Axios - Politics
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World Bank president comments on Ivanka Trump's investment fund

Michael Sohn/ AP via pool

World Bank Group president Jim Yong Kim has released a statement about Ivanka Trump's involvement in a fund for women entrepreneurs to be administered by the World Bank (which Trump told our own Mike Allen about on Tuesday):

"The World Bank Group is working with partners on the details around creating a facility for women's economic empowerment, specifically through providing access to finance, markets, and networks. Typically, the governance of facilities we manage is decided among donors, and the secretariat sits within and is administered by the World Bank Group. We are very grateful for the leadership Ms. Trump and Chancellor Merkel have demonstrated on this important issue."

Axios' Dan Primack still has some questions about the fund, including whether Trump or adviser Dina Powell will be actively soliciting contributions while working in the White House.

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Just 36% say they'd vote to re-elect Trump

Evan Vucci / AP

Only 36% of people say they would vote to re-elect President Trump if the 2020 election were today, per a Fox news poll, compared to 55% who would vote for someone else.

Most have already made up their minds: 21% say they would definitely vote for Trump and 47% would definitely vote for someone else.

At this point in his first term, 52% said they'd vote to re-elect Barack Obama, and 31% said they'd vote for someone else.

Featured

Trump says he's considering breaking up the 9th Circuit

Carolyn Kaster / AP

President Trump has told the Washington Examiner he is "absolutely" considering breaking up the 9th Circuit, where judges have struck down both his travel ban and sanctuary cities order.

"There are many people that want to break up the 9th Circuit. It's outrageous.... Everybody immediately runs to the 9th Circuit. And we have a big country. We have lots of other locations. But they immediately run to the 9th Circuit. Because they know that's like, semi-automatic."

The circuit includes... Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon and Washington and is by far the largest of the 13 appellate circuits.

Deep breath: It's not clear that splitting the court in two would be particularly helpful to Trump, or that this is something he's actually inclined to move ahead with.

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WH considers labeling North Korea a state sponsor of terrorism

Wong Maye-E / AP

A senior White House official said the U.S. is considering adding North Korea to the list of state sponsors of terrorism, per Reuters.

The club: North Korea would be joining Iran, Sudan, and Syria. It was de-listed as a state sponsor in 2008 after agreeing to scale back its nuclear program.

Context: Defense Secretary Mattis, Secretary of State Rex Tillerson, DNI Dan Coats, and Joint Chiefs Chairman Joesph Dunford are briefing Senators in at the White House today on North Korea.

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Al Gore says better than 50-50 chance Trump decides to stay in Paris climate accord

Emily Pidgeon/TED

Odds are that the U.S. will remain a party to the Paris climate accord former Vice President Al Gore said Wednesday In a brief appearance at the TED conference in Vancouver.

"I think there is a better than 50-50 chance the Trump administration will decide to stay in the Paris agreement," Gore said. "I don't know that for sure."

Gore said there is a debate taking place tomorrow inside the White House with a decision set to be announced the third week in May before a G-20 summit. "I think the odds are they will decide to stay in Paris agreement. I certainly hope so."

The backdrop: Gore's comments came during an entire session devoted to the impact on climate change. Discussions ranged from more accurate pictures of the crisis to weighing radical solutions, including shooting chalk into the atmosphere in order to reduce the amount of sunlight heating the earth. That idea drew criticism from Gore and others.

Featured

Trump has filled 5% of his senior administration jobs

Carolyn Kaster/AP

Of the 556 seats that have to be nominated by President Trump and confirmed by the Senate:

  1. 530 seats are empty
  2. 20 Cabinet-level seats filled, 2 await confirmation, 1 failed
  3. 37 nominees awaiting confirmation
  4. 468 seats have no nominations

The precedent: at the 100-day mark, Obama had 487 empty, George W. Bush 521, and Clinton 507

Featured

Trump tax plan leaves more questions than answers

Susan Walsh / AP

After Steve Mnuchin and Gary Cohn announced Trump's long-awaited tax reform plan today, Cowen and Company — a DC based consulting firm for investment banks — sent a document to Axios arguing that it left more questions than answers.

"What the Trump Administration has proposed is not permanent tax reform, but a ten-year tax cut and the creation of the most phenomenal fiscal cliff ever in 2028," read the company's statement.

Cowen pointed out some of the missing pieces from the plan, which they considered critical to understanding it:

  • Border Adjustment Tax (BAT) that would raise $1.1 trillion over 10 years.
  • Net Interest Deduction Elimination, raises $1.2 trillion over 10 years. "So without this or BAT, add $2.3T onto government credit card."
  • "President Trump's Personal Tax Returns. Democrats have said they will not even begin negotiating until his returns are made public."
Why 10 years? If the bill increases the deficit over the 10-year budget window — which it is almost certainly expected to considering the Trump admin hasn't put forth a clear way to pay for the plan — "the underlying section of the bill sunsets/expires after 10 years (just like the 2001 and 2003 Bush Tax Cuts that created the Fiscal Cliff in 2012)."
Featured

Trump plan would lower taxes on some hedge fund managers

AP Photo/Alex Brandon

President Trump campaigned on a pledge to increase taxes on hedge fund and private equity fund managers, by closing the carried interest loophole. But there is no mention of carried interest in the tax plan released today by the White House. Instead, there is a plan to lower the tax rate on so-called "pass through" entities, which actually would reduce the tax burden on many of those same professional investors.

What are pass-through entities? Businesses that pay taxes at individual rates (up to nearly 40%), rather than at corporate rates (35%).

New plan: The White House wants pass-through entities to be taxed at corporate rates, which it hopes to slash down to 15%.

Result: Trump's argument is that many small businesses currently are taxed as pass-through entities, but that treatment also applies to a lot of hedge funds and real estate funds that are structured as things like limited liability companies. Moreover, funds structured as limited partnerships (almost all private equity and venture capital) likely would either restructure or figure out a way to qualify as pass-through entities for tax purposes. In short, such fund managers would now pay a flat 15% tax on all of their income, including annual management fees on which they currently pay individual rates.

This would effectively eliminate the question over changing the tax treatment of carried interest, since 15% is lower than either the current capital gains rate or the ordinary income rate.

Possible caveat: Treasury Secretary Mnuchin said the following during a White House press briefing: "We will make sure that there are rules in place so that wealthy people can't create pass-throughs and use that as a mechanism to avoid paying the tax rate they should be on the personal side." He did not provide any additional specifics.

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House, White House considering Friday health care vote

Evan Vucci / AP

There is now discussion on the Hill and in the White House about a health care vote this Friday. The House whip team is busy counting moderate votes and gauging support within the caucus, and there should be a clearer picture of where things stand tonight.

A Friday health care vote isn't "outside the realm," Republican Study Committee Chairman Mark Walker told Axios, adding that people are discussing a Friday vote and things are "even trending that direction."

"Most of them like what they see, so we're considering to grow the vote, and when we're ready, we'll move," said House Majority Whip Steve Scalise.

Yes, but: Both the White House and GOP House leadership are cautious about setting artificial deadlines. That's what they did last time and it backfired. They believe a vote this week is possible, though they're unwilling to say "likely."

Featured Facts Matter

How tax plans have evolved with each presidency

J. Scott Applewhite, Charles Dharapak, Bill Frakes, Chris O'Meara / AP

The issue:

President Trump's tax reform plan was announced today. Treasury Secretary Steve Mnuchin said it'll be "the biggest tax cut and the largest tax reform in US history," and confirmed it will include a 15 percent corporate tax rate.

The facts:

  • Barack Obama: Obama called for a progressive tax system that would ensure an equitable level of taxation for every income bracket, with tax increases targeted at the rich.
  • George W. Bush: In 2001 and 2003, Bush ordered massive tax cuts, which reduced the top marginal tax rates and the average tax rate for nearly all taxpayers. His new tax rates ranged from 10 percent to 35 percent.
  • Bill Clinton: Clinton's plan raised taxes for 40 percent of Americans in order to lower the Federal budget deficit.

Why this matters:

Trump's plan largely focuses on lowering the corporate tax rate from the current 35% to 15% to help businesses better compete on a global level. Trump's administration insists that their plan will pay for itself by delivering increased economic growth, which in turn would generate higher tax revenues. Similar changes under Bush resulted in higher deficits.