Jul 5, 2019

Axios AM

By Mike Allen
Mike Allen

⚡ Breaking ... The U.S. economy added 224,000 jobs in June — far more than the 165,000 economists were expecting, Axios markets reporter Courtenay Brown writes.

🏖️ Happy summer Friday. If you're working today, thank you! If you have the blessing of a long weekend, soak it in.

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1 big thing: How the Supreme Court will upend 2020

Illustration: Rebecca Zisser/Axios

The Supreme Court is already poised to drop some big political bombshells right into the heat of the 2020 campaign. And there are even more waiting in the wings, Axios' Sam Baker writes.

  • Why it matters: The court will likely hand down rulings on some of the most contentious issues in American politics just a few weeks before the Democratic convention (which will be in Milwaukee in mid-July). That will be a reminder of just how often the justices effectively have the final say — and that 2020 is a race to pick the next justices.
  • The court’s next term will “probably help to crystalize people’s thinking in the political season about the importance and the role of the court,” said Leonard Leo of the Federalist Society, a key adviser on President Trump’s Supreme Court nominations.

The lineup:

  • The justices have taken their first big Second Amendment case in over a decade — a challenge to New York City’s restrictions on transporting guns.
  • They’ll also decide whether Trump has the power to end the Obama-era immigration program known as DACA, which shields about 700,000 young adults and children from deportation.
  • And they’ll decide whether federal civil-rights law prohibits employers from firing workers because they’re gay or transgender.

There’s more on the way.

  • The justices are likely to take up an abortion case out of Louisiana.
  • Yet another challenge to the Affordable Care Act is also working its way through the system. Depending how things play out in a federal appeals court, it could land on the high court’s docket before Election Day.

Between the lines: Trump's ability to steer the court to the right, and specifically the presence of Justice Brett Kavanaugh, looms large in all of these cases.

  • New York is now trying to undo its own gun rules, hoping to scuttle the Supreme Court case rather than risk a loss that could jeopardize other gun laws.
  • Louisiana's abortion restrictions are highly similar to ones the court struck down in 2016 — but with then-Justice Anthony Kennedy as the decisive vote. Kennedy was also a consistent advocate for LGBT rights.

All these cases carry major legal and political implications:

  • DACA is a question of executive power. And immigration is central to Trump's 2020 campaign, just as gun control animates Democratic candidates.
  • These rulings, at least some of which will likely come at the end of next June, would be hard for either Trump or the Democratic nominee to avoid — even if they wanted to, and they may not want to.

Traditionally, conservative voters are more focused on the courts than liberals.

  • That was evident in 2016, when the court's vacant seat helped Trump rally a base of both evangelical activists and establishment Republicans.

The bottom line: If Trump is reelected and able to replace a liberal justice — or even if a Republican Senate blocks a Democratic president from filling lower-court vacancies — the judiciary could become a roadblock that stymies Democrats for generations.

2. "Two-tier recovery": 40% of Americans struggle to pay bills

This is a "two-tier recovery," Matthew Mish, head of credit strategy at the investment bank UBS, told the WashPost's Heather Long for a front-page article, "In boom times, struggling to get by":

  • "About 60 percent of Americans have benefited financially, he said, while 40 percent have not."
  • "The 40 percent — which Mish calls the 'lower tier' — have seen paltry or volatile wage growth, rising expenses for housing, health care and education, and increased levels of personal debt."

Why it matters, from The Post: "Economists fear such precarious financial situations put many Americans at risk if there is even a mild setback in the economy, potentially setting up the next recession to be worse than anything in recent history except the Great Recession."

  • "So many Americans are living paycheck to paycheck," said Signe-Mary McKernan, vice president of the Center on Labor, Human Services and Population at the Urban Institute.
  • "We are headed toward a political crisis, if not an economic one."

Worthy of your time.

3. Wall Street warms (begrudgingly) to Elizabeth Warren
Sen. Elizabeth Warren speaks Tuesday in Vegas. Photo: John Locher/AP

Sen. Elizabeth Warren, "who rose to national prominence by calling for tough regulation after the financial crisis, is winning respect from a small but growing circle of senior bankers and hedge fund managers," Bloomberg's Lananh Nguyen and Tyler Pager write.

  • As she "takes aim at the 'rich and powerful' with a slew of tax-raising policy proposals, some financial types who fit that description say she’s proven capable and makes some good points."

David Schamis, chief investment officer of Atlas Merchant Capital, told Bloomberg that while Warren isn’t his top choice, he'd have no trouble supporting her if she were the Democratic nominee:

  • "I think she is smart, hardworking, responsible and thoughtful. And I think she thinks markets are important."
  • Schamis said people in his network who studied under Warren at Harvard Law "think highly of her, including some conservatives."
Bonus: Pics du jour
Photo: Alex Brandon/AP

The U.S. Army Band played during a Navy Blue Angels flyover at the end of an Independence Day celebration in front of the Lincoln Memorial.

  • President Trump stuck to his script and avoided politics as he celebrated the story of America as "the greatest political journey in human history." (AP)
  • Trump vowed: "Very soon, we will plant the American flag on Mars" — a distant goal not likely to be achieved until late in the 2020s, if then.
Photo: Carolyn Kaster/AP

President Trump watches the military flyovers.

Photo: Susan Walsh/AFP/Getty Images)

How it's playing ... N.Y. Times: "President Plays M.C." ... WashPost: "A divided America gathers for Fourth" ... L.A. Times: "Trump injects himself into D.C.’s Fourth of July, changing the tone with his demands and personality."

4. Biden speaks

Photo: CNN

Joe Biden is "looking forward" to a chance to debate President Trump, the former VP told CNN's Chris Cuomo in an interview airing today.

  • "You walk behind me in the debate. Come here, man." (In the 2016 debate, Trump walked behind Hillary Clinton.)
  • "The idea that I'd be intimidated by Donald Trump. He's the bully that I knew my whole life. He's the bully that I've always stood up to. He's the bully that used to make fun when I was a kid that I stutter, and I'd smack them in the mouth."

Biden on Trump:

  • China: "While he's tweeting, China's going to own the 5G market."
  • North Korea: "Look, you want to talk, you want to deal with us, you want sanctions lifted. Show me something ahead of time."
  • Russia: "He's embracing Putin, who is a flat dictator."
  • NATO: "If [Trump] wins re-election, I promise you, there will be no NATO in 5 years."

And Biden on Democrats, per CNN:

  • Said he "wasn't prepared for" Kamala Harris' challenges on busing and civil rights.
  • Told CNN "busing did not work': "You had overwhelming response from the African American community in my state," Biden said of Delaware. "They were, they did not support it. They did not support it."
  • "Suggested that 'Medicare for All' is irrational."
  • "Argued that the majority of Democrats are 'center left' not 'way left.'"
  • "Said Rep. Alexandria Ocasio-Cortez ... did not represent Democrats who can win a general election in a competitive district or state."
5. "Cleanup on aisle 6, 7, 8 ... "
Stater Bros. supermarket in Ridgecrest, Calif., where the quake was based (Photo: Adam Graehl via AP)

"The largest earthquake in two decades [6.4] rattled Southern California, shaking communities from Las Vegas to Long Beach and ending a quiet period in the state’s seismic history," the L.A. Times reports.

  • Seismologist Lucy Jones said: "This does not make [the Big One] less likely. There is about a 1 in 20 chance that this location will be having an even bigger earthquake in the next few days, that we have not yet seen the biggest earthquake of the sequence."
6. About last night
Andrew Caballero-Reynolds/AFP/Getty Images)

Thank you, America!

Mike Allen