The Full Belmonte, 6/1/2023
House Speaker Kevin McCarthy walks to the House chamber on Wednesday.
Debt ceiling
“The House of Representatives passed a bill Wednesday to suspend the nation's debt limit through January 1, 2025. This comes as lawmakers race the clock to avert a first-ever default ahead of June 5 — the date the Treasury Department has said it will no longer be able to pay all of the nation's obligations in full and on time. House Speaker Kevin McCarthy took a victory lap immediately after the House passed the debt limit deal with a big bipartisan showing. The legislation will now need to be passed by the Senate before it can be sent to President Joe Biden to be signed into law. But in the Senate, any one lawmaker can delay a swift vote and it is not yet clear when a final vote will take place.” [CNN]
Donald Trump recorded while talking about classified document on Iran, report says
“Federal officials have an audio recording of former President Donald Trump discussing he had a classified Pentagon document about a possible attack on Iran, CNN reported, citing multiple unidentified sources. The report comes as the former president’s attorneys are seeking a meeting with Attorney General Merrick Garland about the Justice Department investigation of classified documents found at Trump's Mar-a-Lago home and private club. The probe concerns whether the former president mishandled classified documents and whether he obstructed justice by defying a subpoena to return documents he took from the White House. Trump has denied wrongdoing in the investigation.” Read more at USA Today
Presidential race
“Former Vice President Mike Pence will launch his 2024 presidential campaign on June 7 with an announcement video and a speech in Iowa, two sources familiar with the plans tell CNN. Pence's presidential bid will pit him against his former boss and running mate, former President Donald Trump, who's seeking a second term and is for now the early frontrunner. It will be an uphill climb for Pence, who has been polling in single digits, while Trump and Florida Gov. Ron DeSantis, who jumped into the race last week, continue to lead the field. Separately, former New Jersey Gov. Chris Christie plans to announce his candidacy in the 2024 race on Tuesday, according to sources familiar with the matter. Christie, who also ran in 2016 and has been outspoken against Trump, will make the announcement at a town hall at Saint Anselm College.” [CNN]
Ukraine
“The war in Ukraine has taken a new turn this week amid increased shelling and drone strikes inside Russia's border, including Moscow. Ukraine has denied any involvement in drone attacks on the Russian capital, even as one top official made it clear that Russia was getting a taste of its own medicine after months of bombarding Ukrainian cities. ‘Of course, we enjoy watching and predicting an increase in attacks,’ said Ukrainian presidential adviser Mykhailo Podolyak. ‘But of course, we have nothing to do directly with it.’ The US National Security Council's John Kirby told CNN on Wednesday that the US is uncertain about who coordinated the recent drone incursions, adding that the Biden administration has ‘been clear, privately and publicly, with the Ukrainians that we don't support attacks on Russian soil.’” [CNN]
UFOs
“An independent team assembled by NASA will publish its first report on unidentified anomalous phenomena, also known as unidentified flying objects, or UFOs, by the end of July. Unidentified anomalous phenomena, or UAP, ‘are events in the sky that cannot be identified as aircraft or known natural phenomena from a scientific perspective,’ according to NASA. ‘The report will inform NASA on what possible data could be collected in the future to shed light on the nature and origin of UAP’ and ‘assess whether those phenomena pose any risks to safety,’ according to the agency. There have been several studies of UAPs carried out by various arms of the US government, including a Pentagon report that was declassified in June 2021, though none have given the public a clear answer about what the UAPs could be.” [CNN]
Earth is ‘really quite sick now’ and in danger zone in nearly all ecological ways, study says
By SETH BORENSTEIN
FILE - A swan stands between dumped plastic bottles and waste at the Danube river in Belgrade, Serbia, on April 18, 2022. A new study says Earth has pushed past seven out of eight scientifically established safety limits and into ‘the danger zone,’ not just for an overheating planet that’s losing its natural areas, but for well-being of people living on it. The study, published Wednesday, May 31, 2023, for the first time it includes measures of ‘justice,’ which is mostly about preventing harm for groups of people. (AP Photo/Darko Vojinovic)
“Earth has pushed past seven out of eight scientifically established safety limits and into ‘the danger zone,’ not just for an overheating planet that’s losing its natural areas, but for the well-being of people living on it, according to a new study.
The study looks not just at guardrails for the planetary ecosystem but for the first time it includes measures of ‘justice,’ which is mostly about preventing harm for countries, ethnicities and genders.
The study by the international scientist group Earth Commission published in Wednesday’s journal Nature looks at climate, air pollution, phosphorus and nitrogen contamination of water from fertilizer overuse, groundwater supplies, fresh surface water, the unbuilt natural environment and the overall natural and human-built environment. Only air pollution wasn’t quite at the danger point globally.
Air pollution is dangerous at local and regional levels, while climate was beyond the harmful levels for humans in groups but not quite past the safety guideline for the planet as a system, the study from the Swedish group said….” Read more at AP News
Safety agency plans to require automatic emergency braking in new cars
“The National Highway Traffic Safety Administration said it plans to require that all new passenger cars and light trucks include potentially life-saving automatic emergency braking and meet stricter safety standards within three years.
The proposal represents the NHTSA’s latest move toward regulating electronic systems that take on certain tasks that drivers themselves have normally done. The agency said it projects that the proposed rule, if finalized, would save at least 360 lives a year and reduce injuries by at least 24,000 a year.
The agency says 90 percent of new passenger vehicles already include the braking technology. But it says NHTSA wants to make the braking systems more effective at higher speeds and better at avoiding pedestrians.
The regulation proposed by NHTSA will require, for example, that the systems allow vehicles to fully avoid other vehicles at up to 50 miles per hour if a driver should fail to react. If a driver brakes some but not enough to stop a collision, the system would have to avoid hitting another vehicle at up to 62 mph.” [NBC News]
Wall Street wants Dimon for prez
Photo Illustration: Natalie Peeples/Axios. Photo: Cyril Marcilhacy/Bloomberg via Getty Images
“JPMorgan Chase CEO Jamie Dimon hinted at a potential presidential run today, telling Bloomberg TV in Shanghai, China:
‘I love my country, and maybe one day I’ll serve my country in one capacity or another.’
Dimon had pretty much ruled out running and said he believes he makes a positive difference in his current job.
Why it matters: The persistent energy and chatter around Dimon as a potential candidate reflects the business establishment's dismay with the current options, Axios' Alex Thompson writes.
The big picture: Wall Street is dreading a rematch between Donald Trump and Joe Biden, and Dimon ‘recently got an earful from a fellow billionaire’ who wishes he'd run, The Wall Street Journal reports(subscription).
A former Obama Treasury official told Axios: ‘If you liked dreaming of Mike Bloomberg in the White House, you are going to love these Jamie Dimon comments. Many on Wall Street don’t believe that the Biden White House has been very easy to navigate.’
Bill Ackman, the billionaire investor, tweeted today that Dimon ‘is the kind of person our country deserves as our next leader.’
‘Politically he is a centrist. He is pro-business and pro-free enterprise, but also supportive of well-designed social programs.’” [Axios]
Axios interview: Tim Scott on being single
Axios' Sophia Cai interviews Sen. Tim Scott in Washington today. Photo: Eric Lee/Axios
“If elected, Sen. Tim Scott (R-S.C.) would be America's first unmarried president since Grover Cleveland married in office in 1886 — 137 years ago.
Asked about that today at an Axios News Shapers event — Scott's first onstage conversation since announcing his run last week — he told Sophia Cai:
‘To suggest that somehow being married or not married is going to be the determining factor whether or not you're a good president or not — it sounds like we're living in 1963 and not 2023.’
Scott mentioned that he has a girlfriend, but said, ‘I will not start a new family until I can support my mother in a position that I wanted to.’
Scott, 57, the only Black Republican in the Senate, spoke about his experience when he approached Republicans to run for county council in South Carolina.
‘They said, 'You know you Black, right?' ... I have seen a mirror.’
‘Yeah, you can run, but there's never been a Black person ... run as a Republican and been successful for anything countywide.' ... I, fortunately, won that race.’
‘There is this evolution of the Southern heart that happened along the way, where people actually judge you not on the color of your skin, but on the content of your character,’ Scott added.
‘That was a dream [60] years ago. It's become more and more of a reality.’” [Axios]
June 1, 2023
Good morning. We’re covering the House passing the debt limit bill, a tape of Donald Trump and how to spend 36 hours in Los Angeles.
Speaker Kevin McCarthy and President Biden.Doug Mills/The New York Times
Policy over principle
“With the House passing a debt ceiling bill last night and the Senate likely to follow, I want to use today’s newsletter to assess President Biden’s handling of the issue.
Here’s my simple summary: Biden both won and lost. On policy grounds, he negotiated a good deal for Democratic Party priorities — but at the cost of abandoning what he had claimed was his principled refusal to negotiate over the debt ceiling. For Democrats to avoid a repeat of this experience, they will have to change their debt-ceiling strategy in future years.
How Biden won
Elections have consequences, as politicians like to say. Last year’s midterm elections left the country with divided government in which Democrats control the White House and Senate while Republicans control the House.
Even if the country had no debt ceiling, the two parties would have had to negotiate a budget this year. And the bill that the House passed yesterday — based on a compromise negotiated by Biden and Kevin McCarthy, the Republican speaker of the House — looks a lot like what a budget deal probably would have.
It is a short-term bill that lacks any attempt to solve the country’s long-term fiscal challenges through tax increases or changes to Medicare and Social Security. It also lacks major cuts to other domestic spending, instead reducing its growth by a few percentage points over the next two years.
Republicans were able to use their control of the House to insist on several policy changes, including lower nonmilitary spending; work requirements in anti-poverty programs; less funding for the enforcement of tax laws; and approval of an Appalachian gas pipeline. Democrats protected their biggest policy goals, including recent legislation on clean energy, health care and infrastructure. Biden may also be able to minimize the impact the bill’s spending cuts (like those related to tax enforcement) by later moving money from one program to another.
The fate of Biden’s climate policies seems especially important. The House bill not only protects all the clean energy subsidies passed last year, but also includes a bipartisan priority known as permitting reform that has the potential to remove some of the bureaucratic obstacles to major clean-energy projects.
I know some climate advocates are nonetheless angry because of the Appalachian pipeline, but I think they’re missing the big picture. Presidents do not have magical powers, and Biden has demonstrated that climate change is a top priority for him. ‘This is the thing the Climate Left keeps not acknowledging,’ Matthew Yglesias wrote in his Substack newsletter this week.
Given the radicalism of today’s Republican Party and its tolerance for political chaos, there was a real risk that these debt ceiling talks would cause an economic crisis. Instead, they led to a classic political deal that left untouched the major accomplishes of Biden’s first term. It is a reminder that he is the most successful bipartisan negotiator to occupy the White House in decades.
How Biden lost
Almost no other country in the world has a debt ceiling. Legislators elsewhere see it as redundant. Politicians can argue about taxes and spending when writing budgets, but once they pass those budgets they don’t debate whether to pay their country’s bills.
If you think of it in terms of a family budget, you can see why the rest of the world scoffs at the idea. A family should have a serious discussion over whether it can afford a new car or house. But once it has bought the car or house, there isn’t much point in arguing over whether to pay the bill. Reneging on it will only worsen the family’s finances.
This background helps explain why Biden and his aides insisted — publicly and privately — that they would not negotiate over increasing the debt ceiling. Doing so, they explained, would encourage future ransom demands when the country again approached its debt limit. Congress should pass a straightforward increase to the limit, White House officials said, and Biden would then be happy to negotiate over the federal budget.
Instead, they abandoned this position and started negotiating with Republicans over the debt ceiling.
To be fair, Biden may not have had a choice. Had he refused to negotiate, a financial crisis could have ensued, and Biden might have taken the blame. But his surrender shows that Democrats (and the country) would benefit from a longer-term solution to the debt ceiling. As long as it exists, it will create economic uncertainty and give Republicans an extra opportunity to cut spending.
There is a straightforward solution, too. At any point, Congress could repeal the debt ceiling or raise it so high that it would be irrelevant for decades.
Some Democrats, including both progressives like Senator Elizabeth Warren and moderates like Senator Michael Bennet, favor this approach and pushed for it when their party controlled Congress early in Biden’s presidency. But other moderates, led by Senator Joe Manchin, blocked it, apparently out of a desire to show concern about the deficit. (Again, the debt ceiling isn’t actually fostering long-term deficit solutions, as Ezra Klein explains.)
Another scenario for solving the debt ceiling problem could come during a Republican presidency. When Donald Trump was in office, congressional Democrats raised the ceiling and asked for almost nothing in return. Imagine if they had said they would not act unless he agreed to raise it by so much that the issue would be irrelevant for many years.
Until the debt ceiling goes away, unnecessary economic turmoil will be a recurring feature of American politics. The next standoff is likely to occur in 2025.
For more
A bipartisan coalition powered by Democrats ensured the bill passed, angering far-right representatives who saw the vote count as a win for Democrats.
Representatives Jim Jordan and Marjorie Taylor Greene helped curb far-right dissent, Politico reports.
Speaker Kevin McCarthy defied expectations in passing the bill.
While the bill cuts federal spending, agreements made to get a deal will eat away at the total savings.” [New York Times]
“The BRICS group of emerging nations is accelerating its drive to become a serious economic and political force.
It’s been a long time coming.
Dreamed up in 2001 as an acronym identifying the rapid growth of Brazil, Russia, India and China, it became a formal entity in 2009, with South Africa joining the following year. But it’s consistently failed to punch its weight.
Now, with Beijing locked in global rivalry with Washington and Moscow subject to international sanctions over its war on Ukraine, the group is weighing efforts to counter the dominance of the US and the European Union.
BRICS nations have already agreed to pool $100 billion of foreign currency, funds they can tap during emergencies, and founded their own bank that’s approved more than $30 billion of loans for water, transportation and other infrastructure projects since 2015.
When the bloc’s foreign ministers meet in Cape Town today, expansion of its membership and moves to establish a shared currency will be on the agenda. A summit of heads of state will be held in Johannesburg in late August.
Existing BRICS members represent more than 42% of the world’s population and account for 23% of global gross domestic product. Some 19 other countries have expressed interest in joining, with Saudi Arabia among those that have formally applied, bolstering the BRICS’ claim to a bigger seat at the global table.
But the plan carries risks.
It threatens to raise hackles in the US and among its allies, which are trying to build a united front against Moscow and hone a collective stance on Beijing.
The very makeup of the group presents another problem. Its current members already straddle a mix of governing systems and ideologies with widely divergent views.
The line of countries seeking to be part of BRICS tells its own story of a fracturing world. Yet any enlargement could complicate the bloc’s ambitions to be a cohesive actor on the global stage.”—Michael Cohen and S’thembile Cele [Bloomberg]
Chinese President Xi Jinping and Indian Prime Minister Narendra Modi during the BRICS Summit in Xiamen, China, in 2017. Photographer: Kenzaburo Fukuhara/AFP/Getty Images
“Russia’s invasion of Ukraine has jolted the North Atlantic Treaty Organization awake, French President Emmanuel Macron said, almost four years after he branded the military alliance brain dead. In an about-face, Macron said he wanted EU member states to discuss deeper cooperation to acquire independent strike capabilities and guarantee their own security.
Sweden is hoping legislation that comes into force today punishing participation in any terrorist group will provide the necessary impetus for Turkey to approve its accession into NATO.” [Bloomberg]
A lopsided trade relationship with India is forcing Russia to accumulate up to $1 billion each month in rupee assets that remain stranded outside the country, swelling a $147 billion stockpile of capital it’s amassed abroad since the invasion of Ukraine. While Russia has emerged as a top supplier of oil to India over the past year, settling a greater share of trade in national currencies, imports from India are stagnating.
“Ukrainian President Volodymyr Zelenskiy made an unannounced appearance today at a European summit in neighboring Moldova, on the same day that Russia rained more missiles down on Kyiv. At least three people were killed, including two children, and 14 injured in the strikes, Kyiv Mayor Vitali Klitschko said. It’s the 19th Russian missile attack on the capital in the past month.” [Bloomberg]
Facing a sluggish post-pandemic recovery and outside investors wary of falling foul of US tensions, China is rolling out the red carpet for global business leaders. JPMorgan’s Jamie Dimon and Tesla’s Elon Musk are among those who met separately with senior Communist party officials this week, while Nvidia’s Jensen Huang is also expected in China, as Beijing seeks to allay fears the world’s No. 2 economy is becoming hostile to foreign capital.
Musk, a prolific presence on Twitter and owner of the social media platform, didn’t send any tweets while he was in China for his first visit since the pandemic.
The US and the EU are struggling to agree on specific ways to slow China’s technological rise and limit what they regard as its coercive trade practices.” [Bloomberg]
“Brazil’s lower house of congress approved a provisional measure establishing the structure of President Luiz Inacio Lula da Silva’s cabinet, a relief for the leftist leader whose government was nearly thrown into chaos. Lula called emergency meetings with political allies and lower house Speaker Arthur Lira to secure its passage yesterday. The measure still needs to go to the Senate for a vote before it expires today.” [Bloomberg]
“China and Singapore agreed to work toward establishing a secure defense telephone link for high-level communications as they seek to bolster ties amid rising regional tensions.
Poland’s president rejected criticism from the US and the EU over a law that would potentially put the country’s opposition leader under investigation ahead of elections.
EU members are considering requiring that at least half of the critical raw materials the bloc needs are processed domestically in an effort to better prepare for the clean-energy transition.
US and Taiwanese security officials discussed how companies from the self-governing island could adopt key US defense supply chain standards at a rare meeting on American soil in April, a senior government official in Taipei said.
OPEC hasn’t invited reporters from three major news organizations — Bloomberg News, Reuters and the Wall Street Journal — to cover the group’s meetings this weekend in Vienna.” [Bloomberg]
“Soon after the Taliban retook Afghanistan in 2021, the then head of Pakistan’s spy agency arrived at one of Kabul’s plushest hotels, smiling, sipping tea and appearing at ease with the militants’ return to power after clandestinely supporting their fight against US-led forces. Now, as Eltaf Najafizada and Ismail Dilawar report, relations between the Taliban and Pakistan have soured, terrorist attacks by Tehreek-e-Taliban Pakistan have jumped and some Taliban leaders are even seeking to establish ties with Pakistan’s archrival, India.” [Bloomberg]
Damage after Taliban forces fired mortars at Pakistan’s border town of Chaman in December 2022. Photographer: Abdul Basit/AFP/Getty Images
CEOs got smaller raises. It would still take a typical worker two lifetimes to make their annual pay
By ALEXANDRA OLSON
(AP Illustration/Peter Hamlin)
“After ballooning for years, CEO pay growth is finally slowing.
The typical compensation package for chief executives who run S&P 500 companies rose just 0.9% last year, to a median of $14.8 million, according to data analyzed for The Associated Press by Equilar. That means half the CEOs in the survey made more and half made less. It was the smallest increase since 2015.
Still, that’s unlikely to quell mounting criticism that CEO pay has become excessively high and the imbalance between company bosses and rank-and-file workers too wide. Discontent over that gap has helped fuel labor unrest, and even some institutional investors have pushed back against a few of the most eye-popping packages.
The smaller increase came after CEO pay soared 17% in 2021, when boards rewarded top executives handsomely for steering their companies through the pandemic-induced recession.
Many of the compensation packages were approved early in 2022 but even a small raise might seem lavish in retrospect against the backdrop of a year in which stock markets tanked to their worst performance since 2008, inflation erased wage gains, fears of a recession grew, and tech giants began laying off workers….” Read more at AP News
Amazon
“Amazon on Wednesday agreed to pay more than $30 million to settle privacy complaints over its Alexa voice assistant and Ring doorbell cameras. The settlements with the Federal Trade Commission highlight claims that the company retained Ring videos and Alexa voice recordings — including that of children — for years. The FTC also alleges Amazon held on to voice recordings and geolocation in some cases without users' consent and despite requests by consumers for the data to be deleted. The company in a statement disagreed with the claims and denied violating the law. However, as part of the agreement, Amazon said it will send consumers notices about the FTC settlement as well as implement a more robust privacy program.” [CNN]
Danny Masterson found guilty of 2 counts of rape in retrial, faces up to 30 years in prison
Staff and wire report
“A jury found Danny Masterson guilty of two counts of rape Wednesday at his Los Angeles retrial. The "That '70s Show" actor faces up to 30 years in prison.
The jury of seven women and five men reached the verdict after deliberating for seven days spread over two weeks. They could not reach a verdict on the third count, that alleged Masterson raped a longtime girlfriend. They had voted 8-4 in favor of conviction.
Masterson was led from the courtroom in handcuffs. His wife, actor and model Bijou Phillips, wept as he was led away. Other family and friends sat stone-faced.
Masteron, 47, was charged in 2020 with raping three women at his Los Angeles home between 2001 and 2003. His first trial for the case ended in a mistrial last November, with jurors deadlocked on all three counts.
In January, a request to throw out the case was denied and a retrial was confirmed. The retrial lasted about three weeks. Masterson’s defense attorneys declined to call any witnesses…..” Read more at USA Today
How to get away with fueling an opioid epidemic
Michael Nigro/Pacific Press/LightRocket via Getty Images
“A federal appeals court ruled that the Sacklers, the wealthy family behind Purdue Pharma, can be protected from future lawsuits as part of a deal to settle thousands of opioid crisis claims.” [Vox] [Associated Press / Geoff Mulvihill]
“The Sackler family will pay states $5-6 billion to states including at least $750 million that will go to individual victims and their families.” [Vox] [NPR / Brian Mann]
“The family will give up control of bankrupt Purdue, and the company will be restructured to develop drugs for treating and preventing addiction.” [Vox] [New York Times / Jan Hoffman]
“Purdue has pleaded guilty to charges that its OxyContin advertisements helped jumpstart a US opioid crisis that caused more than 500,000 deaths in the US over two decades. However, the Sacklers have admitted no wrongdoing.” [Vox] [Reuters / Dietrich Knauth]
“In recent years, drug manufacturers, distributors, and pharmacies have agreed to pay more than $50 billion to settle lawsuits for their role in the national opioid crisis.” [Vox] [Guardian]
NBA Finals begin with Nuggets heavily favored
“Jimmy Butler and the eighth-seeded Miami Heat will face Nikola Jokic and the top-seeded Denver Nuggets in the 2023 NBA Finals. One of them will become a champion for the first time, with these top players leading in a matchup that starts Thursday night in Denver, with the Nuggets heavily favored to win it all. The Nuggets are making their first Finals appearance, while the Heat will make their seventh franchise appearance and their first since the 2020 bubble season.” Read more at USA Today
Nikola Jokic and the Denver Nuggets will battle the Miami Heat in the NBA Finals.
Ron Chenoy, USA TODAY Sports
Party in the Big Easy
Revelers take to Bourbon Street during Mardi Gras this year. Photo: Jon Cherry/Getty Images
“Cities around the world are sending stern-if-subtle messages to tourists: The party is over. Or at the very least, a little mellower.
New Orleans is bucking the trend.
As reins tighten elsewhere, New Orleans officials say they’re keeping the lights on to boost tourism, Axios New Orleans co-author Chelsea Brasted writes.
You can’t stay here: In Amsterdam, the Netherlands — a city long known for its tolerance of marijuana and hallucinogenic mushrooms — a new campaign asks debauchery-seeking tourists to ‘stay away.’
Bans and curfews: Miami promoted a fitness campaign during spring break and banned takeaway alcohol after 6 p.m., Axios Miami co-author Martin Vassolo reported.
In New Orleans, there seems to be little appetite for changing the messaging as the city’s reputation grows beyond Bourbon Street, says New Orleans & Company president and CEO Walt Leger:
‘We will continue to welcome everyone with open arms.’” [Axios]
“Lives Lived: Brian Shul was an Air Force major who flew the world’s fastest plane. He died at 75.” [New York Times]