Bill Owens: This Week's Confounding And Confusing Events 1/29/19

Jan 29, 2019

POTUS in response to the Speaker’s letter delaying the State of the Union, sent a letter to the Speaker canceling her trip to Europe, although he does offer her the opportunity to fly commercial.  Secretary Pompeo and his wife traveled throughout the Middle East on government aircraft, and at great expense, yet a trip to Afghanistan by the Speaker was denied.  Aw, the games we play.

As the shutdown drags on, we are seeing members of the public saying thank you to unpaid federal workers, contributing to groups that are providing support to those workers, and a large outcry of people asking the “why” question. 

Last week, Microsoft announced Five Hundred Million Dollars will be invested to help create affordable housing in Seattle.  Will Amazon do the same in Seattle, New York and Washington, the latter two cities are the location of its two new headquarters?  Will we see more of this as government retrenches from providing a social safety net by other big corporations?

Mr. Cohen will testify that the President ordered him to pay a vendor to manipulate poll results leading up to the 2016 campaign.  In another story buzz-feed claims that the President instructed Mr. Cohen to lie to Congress; Mr. Mueller denies the accuracy of the buzz-feed report that in a somewhat opaque way. Mr. Cohen announced on January 23, 2019 that his Congressional testimony is indefinitely postponed.  Wonder what this means? 

Prime Minister May of England barely survives a no-confidence vote.  On January 21st, she submitted Plan B which according to reports and Mr. Corbyn, the British labor leader, not much has changed.  How does she expect to get Plan B through the House of Commons given her overwhelming defeat earlier this month?

One-hundred and thirty House Republicans joined with Democrats in an attempt to override the President’s decision on Russian sanctions, the Senate cannot muster the votes.  Is this the beginning of a trend?

On January 22nd, the stock market began a downward slide in its ongoing rollercoaster ride as the US cancelled the trade meeting with the Chinese.  Very few experts believe a deal can be done by March 31st, and question whether China really intends to enter into substantive structural changes to its economy.  I ask the question again.  Is this really going to lead to more manufacturing jobs in the US?  Remember, that was POTUS’ promise.  Fix the trade agreements and increase manufacturing jobs, a relatively simple syllogism, but can it be achieved? 

The weekend of January 19th and 20th, saw some interesting commentary from Senator Langford and Chairman Thompson of the House Homeland Security Committee.  Mr. Thompson indicated that there were places where a wall might be appropriate, but in other locations, different methods of securing the border would be appropriate.  Mr. Langford indicated that Mr. Trump’s offer on Saturday the 19th, was a strawman, simply inviting negotiations.  This may be the first look at serious information about where this shutdown is going.  The Senate will vote on a Republican proposal and a Democratic one.  Neither is likely to pass.  None the less, I suspect we are close to a solution as the President nears the time for State of the Union and his job numbers plummet.    

I came back through the northern border recently and thanked the officer in the booth who cynically remarked, “it’s really cold (it was below zero at that point) and I am getting to do this for free”.  Hopefully, ultimately, he was not doing it for free, and the legislation signed into law by the President last week will, in fact, take effect, with all back pay being restored.  I would also take note of the fact that few of the cabinet members or members of the President’s Council of Economic Advisors are not making much commentary about the shutdown the last several days.  Clearly, some of the commentary they made previously was, at best, embarrassing, and maybe silence indicates that there are real conversations going on behind the scenes.  Let’s hope so.

China’s economy is weakening, but everything is relative as China’s growth for 2018 was still over 6% which is essentially double the US and most western European countries.  For 2019, China predicts 6.4% growth while the US is at 2.3% and the World Bank projects 3.5% for the Global Economy.

And next week will bring?

Mr. Owens is a former member of Congress representing the New York 21st, a partner in Stafford Owens in Plattsburgh, NY and a Senior Advisor to Dentons to Washington, DC.

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