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🇺🇸 Coming Down to the Wire

🇺🇸 Coming Down to the Wire

Plus, more than one-quarter of homeowners in the US are “house poor.”

May 31, 2023

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Good morning, and happy Wednesday. More than 50 years after graduating high school, a 72-year-old recently earned an undergraduate degree and turned his tassel.

Plus, More than one-quarter of homeowners in the United States are “house poor.” Here’s what that means.

Also, for all of the business, finance, and market folks in our audience, did you see Nvidia just became the ninth company to join the $1 trillion market cap club? Pretty incredible stuff. If you’re actively trading or simply looking to learn more be sure to check out CenterPoint by Clear Street. Right now they’re offering free commissions for 60 days.

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Drones Hit Moscow, Holmes Heads to Prison, Extinction from AI

World: Drones hit Moscow, shocking Russian capital after new missile attack on Kyiv (WaPo)

US: Elizabeth Holmes enters Texas prison to begin 11-year sentence for notorious blood-testing hoax (AP)

US: Former first lady Rosalynn Carter has dementia, Carter Center says (CNN Politics)

US: Trump pledges to end birthright citizenship on first day in office (The Hill)

Tech: AI experts sign doc comparing risk of ‘extinction from AI’ to pandemics, nuclear war (Cointelegraph)

Economy: Home price declines may be over, S&P Case-Shiller says (CNBC)

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What Happens in Washington Does Not Stay in Washington

What happens in Washington impacts what happens on Wall Street. This, in turn, impacts your wallet. Look no further than this debt ceiling debacle. That's one of the themes we see constantly while writing this newsletter.

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FISCAL POLICY

Down to the Wire

Today we’re taking another look at how both sides are reacting to the latest regarding the debt ceiling agreement. Here’s a taste of some general news coverage:

Reporting from The Right: Freedom Caucus members call on McCarthy to scrap debt ceiling agreement with Biden: ‘Bad deal’ Patrick Hauf, Fox News

Reporting from The Left: Republican tries to scuttle debt limit bill in House Rules Committee as pressure grows on key swing vote Manu Raju, CNN

From the Flag: Lawmakers are rushing to pass the bill through both chambers in order to avert a default ahead of the expected June 5 deadline. Here’s more from both sides.

RIGHT-LEANING SENTIMENT

It’s Not Perfect, But This is a Win for the GOP

The debt ceiling had to be raised anyway so this ended up being a pretty nice win for the GOP.
It’s just the first step. Much more needs to be done, but far-right Republicans would be crazy to vote against it.
If you want a better deal on the budget, win more elections.

A Debt-Ceiling Deal Worth Passing Editorial Board, Wall Street Journal: "The deal is a significant victory for GOP priorities, in return for raising the debt ceiling that had to be raised anyway. ... Republicans who say the national debt will keep rising should blame Donald Trump, who joined Mr. Biden in attacking entitlement reform. Mr. McCarthy won the showdown with Mr. Biden over domestic discretionary spending by picking politically popular ground to fight on and then rounding up 218 votes to give his negotiators leverage. Assuming the deal passes Congress, it will defy the Democratic narrative that Republicans can’t govern. Mr. McCarthy’s troops are proving they can, and conservatives would be foolish to abandon the victories in this deal.”

Republicans win on the debt ceiling: Here's why House GOP should support deal Newt Gingrich, Fox News: "The agreement reached Saturday night between Speaker Kevin McCarthy and President Joe Biden is an historic first step toward shifting government back toward common sense and conservatism. It is a step toward creating a smaller government, lower taxes, less regulation, economic growth, prosperity, and more take home pay. All of this will also strengthen Social Security and Medicare. ... When you hear complaints from some on the right, remember they are arguing from a mythical belief. Somehow, they think defeating this agreement would improve things. They could hardly be more wrong. ... Every House Republican now faces a simple choice: Help take the first step and move on to even bigger steps – or fight about it and hand the initiative over to President Biden and the Democrats. The choice is simple. They can support a more conservative future – or prove Republicans can’t govern even when they are winning."

One more opinion piece from the Right: Budget Deal Clears a Very Low Bar, National Review

LEFT-LEANING SENTIMENT

The Deal Stinks, But We Have to Pass It

The details of the agreement show it is a watered-down version of the Republican wish list. Nevertheless, Congress should pass this agreement as quickly as possible.
Want to fix it? Win in 2024.
The “MAGA crazies” in the House might not let this agreement pass, which would be catastrophic.

Pass the Debt Limit Deal. Then Figure Out How to End the Drama. Editorial Board, New York Times: "The final agreement reflects ... one-sided bargaining, with Mr. McCarthy refusing to truly entertain any of the Democrats’ proposals to raise revenue: None of the 2017 Trump tax cuts, which added $1.8 trillion to the deficit through 2029 for the benefit of corporations and the wealthy, will be rolled back. Republicans rejected the elimination of the carried-interest loophole, which benefits hedge-fund managers and private equity funds, and the end to fossil fuel tax subsidies that Mr. Biden proposed in his 2024 budget. ... One of the most nonsensical Republican demands was to cut $80 billion in new funding for the Internal Revenue Service to hire investigators to reduce tax cheating. The I.R.S. expansion would have reduced the budget deficit, according to the Congressional Budget Office, because it would bring in new tax revenue. ... Yet with the risk of ruinous economic default less than a week away, Congress should pass this agreement as quickly as possible.

Democrats unhappy with the deal to raise the debt ceiling have an easy way to fix it Dean Obeidallah, CNN Opinion: "... To all my fellow Democrats unhappy with this compromise, there is an easy fix: Win back control of the House in 2024 — while retaining the Senate and White House — and they can roll back any parts of the deal they find objectionable. ... Of course, Democrats could win back the House — plus retain the White House and Senate — and still not everything most of them support will become law. We saw that scenario play out in 2022 when Democratic Sen. Joe Manchin of West Virginia blocked Biden’s sweeping Build Back Better proposal to expand the social safety net. However, winning elections is the best way to effectuate change — including rolling back any compromises in this deal that the Democratic base doesn’t support. And the best part is that the 2024 election is only a little over a year away."

One more opinion piece from the Left: The Debt-Ceiling Deal Isn't Perfect, But It Must Pass Robert Reich, The Guardian

FLAG THIS

Most Actually Don’t Care About a Shutdown

According to the most recent survey conducted by Rasmussen Reports, 38% of likely US voters prefer Congress authorizing government spending at a higher level in order to prevent a partial government shutdown.

Here’s an interesting nugget: a majority doesn’t care about a shutdown. In fact, 54% would opt for a partial government shutdown until Democrats and Republicans reach an agreement to either reduce spending or maintain it at its current level.

Would you rather:

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Keeping It Clean, RYSE & Shine, Manage Your Own Money

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Tulsa Massacre, Next Gen American Cheese, Expand Your Vocabulary

Tulsa aftermath. Jun 1, 1921

Beginning on the night of May 31, 1921, thousands of white citizens in Tulsa, Oklahoma descended on the city’s predominantly Black Greenwood District, burning homes and businesses to the ground and killing hundreds of people. Long mischaracterized as a race riot rather than mass murder, the Tulsa Race Massacre stands as one of the worst incidents of racial violence in the nation’s history.

The Walrus: As a Therapist, I Know What’s Breaking Couples Up

Eater: The Next Generation of American Cheese

Mental Floss: 56 Delightfully Unusual Words for Everyday Things

Today I Learned a family in Georgia descended from slaves passed down a song in their native language for generations. Scientists identified the song as a genuine West African funeral song in the Mende language. It survived multiple transmissions from mother to daughter over multiple centuries.

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