Trump on Hook to Clarify Policies With Speech to Congress
by Justin Sinkand and Margaret Talev
February 28, 2017, 2:00 AM PST February 28, 2017, 4:09 AM PST
Lawmakers, investors and the American public want President Donald Trump to provide some much-desired clarity on his policy agenda with his first address to Congress on Tuesday.
Six weeks into his presidency, Trump is under increasing pressure to answer core questions about how he’ll deliver on his promises to bring fundamental change to U.S. health-care policy, the tax system, defense spending and immigration. Explanations have been elusive so far, and his prime-time speech could determine whether markets — and voters — believe Trump has a firm handle on his job.
White House officials who previewed the speech on Monday said Trump will argue that executive actions he’s signed have already paid off for voters, and that he’s ushered in an economic renaissance merely by promising tax relief and a relaxed regulatory state.
“The president will lay out an optimistic vision for the country, crossing traditional lines of party, race, socioeconomic status,” White House press secretary Sean Spicer said on Monday. “The theme will be the renewal of the American spirit. He will invite Americans of all backgrounds to come together in the service of a stronger and brighter future for our nation.”
Shift of Narrative
The speech will offer Trump a chance to shift the narrative on a presidency that so far has been marked by by a freewheeling leadership style and signs of chaos. Protests, staffing troubles and continued suspicions of his campaign’s connections to the Russian government have defined the short span of Trump’s term so far, overshadowing a buoyant economy and record highs in stock markets.
Trump sought to provide some answers on how his proposed budget would pay for a 10 percent increase in spending on defense without cutting “entitlement” programs such as Social Security and Medicare, which make up about two-thirds of the $4 trillion federal budget, in an interview with Fox News that aired Tuesday.
“I think the money is going to come from a revved-up economy,” Trump said. The U.S. gross domestic product will be “a little more than 1 percent and if I can get that up to 3 and maybe more that’s a whole different ballgame,” he said.
Trump said other factors involved in paying for his budget are job creation and seeking more money from other nations for help the U.S. provides. “When we help them, even militarily, we’re going to ask then for reimbursement.”
Spicer said Trump will lay out a legislative agenda including details on tax and regulatory overhauls that are sought hungrily by investors.
U.S. stocks have led a global rally in riskier assets since Trump’s election, though gains have also come amid strengthening fundamentals from corporate profits to economic data. Almost $3 trillion has been added to the value of U.S. stocks since Nov. 8, as the S&P 500 Index has surged 11 percent to a record and the Dow Jones Industrial Average just capped a 12th day of closing at an all-time high, matching its longest-ever streak set in 1987.
Foreign currency markets have lost some of their enthusiasm for the Trump trade, with the U.S. dollar lower by more than 3 percent since Jan. 3 after surging 6.5 percent following the election, according to the Bloomberg Dollar Spot Index.
Trump’s expected to outline homeland protection measures including new immigration restrictions and border security spending. Trump has said he will also discuss his plans to replace the Affordable Care Act, known as Obamacare, a proposal of keen interest to health insurers including UnitedHealth Group Inc. and Anthem Inc. and hospital chains including HCA Holdings Inc.
Congressional Republicans will look for any endorsement by Trump of a border-adjusted tax, a roughly $1 trillion revenue-raiser that sits at the heart of House Speaker Paul Ryan’s plan to slash corporate and individual tax rates. The plan is struggling for support, and proponents are eager for a boost from Trump, who has so far sent mixed signals on the proposal.
Under the border-adjustment plan, the current corporate income tax would be replaced with a 20 percent levy on imports and domestic sales, while exempting exports. The measure has stirred sharp divisions among businesses: Retailers, automakers and oil refiners that rely on imported goods and materials oppose it, while export-heavy manufacturers support it. Critics argue that the plan would raise prices for consumers, while proponents say that, in theory, international currency-exchange rates will adjust to prevent raising consumer prices or favoring exporters.
Trump has shown signs of breaking from congressional Republicans on Obamacare. Governors meeting in Washington on Saturday were presented with an analysis of a House Republican repeal bill that suggested many people may lose their insurance under the measure and states would lose billions of dollars. Trump has previously vowed that no one would lose their coverage.
There are divisions among congressional Republicans over whether a replacement plan should subsidize insurance, and if so how generously and how to finance such a policy. Trump may use his speech to push one side to compromise, particularly since it’s clear he’s getting impatient.
Virginia Governor Terry McAuliffe, chairman of the National Governors Association, said Trump asked Health and Human Services Secretary Tom Price when a bill would be proposed during a meeting Monday with the governors group. Price told Trump a bill would be delivered in three or four weeks.
“Trump said, ‘I want it in two.’ Or something like that,” McAuliffe said.
Groups critical of Trump’s policies are organizing protests ahead of the speech.
Congressional Democrats announced they had invited several guests intended to send pointed messages to the new president, including undocumented immigrants. The House Democratic Women’s Working Group is encouraging all the female lawmakers in the party to wear white, the color of the suffragette movement, for the president’s address.
Rosie O’Donnell, a comedian with whom Trump has long had an openly hostile relationship, was billed as a headliner for a protest event called the “Resistance Address” to take place outside the White House. The rally was expected to draw members of the ACLU, MoveOn.org Civic Action, health and environmental advocacy groups and organizations representing gays, immigrants, and minorities.
Senator Kamala Harris, a California Democrat, announced her guest for Trump’s address will be a biomedical researcher who was the first student to earn a PhD. under the protections of the Deferred Action for Childhood Arrivals program, created by former President Barack Obama to shield children brought to the U.S. without immigration papers from deportation. Trump has so far continued the program.
The president also is inviting guests who are representative of issues he intends to highlight. Among those sitting with first lady Melania Trump on Tuesday will be Maureen McCarthy Scalia, the widow of the late Supreme Court Justice Antonin Scalia. The Senate Judiciary Committee begins hearings next month on Trump’s nominee to fill the Scalia vacancy, federal appeals court judge Neil Gorsuch.
Also in the first lady’s box will be Jessica Davis and Susan Oliver, the widows of two California law enforcement officers who were killed in the line of duty by an undocumented immigrant. Another guest is Jamiel Shaw Sr., whose son was shot by a gang member in the country illegally, according to the White House.
One issue on which Trump has been largely silent is how he’ll handle employers that hire and rely on undocumented workers, such as farmers, meat-packers, restaurateurs and hoteliers. The most anti-immigrant, populist wing of the Republican Party that has formed the base of Trump’s support strongly believes that employers must be targeted in order to make a dent in undocumented immigration. More mainstream Republicans have in previous years pushed simply for more legal avenues of immigration, such as additional skilled-worker visas and other temporary worker programs.
Immigration attorneys expect it’s only a matter of when — not if – Trump will shift his focus to employers. Under former president Barack Obama, the government scaled back workplace raids employed under George W. Bush that saw thousands of undocumented workers marched from meatpacking plants in handcuffs and deported. Robert Loughran, a partner at immigration law firm Foster LLP, says that his firm has already started hiring new attorneys and legal assistants to prepare for any drastic action against employers.
“We’re gearing up for a series of work site raids in the next 90 days,” said Loughran.
Trump told governors at the White House on Monday that he’s going to have “a big statement tomorrow night on infrastructure” and “we’re going to start spending on infrastructure big.” But governors said afterward the president didn’t share the details with them.
The president has vowed to raise as much as $1 trillion over the next decade to upgrade aging roads, bridges, airports and other assets. The program would rely on the private sector, but Trump otherwise hasn’t said how it would be funded or what types of infrastructure will qualify.
“We spend $6 trillion in the Middle East and we have potholes all over our highways and our roads,” Trump said. “So, we have to fix our infrastructure. It’s not like we have a choice. We have no choice, and we’re going to do it.”
Democrats and some Republicans say the nation’s needs won’t be met without more direct federal spending.
Ryan has said he wants to see $40 in private spending for each additional tax dollar spent on infrastructure, and Senate Majority Leader Mitch McConnell has said he will oppose a stimulus spending plan. Congressional Democrats say they are willing to work with Trump on an infrastructure plan but not if it is focused on a tax credit or other incentives for private investment.
Democrats’ expectations for the speech are low. Senate Democratic Leader Chuck Schumer of New York said he expects Trump to use populist rhetoric and “grandiose promises” to the working class while promoting policies that undercut them.
“It will be all the usual bluster and blame,” Schumer said.