May 3, 2024

Thought of the Week:

As part of my volunteer work, I recently attended a golf event to benefit a charity organization for American servicemen and women. The charity pairs wounded American veterans with country music singer/songwriters, and the two work together to write and record a song about the veteran’s personal experience with war. Among the well-known artists who have participated include Jelly Roll, Kayne Brown, Vince Gill, Hardy, and Brantley Gilbert among others. Not only is the writing process cathartic, but also potentially lucrative in that the veteran receives a writing credit for the song. At tournament check-in, one of the fundraising gimmicks for the charity is the sale of mulligans. Although against the formal rules of golf, a mulligan allows a golfer to replay a shot in hopes of a better outcome than the original stroke. Mulligans have the very real potential to improve one’s score, and therefore, chance to win the event. While many legends exist and plenty of famous clubs claim ownership to the practice, the term “mulligan” is said to have its roots at Winged Foot Country Club. According to golf lore, a hotel executive named David Mulligan would often cut out of work early and race to Winged Foot from New York City. He was known to rush to the first tee without a warm-up and would often ask to hit a second shot, citing his car ride as an excuse. And with that, the term mulligan was born. After losing his reelection bid in 2020, if former president Trump were to win this year’s election, he would be given a political mulligan of sorts. And the former golfer-in-chief would be almost certain to utilize the Congressional Review Act (CRA) as a legislative mulligan to overturn recently approved federal regulations. The CRA lets simple majorities of lawmakers in both chambers vote to undo regulations, subject to presidential veto. In a practical sense, opponents taking on a current administration’s regulation would need enough votes to override a veto; however, CRA efforts are much more likely to succeed after a new administration comes in and lawmakers back reversing a predecessor’s policy. The window to act under the CRA is typically within 60 legislative days of a regulation being finalized, but varying rules related to the end of a Congress give opponents additional time to act, which adds tension to any administration in its fourth or eighth yea. This year, the CRA has certainly become a flashpoint as the Biden administration races to finalize key rules ahead of the election. Under the CRA’s “lookback period,” the window for Congress to disapprove of a rule can restart at the beginning of a new congressional session for any regulation finalized during the last 60 legislative days of the last session. Based on current House and Senate schedules, this year that day would come sometime in early August. This term’s CRA window could impact a number of key rules that are still pending before the administration—including regulations on lead pipes, methane emissions, energy tax credits, birth control coverage, asset custody rules, equity market structures, AI standards, and bank capital requirements to name a few. While use of the CRA was rare prior to 2001, when a Clinton administration rule was struck down during the George W. Bush administration, its use has grown in frequency. Former President Trump and Republicans in Congress blocked 16 rules from the Obama administration using the CRA, and President Biden and Democrats in Congress overturned three Trump administration rules in 2021.

Thought Leadership from our Consultants, Think Tanks, and Trade Associations

Eurasia Group Says a Second-Term Biden Trade Policy Would Shelter the Domestic Green Manufacturing Industry. The green energy transition and the decarbonization of trade would take on a more pronounced role in President Biden’s trade agenda during a second term; this would complement passage in Biden’s first term of a U.S. green industrial strategy as part of the Inflation Reduction Act (IRA), and it would work within the constraints of a tougher China tariff policy. The absence of USTR market access negotiations and a U.S. carbon pricing mechanism would limit trade policy tools for meeting green industrial goals, but a second Biden administration would likely emphasize financing for green manufacturing in emerging markets and more protectionist trade policies to incubate green manufacturing growth at home. American green manufacturing under Biden—particularly in the electric vehicle (EV) and solar industries—would benefit from rising emerging market environmental production standards, the incentivization of green production away from China, and tariff-led protection from finished green product imports entering the U.S. market.  

Eurasia Group Sees Protest Escalation as a Risk to Biden’s Reelection. University protests over the Israel-Hamas war have spread and intensified over the last week, facing an increasingly hostile police reaction on campuses across the country. Despite the media attention, the protests do not represent a new threat to President Biden’s reelection campaign; that Biden is relatively weaker among young voters today than in 2020 was already clear, and polling indicates that the Israel-Hamas war is a top issue only for a small, unrepresentative proportion of young voters. However, there is a clear path for campus protests to impact Biden’s chances of reelection negatively: protests could continue through the spring and summer culminating in significant disruptions at the Democratic National Convention in Chicago that would recall memories of the 1968 convention. The convention is one of the most important events on the political calendar, and a disruption in front of tens of millions of television viewers in August would be an enormous publicity problem. Democratic elected officials are reportedly concerned about this possibility, including disruptions coming from convention delegates themselves. A key signal for whether this scenario is likely will be whether protests continue their momentum through the late spring, after college semesters end, or whether they peter out amid police crackdowns. In this scenario, former president Trump could run on a law-and-order message similar to what Richard Nixon did in 1968, arguing that Biden is a “chaos candidate” who cannot keep his own side in line. If protests turn violent, this argument could sway enough moderates and independents to make a difference in November.  

“Inside Baseball”

Punchbowl News reports that after flailing for months, unable to unite on anything, House Republicans have found an issue they agree on—countering antisemitism on college campuses. With 187 days until Election Day, a bare legislative cupboard, and a presidential impeachment that’s gone nowhere, the anti-Jewish sentiment shown at universities during Gaza war protests offers Republicans a compelling plot for the remainder of the 118th Congress. “It’s morally the right thing to do—to call it out…There’s no gray area here,” Speaker Johnson (R-LA) said. But for House Democrats, the entire picture is gray—and therein lies the political upside for Republicans. Although the majority of House Democrats still back Israel, many have been critical of Israeli forces’ conduct during the conflict, which represents a serious break in the bipartisan support for Israel. What’s more, a large group of House Democrats don’t see criticism of Israel or the pro-Palestinian protests as antisemitic. In fact, younger, progressive Democrats back the protests. So, GOP response to the protests, including votes on antisemitism and high-profile hearings with university officials, is causing angst in the House Democratic Caucus. Case in point: 70 Democrats voted against a bipartisan bill to broaden the definition of antisemitism used by the Education Department; Democratic leaders hoped to keep defections near 30. Although the bill faces an uncertain future in the Senate, there was glee inside the GOP caucus by pushing what they considered good policy while putting Democrats in a bind. Going forward, Republicans will: (1) embark on a months’ long investigation into antisemitism on college campuses, bringing officials from Yale, UCLA, and Michigan to Washington; (2) the House Oversight Committee will hold a hearing on why DC Police rebuffed the George Washington University administration’s request to clean up its campus; and (3) several appropriations panels will try to strip federal funds from schools that don’t do enough to protect Jewish students.  

In Other Words

Saturday Night Live “Weekend Update” co-anchor Colin Jost roasted President Biden and former President Trump at this past weekend’s White House Correspondents Dinner.

Best jokes about Biden: 

“I have to admit it’s not easy following President Biden. I mean, it’s not always easy following what he’s saying.”

“My Weekend Update co-anchor Michael Che was going to join me here tonight, but in solidarity with President Biden, I decided to lose all my Black support.”

“The last time I was in D.C., I left my cocaine at the White House. Luckily, the president was able to put it to good use for his State of the Union.”

“The economy is sort of like you on the steps of Air Force One: It feels like it’s stumbling, but there is somehow upwards progress.”

 Best jokes about Trump: 

— “Can we just acknowledge how refreshing it is to see a president of the United States at an event that doesn’t begin with a bailiff saying ‘All rise’?”

— “Lara Trump is here tonight. She recently released a cover of ‘I Won’t Back Down.’ Upon hearing it, Tom Petty died again. I can’t believe I’m saying this to a member of the Trump family, but maybe stick to politics.”

Did You Know

President Richard Nixon is the only person to be elected twice as vice president and twice as president of the United States.

Graph of the Week

The Conference Board’s Consumer Confidence Index Deteriorated for the Third Consecutive Month in April, retreating to 97.0 (1985=100) from a downwardly revised 103.1 in March. Overall, confidence fell to its lowest level since July 2022, as consumers became less positive about the current labor market situation and more concerned about future business conditions, job availability, and income. Elevated price levels, especially for food and gas, were major concerns in April, although 12-month inflation expectations remain relatively stable. Despite three straight months of weakness, the Conference Board notes that over the longer-term consumer confidence continues to move sideways within a relatively narrow range that’s held steady for more than two years.

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