Aug 24, 2017

Government shutdown chances rising by the day

Carolyn Kaster / AP

Top White House and GOP leadership officials tell us the chances of a market-rattling government shutdown are rising by the day — and were even before Trump threatened at his raucous Phoenix rally on Tuesday night to use a shutdown as leverage to get funding for a border wall. Trump is dead serious about this fight, a senior administration source tells us, and the president's talk is starting to spook markets.

  • Goldman Sachs, in guidance to investors last Friday, pegged the odds at 50/50. This strikes us as high, but the dynamics are ominous:
  • A top Republican source put the chance as high as 75%: "The peculiar part is that almost everyone I talk to on the Hill agrees that it is more likely than not."
  • This may all come down to Trump's mood: The president is spoiling for a fight and the [conservative House] Freedom Caucus haven't had a fight for a while. That's a dangerous dynamic.

Based on funding mechanisms, the showdown could come either in September or December — or both:

  • Officials at both ends of Pennsylvania Avenue who are up to their necks in tax reform think passage probably doesn't happen until early next year.
  • So a September shutdown could be better for tax reform than a Christmas shutdown, because it would allow conservatives and Trump to get it out of their system.

Democrats feel certain they have Trump boxed in, and see no reason to compromise/help:

  • Trump is at war with Senate Leader McConnell and several other Republicans, complicating communications and compromising trust.
  • Congressional leadership doesn't want a shutdown and can pass the fall bare necessities — continuing resolution / debt ceiling / Children's Health Insurance Program extension — using mostly Democratic votes.
  • But the Freedom Caucus will hammer Speaker Ryan for doing so, and conservatives in the Senate will hammer Leader McConnell.

Be smart: With the departure of Steve Bannon, Trump is surrounded more and more by conventional/mainstream folks, which could actually make him feel more compelled to buck them.

Go deeper

17 seconds ago - Politics & Policy

McConnell blocks resolution condemning Trump's actions against peaceful protesters

Senate Majority Leader Mitch McConnell (R-Ky.) blocked a resolution introduced by Minority Leader Chuck Schumer (D-N.Y.) on Tuesday that would have condemned the use of tear gas and rubber bullets against peaceful protesters outside the White House on Monday in order to allow President Trump to walk to St. John's church.

What they're saying: "Justice for black Americans in the face of unjust violence, and peace for our country in the face of looting, riots, and domestic terror. Those are the two issues Americans want addressed," McConnell said on the Senate floor.

George W. Bush breaks silence on George Floyd

Goerge Bush in Michigan in 2009. Photo: Bill Pugliano/Getty Images

Former President George W. Bush (R) wrote in a statement Tuesday that he and his wife, Laura, are "anguished" by the death of George Floyd, and said that "it is time for America to examine our tragic failures."

Why it matters: It's a stark juxtaposition when compared to fellow Republican President Trump's response to current civil unrest. While Trump has called for justice in Floyd's death, he's also condemned protestors and threatened to deploy military personnel if demonstrations continue.

Updated 57 mins ago - Politics & Policy

Updates: George Floyd protests continue for 8th day

Police officers wearing riot gear push back demonstrators outside of the White House on Monday. Photo: Jose Luis Magana/AFP via Getty Images

Protests over the death of George Floyd and other police-related killings of black people continued across the U.S. for the eighth consecutive day, prompting a federal response from the National Guard, Immigration and Customs Enforcement and Customs and Border Protection.

The latest: The Minnesota Department of Human Rights announced an investigation on Tuesday into the conduct of the Minneapolis Police Department over the past decade, after filing a civil rights charge related to the death of George Floyd.