- Congress scrambles to deal with Trump veto threatsÂ
- Brexit deal outline is reached
- Odds are little changed for Georgia Senate seat run-offs
Congress scrambles to deal with Trump veto threats — Congress is getting only a long weekend for the holidays after President Trump on Wednesday made good on his threat to veto the $741 billion National Defense Authorization Act. Mr. Trump has a number of complaints about the bill, but his key demand is that the bill repeal legal protections for social media companies. After his veto, President Trump left Washington to spend the holidays at Mar-a-Lago.
Congress intends to return to Washington early next week in order to approve the Defense Act with veto-proof majorities since the bill has strong bipartisan support. However, if Congress cannot approve the bill with veto-proof majorities, then the bill will die on January 3 when the current session of Congress ends. The new Congress would then have to take up the defense bill from scratch.
The National Defense Authorization Act authorizes non-discretionary defense spending for measures such as guaranteeing soldier pay raises, retention of recruitment bonuses, and defense modernization and construction programs, according to the Washington Examiner. Those programs will halt if the Act does not receive final approval.
Congress is also dealing with the uncertainty caused by President Trump’s threat to veto the pandemic aid and omnibus spending bill that Congress passed on Monday night. Mr. Trump is demanding that the stimulus checks be raised to $2,000 from $600.
Mr. Trump’s demand for $2,000 stimulus checks is causing heartburn for Republicans, who do not support spending the extra money. By contrast, Speaker Pelosi said she would be delighted to approve that measure, and she plans to try to force through a unanimous consent today to approve a standalone bill to raise the stimulus check size to $2000.
However, House members have already left Washington, and it would take only one House member to block the vote. Bloomberg reported that House Minority Leader McCarthy told Republicans that Ms. Pelosi’s effort to pass a bill raising the stimulus check to $2000 would fail. In the Senate, Majority Leader McConnell would almost certainly oppose raising the cost of the $900 billion pandemic aid bill, which is already higher than his initial limit of $500 billion.
The question is whether Mr. Trump is bluffing or whether he will go through with vetoing the pandemic aid and omnibus spending bill. In reality, Mr. Trump does not even have to veto the bill for the bill to die. Mr. Trump has 10 days from the bill’s presentation (which hasn’t occurred yet) to decide whether to sign the bill. By contrast, if he doesn’t sign it, then it will go down in flames through a so-called pocket veto whereby the bill would die at the end of the legislative session on January 3.
If Mr. Trump were to take the pocket-veto route, then the bill will definitely die because Congress could not even try to get veto-proof majorities. If Mr. Trump vetoes the bill, then there is a chance that Congress might be able to muster veto-proof majorities to approve the bill, although that seems unlikely if Mr. Trump actively pressures Republicans to oppose the bill.
The bottom line is that the fate of the pandemic aid and spending bill is completely in Mr. Trump’s hands. If he wants the pandemic aid and spending bill to go down, it will.
If the pandemic aid and omnibus spending bill goes down, then there would be a government shutdown this coming Tuesday since the 7-day continuing resolution expires on Monday. To prevent that, Congress by Monday would have to pass another short-term CR to bridge the gap to the eventual passage of the omnibus spending bill, which might have to wait for President-Elect Biden to arrive on January 20.
The U.S. stock market on Wednesday did not seem to be very worried that the $900 billion pandemic aid bill might go down in flames. The markets seem to be betting that Republican leaders will get Mr. Trump to back down on his demand for larger stimulus checks since his demand is politically negative for Republicans and is hurting Republican chances of winning the two Georgia Senate seat elections on January 5.
Brexit deal outline is reached — The markets were relieved by reports Wednesday that the outline of a Brexit deal had been reached and that the negotiating teams were finalizing the wording of the document. However, the deal still has to be approved by Prime Minister Johnson and EU governments, meaning there is still time for something to go wrong. The two sides are hoping to make a final announcement on Thursday that a deal has been reached. GBP/USD on Wednesday rallied by +0.99%.
Odds are little changed for Georgia Senate seat run-offs — The polls and betting odds are little changed for the upcoming run-off elections for the two Georgia Senate seats that will take place on January 5. If Democrats win both those seats, they will take control of the Senate and will be able to approve at least parts of the blue-wave agenda depending on the status of the Senate filibuster rule.
FiveThirtyEight reports that the Republican Perdue is slightly ahead of Democrat Ossoff in the polls at 48.8%-48.4%. In the other race, Democrat Warnock is slightly ahead of Republican Loeffler by 48.8%-48.3%. The betting odds at PredictIt.org, for whatever they are worth, are at 73% for Republican control of the Senate after the Georgia run-off elections and 30% for Democratic control. Early voting in Georgia began last week, and turnout is at a record high.
