approved two articles of Impeachment against Department of Homeland Security Secretary Alejandro Mayorkas, which marked the first time in 150 years that the House impeached a Cabinet Secretary. The impeachment is a GOP effort to hold Mayorkas accountable for his handling of the border crisis, which they are claiming falls under the category of “high crimes and misdemeanors.” A vote on the articles is expected in the House next week, but even if they vote to impeach, it will fail in the Senate, where the Democrats hold the majority. Mayorkas called the proceedings “baseless.”

This Week’s Takeaways

  • On Wednesday, the Senate Judiciary Committee held a tense hearing on child sexual exploitation on Social Media. CEOs from TikTok, X, and Meta were grilled for over four hours on the lack of protections for children on these apps. The most viral moment of the hearing occurred when Meta CEO Mark Zuckerberg stood and apologized to the victims in the crowd. The hearing was indicative of the growing calls for regulation around social media to protect young people, which will remain a pressing issue throughout the year. 

  • Concerns over the Chinese Communist Party (CCP) have reached a fever pitch in Washington. This week, the House Select Committee on the CCP held a hearing on the CCP’s threat to national security, with former Secretary of State Mike Pompeo and Former Secretary of Defense Leon Panetta serving as witnesses. The House Financial Services Committee also held a hearing focused on strengthening sanctions against the CCP.

  • On a related note, reports surfaced this week that Chinese leader Xi Jinping assured President Biden that China would not interfere in the 2024 election. Xi made this promise when he met with Biden in November, which was reconfirmed by the Chinese foreign minister this week.  

Outstanding Achievements

This week, GrayRobinson held a couple of fantastic events with U.S. Representatives. On Monday, GrayRobinson and the Retail Industry Leaders Association hosted a meet and greet for the newest House Democrat Rep. Gabe Amo (D-RI) – the first Biden alum elected to office. On Wednesday, GrayRobinson welcomed Rep. Jimmy Gomez (D-CA) for a Happy Hour Event and celebrated his impending return to the Ways and Means Committee next week. Rep. Bill Pascrell (D-NJ) made a special guest appearance. 

Preparing for the Week Ahead

Tuesday, February 6

  • House Financial Services Committee Hearing titled The Annual Report of the Financial Stability Oversight Council with Janet Yellen.

  • House Transportation & Infrastructure Committee Hearing on The State of American Aviation and the Federal Aviation Administration.

Thursday, February 8

  • Senate Banking Committee Hearing titled The Financial Stability Oversight Council Annual Report to Congress with Janet L. Yellen.

  • Senate Finance Committee Hearing on Artificial Intelligence and Health Care: Promise and Pitfalls.

Other items of interest:

  • The Senate Commerce, Science and Transportation Committee is expected to hold a markup hearing on the FAA reauthorization bill.

  • The Senate is expected to vote on the bipartisan border security legislation next Wednesday according to Majority Leader Schumer.

  • The House is likely to vote on the articles of impeachment against Sec. Mayorkas at some point next week.

The Ellis Insight

PRESIDENT

Robert F. Kennedy, Jr.: Presidential candidate Robert F. Kennedy, Jr. (I) and Libertarian Party leaders confirm they are discussing the possibility of the former becoming the party’s presidential nominee. Though they are likely a long way from coming to an agreement, mostly because some of Kennedy’s major issue positions such as climate change and gun control do not align with the party leadership, the move makes practical sense for both entities.

First, being the Libertarian Party nominee would give Kennedy ballot access in all 50 states, something that is difficult for any Independent to obtain. The Libertarian Party was the only non-Democratic or Republican entity to achieve universal ballot status in 2020 (Libertarian nominee Jo Jorgensen appeared on the Libertarian line in 48 states and the District of Columbia; in Alabama and Tennessee, she appeared as an Independent), and they again would with Kennedy as their nominee.
 
Additionally, featuring Mr. Kennedy as their candidate, it is highly likely that the Libertarian Party would attract its highest historical number of votes. This is important for the organization’s future because many states base future party status upon performance in the national election.

Minnesota: A new Survey USA poll for KTSP-TV in Minneapolis (1/24-29; 1,594 MN likely voters) finds a surprisingly tight presidential race with President Biden leading Donald Trump only 42-39%.

South Carolina: A new Monmouth University poll for the Washington Post (1/26-30; 815 SC registered voters; live interview & online) sees Donald Trump posting a major 58-32% lead over former Governor Nikki Haley in her home state of South Carolina leading to the February 24 Republican primary election.
 
Mr. Trump holds an advantage among both men and women in the statewide voter sample, and within all age groups. He trails Ms. Haley only among college educated voters, but by only two points, and certain non-evangelical voter groups. Additionally, 90% of the respondents saying they would vote for Trump in the primary election would do so in the general election even if he is convicted of some of the many legal charges he faces.

Morning Consult/Bloomberg & Quinnipiac Polls: It’s a common saying in the National Football League that “on any given Sunday any team can beat another.” A similar phrase appears applicable in political polling, as well. On almost any given day, we can find polls that disagree over outcome even though conducted during the same time period. The new Morning Consult/ Bloomberg News and Quinnipiac University surveys are good examples.

The day began with Morning Consult/Bloomberg releasing their new regional survey series (1/16-22; 4,596 registered voters in Arizona, Georgia, Michigan, Nevada, North Carolina, Pennsylvania, and Wisconsin; online; part of regular tracking) that finds former President Donald Trump leading in all of the key swing states with margins between three (Arizona, Pennsylvania) to ten percentage points (North Carolina). Michigan and Wisconsin each posted five point Trump margins, while Georgia and Nevada were closer to the North Carolina number at +8.
 
Turning to their national track, MC/Bloomberg posted Mr. Trump to a two point advantage over President Biden in the head-to-head ballot test.

Yet, the Quinnipiac University release, regarding a poll in the field within a similar same time frame as MC/Bloomberg though earlier in January (1/4-8; 1,680 US registered voters; live interview), posts President Biden to his biggest national popular vote lead of any recent poll, 50-44%. When the Independent and minor party candidates are added, such as Robert F. Kennedy, Jr., the Biden edge shrinks to just two percentage points, which is consistent with other pollsters.

SENATE

California: As the March 5 Super Tuesday vote approaches, polling in the California Senate jungle primary consistently shows Rep. Adam Schiff (D-Burbank) nailing down first place, but second is undecided.
 
The latest released survey, from the University of Southern California for the Center for Urban Politics and Policy at California State University at Long Beach (1/21-29; 1,416 CA likely jungle primary voters) sees Rep. Schiff holding a 25-15-15-7% lead over Republican baseball great Steve Garvey (R) and US Rep. Katie Porter (D-Irvine). Congresswoman Barbara Lee (D-Oakland) trailed the other major candidates in fourth position.

Under the California system, all primary contenders compete on the same ballot with the top two, regardless of percentage attained and party affiliation, advancing to the general election.

Maryland: A new internal Hickman Analytics poll for the David Trone for Senate campaign (1/18-24; 1,500 MD likely Democratic primary voters; live interview) sees Mr. Trone, the 6th District Congressman, leading Prince Georges County Executive Angela Alsobrooks by a 45-34% margin in the open Democratic US Senate primary. The poll contained an oversample of African Americans and females to emphasize the groups with which Rep. Trone is weakest.

Though the early numbers look good for the Congressman, it must be understood that his campaign has spent well over $15 million to date, and $7 million alone just since November according to the Inside Elections publication. Mr. Trone has been advertising since May.

The Alsobrooks campaign has yet to run an ad. Since it is clear that she cannot match the Congressman in an ad war with him self-financing the race from his huge personal wealth, the Alsobrooks strategists are waiting until late in the contest to unleash their own ad buys. She will be competitive as we get closer to the May 14th primary, so despite Trone’s polling and resource lead, this primary battle is far from over.

HOUSE

CA-20: The California Secretary of State has attested that nine candidates have qualified for the March 19th special election to replace resigned former Speaker Kevin McCarthy (R-Bakersfield). Controversy, however, still surrounds the favorite to win the electoral contest, Assemblyman Vince Fong (R-Bakersfield).
 
Since Mr. Fong had already filed for re-election before Rep. McCarthy resigned from the Congress, the Secretary of State ruled that he could not enter the congressional race because such action would violate a California election law that prohibits individuals from simultaneously running for multiple offices. Mr. Fong sued over the administrative ruling and won in Superior Court. Therefore, he has been slated as a congressional candidate while not being removed from the state Assembly ballot.
 
The state is appealing the court ruling so even if Mr. Fong wins the special election as expected, he could be hampered by a future court decision.

Also qualifying are Tulare County Sheriff Mike Bourdeaux (R), and seven other Republicans, Democrats, and No Party Preference candidates. If no one receives majority support on March 19th, the top two finishers, regardless of party affiliation will advance to a special general election on May 21st. The regular election cycle primary is scheduled for March 5th, featuring most of these candidates. The special winner will serve the balance of Rep. McCarthy’s term. 
 
MD-2: Maryland US Rep. Charles A. “Dutch” Ruppersberger (D-Cockeysville) announced during the week that he will not seek a 12th term in the House, thus completing what will be 30 consecutive years in elective office counting his time in Congress and as Baltimore County Executive. He leaves a northern Maryland congressional district that could be on the cusp of competitiveness, but Baltimore County Executive Johnny Olszewski (D) appears primed as Rep. Ruppersberger’s heir apparent.
 
The 2nd District covers the area just north of Baltimore city and extends all the way to the Pennsylvania border. It includes about 2/3 of Baltimore County, 90% of Carroll County, and about 30,000 residents in Baltimore City. The FiveThirtyEight data organization rates the seat as D+11. Dave’s Redistricting App calculates a 52.5D – 41.4R partisan lean, and the Daily Kos Elections site ranks MD-2 as the Democrats’ 62nd most vulnerable seat.

NY-3: The Daily Kos Elections and AdImpact organizations charted the spending in the special congressional election to replace expelled Rep. George Santos (R-Long Island) as we approach the February 13th election day. According to their data, the overall Democratic operation is outspending the encompassing Republican effort by a large amount, $9.6 million to $5.7 million. The two candidates are former US Rep. Tom Suozzi for the Democrats, and Nassau County Legislator Mazi Melesa Pilip for the GOP.

The Congressional Leadership Fund, however, is coming in late to help even the score.  They have reserved $2.6 million in television and digital ads to bring the final days spending into parity. In terms of spending booked for the final two weeks, the Democratic advantage narrows to $2.8 to $2.44 million.
 
NJ-7: Democrats want to make a strong run against freshman New Jersey US Rep. Tom Kean, Jr. (R-Westfield), but one of their candidates decided to end his congressional bid. Summit Township Councilman Greg Vartan announced that he will suspend his campaign leaving former State Department official Jason Blazakis and ex-Working Families Party state director Sue Altman as the two competing Democrats.
 
Former Congressman Tom Malinowski (D), the man Rep. Kean unseated in 2022, recently announced he would not enter the Senate race. Speculation has surrounded him about seeking a congressional rematch, but there is no tangible evidence that the former Representative is planning to make a 2024 comeback.

NY-26: New York US Rep. Brian Higgins (D-Buffalo), who announced back in November that he would resign the House seat he has held for almost 20 years to take a position in the non-profit sector back in Buffalo, issued a statement saying that he is leaving Congress on February 2. Once the seat is officially vacant, Gov. Kathy Hochul (D) will have ten days to call the special election for a period no less than 70 and no greater than 80 days from the scheduling announcement.
 
The local Democratic county chairmen have already chosen state Senator Tim Kennedy (D-Buffalo) as the party’s special election nominee. Republicans are not likely to be competitive in the Buffalo anchored district which carries a partisan rating of D+18 according to the FiveThirtyEight data organization. At this point, the local Republican county chairs have not announced a special election nominee. 
 
SC-1: Earlier in the week, South Carolina US Rep. Nancy Mace’s (R-Charleston) former chief of staff, Dan Hanlon, filed a congressional campaign committee to challenge her in this year’s Republican primary. Late this week, a former Nikki Haley gubernatorial cabinet official, Catherine Templeton, announced that she, too, will oppose the Congresswoman.
 
Ms. Templeton, the former director of the South Carolina Department of Health and Environmental Control ran for Governor in 2018, but finished third in the Republican primary, losing to Gov. Henry McMaster. As Lt. Governor in 2017, Mr. McMaster ascended to the Governorship when Ms. Haley was appointed UN Ambassador.

With the US Supreme Court still deciding whether the lawsuit challenging the 1st District as a racial gerrymander is valid, there is still a possibility that this seat could be redrawn before the candidates appear on the ballot. The South Carolina primary is June 11, with a runoff scheduled for June 25 if no candidate receives majority support. Unless the district is ordered changed, the eventual Republican nominee becomes a prohibitive favorite in the general election.

GOVERNOR

North Dakota: At-Large US Rep. Kelly Armstrong (R-Bismarck) continues to solidify himself as the heir apparent to retiring Gov. Doug Burgum (R). Former state Senator Tom Campbell (R), an announced gubernatorial candidate, has already pulled out of the race.  Instead, he will run for Rep. Armstrong’s open US House seat. It already appears that Mr. Armstrong is becoming a consensus gubernatorial candidate, and the real race will be the Republican primary to succeed him in the US House.

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“Close the Shadow Banking Loophole Act” Directly Targets Industrial Loan Companies (ILCs)