The conservative tax and health care strategy that might blow up Obamacare repeal - Axios
Featured

The conservative tax and health care strategy that might blow up Obamacare repeal

AP Photo/Lauren Victoria Burke

The House Freedom Caucus voted Monday night to oppose anything less than the aggressive 2015 Obamacare repeal bill, formalizing the deep division among Republicans about what to do with the health care law. Earlier Monday, Chairman Mark Meadows sat down with me to talk about what he does want, for both health care and tax reform. While he wants Obamacare repeal to happen fast, he eventually wants to combine its replacement with tax reform in the same package.

What's next: Figuring out whether moderates can stomach a straight repeal for now, with the assurance of a replacement to come in tax reform later this year, or whether this is just an opening bid from conservatives and they'll eventually submit to leadership's plan. If it's the former, Obamacare repeal might die.

Meadows wants as much of Obamacare as possible repealed in the next 30 days. When that's over, the House can get to work on passing the replacement and its tax reform agenda. That likely means combining the two efforts.

This is not exactly what leadership has in mind. It's trying to add as much of an Obamacare replacement as possible to the repeal bill, a strategy first advocated by moderates afraid of repealing the law without immediately replacing it. Meadows also has different ideas about tax reform, preferring to leave out a border adjustment tax — a key part of House leadership's plan.

He admits the danger in lumping the two huge policy efforts together. "When you put two very difficult concepts together, tax reform and Affordable Care Act, it lowers your thresholds in terms of the number of votes that you can or cannot get in terms of the Senate, whether it's 50 or 51," he told me.

"I think it would be very difficult" to combine the two efforts, Senate Finance Chairman Orrin Hatch told reporters Monday.

But some of the moderates pushing for passing a repeal and replacement at the same time might be open to the idea. "I think you could probably all do it in the second," Sen. Bill Cassidy told me in a hallway interview Monday.

The situation: Republicans have two different opportunities to pass major legislation without Democrats through a process called budget reconciliation. The plan has been to use the first reconciliation bill on Obamacare repeal and replace and the second on tax reform. But while leadership has been exploring how much of a replacement it can fit into the repeal bill, Meadows — along with a growing number of conservatives — are saying they want repeal and replacement done in separate bills voted on at the same time. He then wants to use the second reconciliation to replace Obamacare, along with tax reform.

Here's what he wants:

  1. Within the next 30 days, a vote on full repeal of Obamacare. This includes the individual mandate, the employer mandate and the law's insurance regulations. While these laws weren't included in a 2015 repeal bill because of reconciliation rules, Meadows thinks there are ways around that.
  2. Immediately vote on a replacement plan, also within the next 30 days. The replacement must include a way of dealing with pre-existing conditions. Assume it doesn't pass the Senate filibuster.
  3. Potentially vote on a tax reform package under normal procedure, without the border adjustment tax. Meadows thinks this would have a chance of passing with some Democratic support in the Senate.
  4. Include Obamacare replacement in the second reconciliation bill "that is, quote, being used for tax reform, but it doesn't have to be just used for tax reform."
House conservatives are generally united in their Obamacare strategy.

Ok, but: Putting an Obamacare replacement and tax cuts in the second reconciliation bill — without a border adjustment tax — will cost a ton of money. It's unclear where that money will come from, but it could very well require the bill to need 60 votes in the Senate if it's not paid for. Democrats are very unlikely to help pass anything Republicans put forward after an Obamacare repeal, especially if they also don't like the tax components. Republicans know this and could be very unwilling to jeopardize tax reform in this way.

Featured

Ex-Y Combinator COO working on self-driving car startup

via QasarYounis.com

Qasar Younis, a former Google product manager who was most recently chief operating officer at startup accelerator Y Combinator, is quietly working on an autonomous driving startup, Axios has learned from multiple sources.

The details: The company is said to be working on simulation software for self-driving cars, and is finalizing a $10 million funding round led by Andreessen Horowitz (with Marc Andreessen joining the board of directors). Andreessen Horowitz declined comment, while Younis did not return requests for comment.

Background: Younis left Y Combinator in March after four years at the famed Silicon Valley accelerator. Before that, he spent three years as a product manager at Google, which he joined after the search giant acquired his startup (and YC alum) TalkBin. Early in his career, Younis was an engineer with General Motors.

Featured

Kim Jong-un: "Deranged" Trump will "pay dearly" for threats

A man watches a TV news program on a public screen showing an image of North Korean leader Kim Jong Un. Photo: Eugene Hoshiko / AP

North Korea's Supreme Leader Kim Jong-un said Trump will "pay dearly" for his speech calling for destruction of the DPRK. Kim released a statement saying he thinks Trump's speech shows "mentally deranged behavior" and that Trump "is unfit" to serve at the "command of a country." He called Trump a "rogue and a gangster fond of playing with fire, rather than a politician."

The key line: Now that Trump's made "the most ferocious declaration of a war in history that he would destroy the DPRK, we will consider with seriousness exercising of a corresponding, highest level of hard-line countermeasure in history"

Go deeper with our Expert Voices conversation on how war with North Korea would unfold

Featured

U.S. and Russia hold secret talks "somewhere in Middle East"

Alexei Druzhinin, Sputnik, Kremlin Pool Photo via AP

Senior representatives from the U.S. and Russian militaries met in an undisclosed location "somewhere in the Middle East" to discuss the tensions surrounding the anti-ISIS fight in Syria, the AP reports. Army Col. Ryan Dillon wouldn't tell reporters who was there or how long the meeting was.

  • Why pay attention: This is a potential violation of the U.S. ban on military-to-military cooperation with Russia in light of Russia's annexation of part of Crimea. Plus, it shows an increased willingness to coordinate efforts in the region as Russian forces are deployed alongside pro-Syrian forces in the effort to take Deir el-Zour, a strategically significant city in Eastern Syria currently held by ISIS. Russia has warned it would retaliate if Russian forces are attacked.
  • What they discussed: Where forces are located around Deir el-Zour.
  • Up next: Col. Dillon said he wasn't disclosing the location since there might be more talks.
Featured

Haley: I don't want to be Secretary of State

U.N. Ambassador Nikki Haley during the U.N. General Assembly. Photo: Bebeto Matthews / AP

During a press conference this afternoon, U.N. Ambassador Nikki Haley told reporters that while "there's going to be chatter" surrounding her job, she is simply trying "to do a good job and I'm trying to be responsible in my job…I'm trying to serve the president of this country as best I can."

Do you want to be Secretary of State? "No, I do not."

More on the situation around the globe:

  • North Korea: "We're not gonna run scared…If North Korea attacks the United States or our allies, the United States will respond. Period."
  • Myanmar: "The president is very concerned…It's something a lot of us can't stomach." Haley added that Secretary of State Rex Tillerson had spoken to the de facto leader of Myanmar, Aung San Suu Kyi, earlier this week.
  • Iran: "If we don't do something and we make the same mistakes we made with North Korea, we will be dealing with an Iran that has nuclear weapons and ballistic missile technology."
Featured

Mueller seeks phone records on first Trump Jr.-Russia statement

Mueller departs the Capitol after a closed-door meeting with members of the Senate Judiciary Committee. Photo: J. Scott Applewhite / AP

Special Counsel Bob Mueller has requested phone records relating to the initial, misleading statement about the Trump Tower meeting between Donald Trump Jr. and a Russian lawyer that was drafted aboard Air Force One, Politico reports, citing two people "familiar with the investigation."

Why it matters: President Trump helped draft that statement, which carries legal risk.

Go Deeper: Russia probe narrows in on 13 categories, including meetings between Trump and Comey.

Featured

Manafort's continuing to work on affairs abroad

AP Photo / Carolyn Kaster

Trump's former campaign chairman Paul Manafort is working on the Kurdish independence referendum now, which the U.S. opposes over fears it could destabilize Iraq and the fight against ISIS, the NYT reports.

Context: Manafort's foreign lobbying jobs in the past have gotten him in hot water: The government investigation into him began in 2014 over his consulting in the Ukraine; a new investigation opened in 2016; and the news recently surfaced that the government wiretapped him before and after the election under FISA court orders, which were reportedly part of an effort to understand foreign powers.

  • A spokesman for one of the leaders of the referendum movement confirmed Manafort is working on it, but wouldn't detail in what capacity.
  • The referendum is scheduled for Monday.
  • Manafort has not yet registered with the Department of Justice under the Foreign Agents Registration Act for the referendum work. Manafort's spokesman, Jason Maloni, said if his work requires registration, he will. The White House and the DOJ didn't immediately respond to requests for comment.

One key point: Former American diplomat, Peter W. Galbraith, told the NYT "they're a foreign country who wants to get international recognition, and if you can get somebody who is close to the president of the United States to be your advocate, then that could help."

This isn't the only project Manafort's working on abroad:

  • He's advising a billionaire in China on infrastructure contracts.
  • He's working on a plan linked to the Chinese government's China Development Bank related to Puerto Rico's bond debt.
  • He met with Lenin Moreno, now the president of Ecuador, earlier this year about investment opportunities.

Go deeper:

Featured

Study: Flint water crisis caused reproductive issues

The Flint Water Plant tower in Flint, Michigan. Photo: Carlos Osorio / AP

The water crisis in Flint caused a variety of serious issues for both fetuses and newborns and their mothers due to increased levels of lead, according to a new study by Kansas University researchers cited in the Detroit Free Press.

By the numbers: After the city began using the Flint River as its water source in April 2014, fetal death rates jumped by 58% while fertility rates for women dropped by 12%, per the study.

  • The researchers compared birth rates and fetal death data from Flint and 15 other large cities in Michigan, telling the Detroit Free Press that "Flint's numbers fell off a cliff" after the water switch while the other cities remained constant.
  • The babies born in Flint after the water switch were born earlier and an average of 150 grams lighter than in other Michigan cities. They also gained weight slower in their first weeks.

Worth considering: The study has not been peer-reviewed yet, but the Kansas researchers hope that their work will spur other studies to confirm their findings and instigate changes in policy.

Featured

Facebook will turn over Russian-bought ads to Congress

Jeff Chiu / AP

Facebook will give congressional investigators access to the more than 3,000 ads bought by Russian operatives during the campaign, it said on Thursday, reversing a previous decision that had drawn criticism. It also said it would increase transparency around political ad spending in a move that gets ahead of any new disclosure rules lawmakers could try to impose on digital campaign ad spending.
Details: Facebook had previously said it hadn't provided that information to congressional investigators, citing privacy concerns and federal law, but had provided the information to Special Counsel Robert Mueller. Colin Stretch, the company's general counsel, said Thursday that the decision had been made after a legal review.
"We believe it is vitally important that government authorities have the information they need to deliver to the public a full assessment of what happened in the 2016 election," said Stretch in a blog post. "That is an assessment that can be made only by investigators with access to classified intelligence and information from all relevant companies and industries — and we want to do our part."

New rules for political ads: In what is perhaps the most drastic change for advertisers and ad buyers, Zuckerberg said that in the coming months they will not only require that advertisers have to disclose which page paid for an ad, "but we will also make it so you can visit an advertiser's page and see the ads they're currently running to any audience on Facebook."

In a separate post, Facebook issued a set of answers to questions around the probe. Key takeaways:
  • Facebook says it didn't know when the ads were purchased that they might be part of a Russian operation because they were uploaded using Facebook's self-service tool, and weren't sold directly from a Facebook salesperson to a client.
  • The company says it's possible there are more ads from Russian or other foreign actors using fake accounts, but it is actively looking for this type of abuse. "It's possible that government investigators have information that could help us," said Elliot Schrage, the company's top policy executive, in the post.
What they're not doing: Releasing this information to the public.That's not likely to satisfy critics who argue there should be more transparency required about who buys digital political ads. Facebook cited "sensitive national security and privacy issues" involved in the investigation.
Key quote: "I don't want anyone to use our tools to undermine democracy," said Facebook CEO Mark Zuckerberg on Thursday. "Now, I wish I could tell you that we're going to be able to stop all interference. But that just wouldn't be realistic."
Featured

EU cracks down on Silicon Valley with new tax proposals

Kirsty Wigglesworth / AP

The European Union wants to raise taxes for some of the biggest U.S. tech companies, like Amazon, Google and Facebook, in an effort to open up competition to other businesses that service over 500 million EU customers. In a proposal laid out Thursday, EU regulators said international tax laws are outdated and suggested they would put forward new mandates if a rewrite of the international tax code didn't happen by next spring.

Why it matters: The absence of regulation to curb the dominance of tech giants has enabled them to grow so big that just a few companies own the majority of digital advertising and e-commerce revenue globally. European regulators have been far more aggressive in policing technology companies than the U.S. government and has issued several antitrust penalties, including a $2.7 billion fine against Google earlier this year.

Recommendations: EU regulators recommended several options, including an "equalization" tax, on digital revenue and a "withholding" tax on digital transactions of goods and services to companies outside of the EU.

In response, the technology industry trade group ITI released a statement urging the EU to ensure its policymaking "is consistent with the larger multilateral cooperation" and urging US lawmakers to modernize the U.S. tax code by passing pro-growth tax reform.


Featured

Mnuchin on sanctions: Do business with U.S. or North Korea, "not both"

Treasury Secretary Steve Mnuchin detailed the intent of Trump's new sanctions on North Korea at the UNGA Thursday. Photo: Alex Brandon / AP

President Trump's executive order issuing new sanctions on North Korea sends a clear signal to foreign financial institutions that they can do business with North Korea or the U.S., "but not both," said Treasury Secretary Steve Mnuchin at the UN General Assembly Thursday. "No bank in any country should be used to facilitate Kim Jon Un's destructive behavior," he said.

Mnuchin disputed that the order targets China, North Korea's largest trading partner: "This action is directed at everyone, it is in no way specifically directed at China... we appreciate the way they're working with us."