Overnight Finance: Trump says he won’t back down on tariffs | GOP pressure to pull back grows | Trading partners promise payback | Dems divided over bank rules | Cochran to resign next month
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THE BIG DEAL: President Trump isn’t budging on his proposed tariffs on steel and aluminum despite protests from his own party and promises of retribution from trading partners.
“No, we’re not backing down,” Trump told reporters at the White House, saying the U.S. “has been ripped off by virtually every country in the world, whether it’s friend or enemy,” on trade.
Trump’s plan to impose tariffs of 25 percent on steel and 10 percent on aluminum, abruptly announced Thursday, sent shockwaves through U.S. politics and financial markets. The president’s staunchest congressional allies opposed the plan from the jump and spent the weekend pushing him away from the tariffs.
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Crucial trading partners and allies said they’d impose tariffs of their own on U.S. imports, and U.K. Prime Minister Theresa May brought up her concerns with Trump’s plan in a Sunday phone call.
None of that seemed to move Trump. He insisted that the tariffs wouldn’t start a trade war, despite the World Trade Organization’s warnings that they could.
Trump’s comments triggered another round of condemnation from GOP leaders, including House Speaker Paul Ryan (R-Wis.).
“We are extremely worried about the consequences of a trade war and are urging the White House to not advance with this plan,” Ryan spokeswoman AshLee Strong said in a statement on Monday. “The new tax reform law has boosted the economy and we certainly don’t want to jeopardize those gains.”
Ryan’s office said that the Speaker has shared his concerns personally with the president “on multiple occasions,” including last week. The speaker also tweeted a photo of himself meeting Monday with European ambassadors “to discuss economic cooperation,” a notable difference in approach from Trump’s zero-sum analysis.
Reactions
- “The administration and Congress must work together on trade policies that build off the momentum of the president’s tax cuts.” — A spokeswoman for the House Ways and Means Committee.
- “The idea of imposing steel or aluminum tariffs of any kind is an affront to economic freedom.” — David McIntosh, president of the conservative political group Club for Growth.
- “Trade wars are not won, only lost.” — Sen. Jeff Flake (R-Ariz.)
- “I think they should have been well-aware. This is, again, something the president hasn’t been shy about.” — White House press secretary Sarah Huckabee Sanders.
The aftermath
- White House trade adviser Peter Navarro on Monday dismissed concerns that the tariffs will lead to a spike in inflation or larger economic issues.
- South Korean officials plan to address concerns over trade frictions at this month’s Group of 20 meeting.
- Secretary of Commerce Wilbur Ross conceded that there may be some retaliation over the Trump administration’s decision to impose tariffs on steel and aluminum imports, but argued any retribution would be “trivial.”
- An organization representing German automakers is warning against President Trump’s threat to impose tariffs on car imports.
What comes next: A hell of a lot more fighting until Trump signs something into law. We still don’t have a date for that yet.
ON TAP FOR TOMORROW
- Senate votes to begin debate on the bill (S. 2155) from Sen. Mike Crapo (R-Idaho) to ease Dodd-Frank banking rules
- Senate Finance Committee: Hearing on protecting consumers from counterfeit products sold online, 10 a.m.
- House Appropriations Committee: Hearing on the fiscal 2019 budget request for the Treasury Department, with Treasury Secretary Steven Mnuchin, 10 a.m.
- House Financial Services Committee: Markup of fiscal 2019 budget views, 10 a.m.
LEADING THE DAY
The last, best chance to roll back Dodd-Frank: Democrats are set for a serious fight over banking regulations this week as Republicans bring a bill to the floor that liberals say is a significant rollback of the Wall Street reform bill signed into law by President Obama.
The battle pits moderate Democrats up for reelection this year in states like Missouri, West Virginia, North Dakota and Montana against Sen. Elizabeth Warren (D-Mass.) and other progressives, and comes as the party braces for primary fights between the left and center.
The bipartisan measure to roll back critical parts of the Dodd-Frank Act is expected to pass the Senate within days, with the first procedural vote scheduled for Tuesday.
Moderate Democrats and Republicans who support the bill call it a long-overdue step to free community banks and credit unions from unnecessary regulations.
Liberal critics of the legislation, including some Democrats seen as potential White House candidates in 2020, say it uses small institutions as cover for loosening rules on major banks, putting the entire economy at risk.
Check out The Hill’s Tuesday paper or come back to TheHill.com tomorrow morning for the full story. Find out where the Senate left things last week with a brief recap here.
Major Senate retirement: Sen. Thad Cochran (R-Miss.) on Monday announced he will resign from the Senate next month, saying his “health has become an ongoing challenge.”
“I intend to fulfill my responsibilities and commitments to the people of Mississippi and the Senate through the completion of the 2018 appropriations cycle, after which I will formally retire from the U.S. Senate,” Cochran said in a statement.
He is set to resign from his seat on April 1, according to his office. The Hill’s Jordain Carney keeps us updated on the developing news.
Anti-gun activists turn focus on Wall Street: Activists on the left are opening a new front in their campaign to undercut gun manufacturers, this time putting pressure on financial companies and pension funds.
Progressives have already seen great success pressuring retailers to limit gun sales, with a slew of chains in recent days pledging that they will not sell certain rifles to people under the age of 21.
Now activists are hoping to deal a bigger blow to gun manufacturers by getting the financial world to turn against them. But the effort could be a heavy lift, with no signs that investment houses will bow to the pressure.
“There are a lot of people talking about it but there aren’t many people taking immediate action,” said one K Street veteran representing financial services companies. “There are very few companies that will make decisions based on the current climate.” I’ll tell you about it here.
MARKET CHECK: Rebounding. After a jumpy start this morning due partly to concerns about a looming trade war, U.S stocks closed with strong gains. The Dow Jones industrial index closed 336 points higher, a 1.3 percent gain. The Nasdaq and S&P 500 also closed with 1 percent gains each.
GOOD TO KNOW
- Fed vice chair of supervision Randal Quarles says the Fed is planning ‘material changes’ to the Volcker Rule, reports Reuters.
- Democrats are raising questions about restrictions from the IRS on people prepaying their property taxes, accusing the agency of targeting blue-state taxpayers.
- The federal government is set to auction an estimated $25 million in bitcoins that were seized in criminal activities, Bloomberg reported Monday.
- U.S. chipmaker Qualcomm is delaying a major shareholder meeting this week so federal regulators can review whether a hostile takeover bid from foreign technology giant Broadcom poses a national security threat.
- The New York Times digs into what foreign banks get, and don’t get, from the Senate bill to rollback Dodd-Frank.
ODDS AND ENDS
- Amazon is exploring the creation of a checking account-style product to offer its customers, The Wall Street Journal reported Monday.
- A federal judge has ordered former drug company CEO Martin Shkreli to forfeit $7.36 million in assets, Reuters reported Monday.
- City A.M., a paper covering finance for London’s financial sector, wins the award for best punny headline about tariffs.
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