The package, which provides historic levels of funding for key policy areas, now faces an uphill battle in the Senate.
Historic Legislation Clears First Hurdle
After months of negotiation, the House on Friday approved the $2 trillion social safety net and climate spending package at the center of President Joe Biden’s domestic agenda.
The legislation, dubbed the Build Back Better Act, was passed by a vote of 220 to 213 along near party lines. Just one Democrat voted against the measure.
Republicans remained in their unified opposition to the bill, and its passage was delayed after Minority Leader Kevin McCarthy (R-Ca.) took to the floor to speak for over eight hours through the night, setting a new record for the longest continuous House speech in modern history.
The package represents a massive overhaul of American education, healthcare, climate, and tax laws that, in some instances, provides historic levels of funding for key policy areas.
Among other measures, the bill would allocate $550 billion in clean energy investments, an amount that the White House said represents the largest federal expenditures in initiatives to combat climate change.
Some of the biggest funding areas also center around education, including a provision that would provide universal free pre-kindergarten for all 3-year-olds and 4-year-olds, which the White House has described as the most significant expansion in such education programs since public schools were first created nearly half a century ago.
The universal pre-k program is part of a broader $400 billion in funding aimed at making childcare more affordable by ensuring that families earning under $300,000 annually will not have to spend more than 7% of their income on childcare for any children under six.
On top of that, the bill will implement affordable health care changes that are estimated to extend coverage to an additional 7 million Americans through expansions to Medicaid and further reductions in the costs of premiums for plans bought under the Affordable Care Act.
Most of the spending proposed in the act would be paid for by taxes on corporations and wealthy Americans. The legislation puts forward a 5% surtax on taxpayers with incomes above $10 million and an added 3% on incomes above $25 million.
For corporations, a 50% minimum tax on foreign profits would be levied, and companies that bring in more than $1 billion in profits would face a 15% minimum tax.
A Long Road Ahead
The $2 trillion price tag falls short of the initial $3.5 trillion that Biden had asked for, but even with the pared-down spending, the package still faces an uphill battle in the 50-50 split Senate.
Democratic leaders have said they intend to pass the legislation through budget reconciliation, which would allow them to approve the measure with a simple majority and thus, no Republican support.
That plan, however, would require all 50 Democrats to sign on. Joe Manchin (D-W.V.) and Kyrsten Sinema (D-Az.), however, have continually sought to negotiate down many elements of the Build Back Better proposal and so far have withheld their endorsements of the House bill.
Manchin has expressed his opposition to a provision in the bill that would give four weeks of paid family and medical leave for most American workers who are not already offered the options.
Meanwhile, Sinema has not made her specific objections clear. She instead has voiced general grievances regarding broad spending and tax hikes on high-income earners.
The two moderate Democrats have already forced months of negotiations that resulted in the House version of the package being scaled down significantly, but additional efforts to further prune the act will likely risk alienating more progressive Democrats, whose votes are as equally essential to final passage.
Democrats will also need to make sure their package follows the strict rules outlined under the reconciliation process, which requires that all provisions have a direct fiscal impact and has already forced Democrats to drop certain wishlist plans, including providing a path to citizenship for undocumented immigrants.
Despite the daunting hurdles, Democratic leaders said they hope to pass a final version of the act before the end of the year, though they may be delayed by a series of pressing fiscal deadlines.
See what others are saying: (The Washington Post) (NPR) (The New York Times)
Donald Trump and Eldest Three Children Hit With Fraud Lawsuit From New York AG
AG Letitia James says that the former president “falsely inflated his net worth by billions of dollars to unjustly enrich himself.”
Lawsuit Filed Against Trump
New York Attorney General Letitia James announced on Wednesday that she filed a civil lawsuit against former president Donald Trump and his three eldest children over allegations that they fraudulently inflated asset valuations within the Trump Organization.
Donald Trump Jr., Eric Trump, and Ivanka Trump are all listed alongside their father in the lawsuit. Executives Jeffrey McConney and Allen Weisselberg, the latter of whom recently pled guilty to tax crimes, are also listed alongside other Trump businesses.
“Donald Trump, with the help of his children…and senior executives at the Trump Organization, falsely inflated his net worth by billions of dollars to induce banks to lend money to the Trump Organization on more favorable terms than would otherwise have been available to the company, to satisfy continuing loan covenants, to induce insurers to provide insurance coverage for higher limits and at lower premiums, and to gain tax benefits, among other things,” a press release announcing the lawsuit claimed.
The Attorney General’s office claims that between 2011 and 2021, Trump and the Trump Organization made 200 false and misleading claims about asset values on annual financial statements.
The lawsuit was filed Wednesday in a State Supreme Court in Manhattan.
“The complaint demonstrates that Trump falsely inflated his net worth by billions of dollars to unjustly enrich himself and to cheat the system, thereby cheating all of us,” James said while announcing the complaint.
Her office is seeking to permanently ban Trump and his children from serving as an officer or director in any New York corporation and to bar Trump and his organization from entering into any New York real estate acquisitions for five years. The office is also seeking to recover $250 million in penalty payments, among other forms of relief.
The Office of the Attorney General has also referred the matter to the federal attorneys in New York and to the IRS for criminal investigation.
“There aren’t two sets of laws for people in this nation: former presidents must be held to the same standards as everyday Americans,” James added in a statement on social media.
“Trump’s crimes are not victimless,” she continued. “When the well-connected and powerful break the law to get more money than they are entitled to, it reduces resources available to working people, small businesses, and taxpayers.”
Trump Allegedly Inflated Key Assets
According to James’ release, Trump “made known through Mr. Weisselberg that he wanted his net worth on his statements to increase every year.”
“And the statements were the vehicle by which his net worth was fraudulently inflated by billions of dollars year after year,” the release continued.
Among the assets Trump and his organization allegedly inflated was the Trump Tower Triplex, an apartment Trump allegedly claimed was 30,000 square feet when it is just around 11,000 square feet. Because of its ballooned size, the property was valued at $327 million in 2015, roughly three times as much as the sole apartment in New York City to ever sell for over $100 million at the time.
For further comparison, the highest sale for a listing in Trump Tower at the time was only $16 million.
Trump also allegedly claimed Mar-a-Lago was valued as high as $739 million based on the “false premise” that the property could be developed and sold for residential use. The lawsuit claims that Trump actually signed deeds donating those rights, limiting the property’s use to a social club. James and her office claim its value would fall closer to $75 million.
Inflated Clauations Cannot Be “Excused”
“The inflated asset valuations in the Statements cannot be brushed aside or excused as merely the result of exaggeration or good faith estimation about which reasonable real estate professionals may differ,” the lawsuit states, adding that instead, they are the result of improper methodology intentionally meant to falsely boost Trump’s net worth.
The investigation into Trump’s alleged fraud began nearly three years ago, and the former president has repeatedly called it a politically motivated witch hunt. His attorney, Alina Habba, doubled down on that rhetoric in a statement Wednesday.
“Today’s filing is neither focused on the facts nor the law – rather, it is solely focused on advancing the Attorney General’s political agenda,” Habba said. “We are confident that our judicial system will not stand for this unchecked abuse of authority, and we look forward to defending our client against each and every one of the Attorney General’s meritless claims.”
For his part, Trump has blasted the lawsuit on Truth Social, calling James a “fraud” and a “crime-fighting disaster.”
Trump previously tried to impede the probe but was ultimately ordered by a judge to sit for a deposition and turn over subpoenaed documents. Reports say he pled the fifth hundreds of times during his deposition.
See what others are saying: (Bloomberg) (The Washington Post) (Reuters)
Hurricane Fiona Causes “Catastrophic” Damage in Puerto Rico, Leaving Many Without Power
While power has been restored to some, more than a million remain without it as continued rainfall, flooding, and landslides are expected to cause further damage across the island.
Hurricane Fiona Wreaks Havoc
Hurricane Fiona made landfall in Puerto Rico Sunday, bringing heavy rains, flooding, and landslides, while also knocking out power for the entire island and killing at least one person.
Photos and videos posted on social media show floodwaters consuming major streets and engulfing cars. Some pictures show an entire bridge flooded, making it impassible. Other footage shows a different bridge entirely uprooted and a metal barrier ripped away from the road and floating down a river of floodwater.
Officials have said conditions are still too dangerous to fully evaluate the extent of the crisis. In remarks to the public, Puerto Rico’s governor, Pedro Pierluisi, described the damage as “catastrophic.”
He asserted that the storm has been one of the most significant since Hurricane Maria — which hit the island almost exactly 5 years ago to the day — killing more than 3,000 people, leaving many without power for months, and causing destruction that the island is still recovering from.
Pierluisi noted that Puerto Rico has received over 30 inches of rain and that some areas have even gotten more rain than during Hurricane Maria. As of Monday afternoon, the National Gaurd has led 30 rescue operations so far, saving more than 1,000 stranded residents in 25 municipalities, according to the governor.
Pierluisi also added that more than 2,000 people were in the island’s 128 shelters, with officials further saying there is plenty of shelter space for those who need it. On Sunday, President Joe Biden approved an emergency declaration for Puerto Rico, which will allow federal agencies to coordinate disaster relief.
Continued Issues As Storm Rages On
Meanwhile, Puerto Rico’s water authority has confirmed that just over 70% of the island is still without water. According to poweroutage.us, more than 1.3 million customers were still without power as of Monday morning.
The power company LUMA also stated that electricity had been restored to around 100,000 customers over the course of Sunday night, though it previously warned that the full restoration of power could take several days as the storm has created “incredibly challenging” conditions.
While Hurricane Fiona has passed through Puerto Rico, having now made landfall in the Dominican Republic, officials and experts say that heavy rains and further flooding are still to be expected for the next few days.
The National Weather Service has warned that “life-threatening and catastrophic flooding” as well as mudslides and landslides are expected to continue across the island. As a result, Pierluisi has urged Puerto Ricans Monday to remain home and in shelters so that officials can continue to respond to others in need.
He also noted that the areas most impacted by the hurricane include the southern part of the island, the southwest, and the mountains.
After moving through the Dominican Republic, Hurricane Fiona is expected to head towards Turks and Caicos Tuesday. The National Hurricane Center has said that the storm will continue to grow and by Wednesday, it is set to become a major hurricane — which means a Category 3 or higher.
See what others are saying: (The New York Times) (The Washington Post) (CNN)
Government Aid Cut Child Poverty in Half During Pandemic, Data Shows
The reduction occurred similarly across geography, race, family type, and citizenship status.
Largest Drop in Half a Century
The United States’s child poverty rate sank to the lowest level on record last year, primarily thanks to pandemic relief measures and other government programs, according to an analysis of census data released Tuesday.
The Center on Budget and Policy Priorities analyzed data from the Census Bureau’s supplementary poverty measure, which accounts for safety net programs and tax credits as well as regional differences in the cost of living.
From around 11% in 2019, the percentage of kids living below the poverty line fell to 9.7% in 2020 and 5.2% the year after that.
In just two years, nearly 5.5 million kids were lifted from poverty, marking an almost 60% drop in the child poverty rate.
The Center’s researchers gave most credit to the federal government’s numerous interventions in the economy, from stimulus payments and the expanded child tax credit to eviction moratoriums and expanded unemployment insurance.
Without government intervention, poverty in 2020 would have experienced its second-largest recorded increase, the Center claimed, but instead, it underwent the largest single-year decline in over half a century.
Especially impactful was the expanded child tax credit, which sent up to $300 per child to households with children every month between July and December 2021.
According to the analysis, this policy alone pulled nearly three million kids out of poverty.
But the tax credit’s expansion expired at the end of the year despite Democrats’ efforts to prolong it with Biden’s signature Build Back Better bill, which was blocked by Sen. Joe Manchin (D-WV), who reportedly told colleagues he was concerned that families might use the payments to buy drugs.
Poverty Before COVID
Child poverty has fallen by 59% since 1993, when it sat at around 28%, according to another analysis published Sunday by The New York Times and the nonpartisan group Child Trends.
They found that the decline occurred across all 50 states and D.C., as well as in different levels of poverty.
It similarly affected nearly all subgroups of children, — white, Black, Asian and Hispanic, single-parent and two-parent, immigrant and non-immigrant.
The causes driving the pre-pandemic decline included general economic improvement — low unemployment, a higher labor force participation rate among single mothers, and growing state minimum wages — but the researchers pinned government welfare programs as the dominant factor.
They specifically mentioned the earned income tax credit, social security, unemployment insurance, and nutrition and housing assistance.
Despite the positive trend, more than eight million children still live below the poverty line, and that number excludes those who live just above it but still struggle to meet basic needs.
The current poverty line sits around $29,000 for a family of four in a location with typical living costs.
Moreover, disparities still persist, with Black and Latino children about three times as likely as their white peers to be poor.