Overnight Finance: Trump tears into Dems for skipping meeting | Court sides with Trump in consumer agency fight | Senate Budget panel approves tax bill | Fed nominee signals he’ll stay the course

Court sides with Trump in consumer agency fight: A federal judge on Tuesday rejected a lawsuit from an official who claims that she, and not President Trump appointee Mick Mulvaney, is the rightful director of the Consumer Financial Protection Bureau (CFPB).

Judge Timothy Kelly of the U.S. District Court of the District of Columbia declined to grant Leandra English a restraining order to bar Mulvaney from serving as the CFPB’s acting director.

The ruling clears the way for Mulvaney to run the CFPB until a permanent director is sworn in or English successfully appeals the decision.

{mosads}

Trump last week appointed Mulvaney to temporarily lead the CFPB until the lawmakers confirm his pick to replace Richard Cordray, who resigned as the agency’s director on Friday.

The president was able to appoint Mulvaney to the role because he was already confirmed by the Senate for another position — director of the Office of Management and Budget.

The legal dispute arose because Cordray, in one of his final acts at the agency, promoted English, his former chief of staff, to the role of deputy director, making her acting director under the CFPB’s rules of succession: http://bit.ly/2AdpnZv.

 

Ahead of the court decision, Mulvaney took steps to tighten his hold on the agency: White House budget chief Mick Mulvaney ramped up efforts to take over the helm of the Consumer Financial Protection Bureau (CFPB) on Tuesday amid a bitter fight for control of the agency.

Mulvaney again directed staff to disregard instructions from the agency’s deputy director, Leandra English, his second such memo telling employees to ignore communications from the top official.

“Consistent with my email from yesterday, please disregard any email sent by, or instructions you receive from, Ms. English when she is purporting to act as the Acting Director,” Mulvaney wrote in an email to CFPB staff on Tuesday, according to Reuters.

Mulvaney also sported a new Twitter account on Tuesday, using the handle @CFPBDirector. The only tweet from the account so far shows Mulvaney pouring over paperwork at the agency: http://bit.ly/2AgePsg.

 

Democrats pull out of White House meeting with Trump: Democratic leaders abruptly pulled out of a planned meeting at the White House with President Trump after he tweeted earlier Tuesday that he didn’t “see a deal” to avoid a government shutdown.

“Given that the President doesn’t see a deal between Democrats and the White House, we believe the best path forward is to continue negotiating with our Republican counterparts in Congress instead,” House Minority Leader Nancy Pelosi (D-Calif.) and Senate Minority Leader Charles Schumer (D-N.Y.) said in a joint statement.

“Rather than going to the White House for a show meeting that won’t result in an agreement, we’ve asked Leader [Mitch] McConnell [(R-Ky.)] and Speaker [Paul] Ryan [(R-Wis.)] to meet this afternoon. We don’t have any time to waste in addressing the issues that confront us, so we’re going to continue to negotiate with Republican leaders who may be interested in reaching a bipartisan agreement,” Pelosi and Schumer added.

Trump, Schumer and Pelosi were expected to meet Tuesday afternoon with Ryan and McConnell to discuss funding the government beyond next Friday, Dec. 8, when the current funding deal expires.

“Meeting with ‘Chuck and Nancy’ today about keeping government open and working,” Trump tweeted earlier Tuesday.

“Problem is they want illegal immigrants flooding into our Country unchecked, are weak on Crime and want to substantially RAISE Taxes. I don’t see a deal!” The Hill’s Cristina Marcos reports: http://bit.ly/2Afk0ZA.

 

That led to… Trump, next to empty chairs, tearing into Dems: President Trump tore into Democratic leaders on Tuesday for skipping a legislative strategy session at the White House.

Trump said he is “not surprised” that Senate Minority Leader Charles Schumer (D-N.Y.) and House Minority Leader Nancy Pelosi (D-Calif.) decided not to attend, accusing them of being “all talk” and “no action.”

“Now it’s even worse. Now it’s not even talk. Now they’re not even showing up to the meeting,” Trump said: http://bit.ly/2AeY9BF.

 

Schumer: ‘Great progress’ in funding talks before Trump tweet: Senate Minority Leader Charles Schumer (D-N.Y.) said negotiators were making progress in talks to prevent a government shutdown before President Trump weighed in on Tuesday morning.

“The staffs were making great progress until the president stepped in. We were very close on a number of issues,” Schumer told reporters.

Congress will need to pass either a stopgap bill or a long-term funding deal by Dec. 8 or the government will run out of money.

Schumer and Pelosi pulled out of the meeting, saying the “best path forward” was to keep negotiating with Republican leadership: http://bit.ly/2AgePsg.

 

Tax bill clears Senate Budget Committee: The Senate Budget Committee on Tuesday advanced the chamber’s GOP tax bill.

The measure was approved by a party-line vote of 12-11, with two key Republicans voting for the measure after previously expressing concerns.

The vote sends the measure to the Senate floor, where the bill could start to be considered as early as Wednesday. Overhauling the tax code is a top priority for Republicans and they are hoping to get legislation to President Trump’s desk by Christmas. 

Trump visited the Senate Republicans’ lunch just before the vote in an effort to rally lawmakers on the bill.

Monday evening, two GOP senators, Ron Johnson (Wis.) and Bob Corker (Tenn.), had left the door open to voting against the measure in committee if their concerns weren’t addressed before then. Johnson has expressed concerns that the bill doesn’t do enough to help pass-through businesses, while Corker is concerned about the impact on the debt.

However, they ultimately decided to vote in favor of the measure: http://bit.ly/2AfAC3q.

 

Happy Tuesday and welcome back to Overnight Finance. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

See something I missed? Let me know at slane@digital-staging.thehill.com or tweet me @SylvanLane. And if you like your newsletter, you can subscribe to it here: http://bit.ly/1NxxW2N.

 

Listen to The Hill’s new twice-daily podcast!

In today’s Hillcast PM View, the daily evening update on what went down in Washington: Democrats nix a scheduled White House meeting after a Trump tweet raised the specter of a shutdown; the GOP makes progress on some major tax obstacles; and a court prepares to rule on who really runs the Consumer Financial Protection Bureau. Host Niv Elis talks to The Hill’s Scott Wong, Naomi Jagoda, and Sylvan Lane about what happened today on Capitol Hill. Listen here.

And subscribe here to all of The Hill’s new podcasts: Apple Podcasts | Soundcloud | Stitcher | Google Play | TuneIn

 

Back to taxes… Trump pressed Johnson for vote: Two key holdouts on the Senate Budget Committee voted to advance the tax-reform bill after President Trump pressed them during a lunch meeting Tuesday.

“I think based on the progress we’ll go ahead and vote to move it forward,” Sen. Ron Johnson (R-Wis.) said shortly before the Budget Committee was scheduled to consider the legislation.

Trump called out Johnson by name twice during his meeting Tuesday afternoon with the entire Senate GOP conference and urged him to stop blocking the legislation.

“He told him to stop blocking it and to work out his concerns with the rest of the conference. He told him he would have a chance to offer amendments and he should stop being an impediment,” said a Senate GOP source familiar with the meeting. 

“He went at him twice by name,” the source added. http://bit.ly/2Ad1gtH.

 

Lawmakers, conservative groups don’t want ‘trigger’ in tax bill: Some GOP senators and outside conservative groups are raising concerns about the potential inclusion of a “trigger” in the Senate tax bill if the measure fails to meet economic growth projections.

GOP deficit hawks in the Senate have been pushing for a backstop that would scale back tax cuts if they add more to the deficit than Republicans expect. Sen. Bob Corker (R-Tenn.) said Tuesday that he has reached an agreement with leadership to include a trigger in the bill, though he did not provide any details about the provision.

But others are wary of automatic tax increases.

“Right now, my feeling about it is that I’d rather drink weed killer than vote for the thing,” Sen. John Kennedy (R-La.) told reporters, though he added that he’s willing to keep an open mind.

Sen. Rand Paul (R-Ky.) also said he’d prefer a trigger not be included.

“I’m not very excited about having any automatic raises in taxes,” he said. “I think if your economy is slowing down, that’s a terrible time to raise taxes.” http://bit.ly/2Blgt96

 

Fed nominee signals he’ll stay the course: President Trump’s nominee to head the Federal Reserve, Jerome Powell, on Tuesday indicated that he would bring a moderate approach to the central bank that would largely leave monetary policy on its present course.

Powell, a Republican Fed governor, testified before the Senate Banking Committee, which will vote whether to recommend his confirmation to lead the Fed. He was first nominated to the bank’s board in 2012 by President Obama, and as a member has voted in step with current Fed Chairwoman Janet Yellen. 

Republican lawmakers have expressed some concerns about Powell’s moderate stance on financial regulation, while some Democrats have called on him to back stricter rules for the financial sector.

Despite misgivings on the left and right, Powell appears to be on a smooth path to confirmation. I explain why here: http://bit.ly/2AfhSkQ.

 

Changes to Senate GOP tax plan may benefit Trump: President Trump may benefit from changes to the Senate GOP’s tax plan, The Washington Post reports.

A change being weighed by Republicans includes expanding a tax credit that lets certain entities decrease their taxable income. The change regards pass-through entities.

Pass-throughs are companies such as sole proprietorships and partnerships that are taxed through the individual code. Most U.S. businesses, including many small businesses, are pass-through entities.

Trump has investment stakes in about 500 entities that may be impacted by these potential changes, according to the report.
“You hold interests as the sole or principal owner in approximately 500 separate entities,” Morgan Lewis attorneys Sheri Dillon and William Nelson wrote in a letter released last year by the Trump campaign.

“Because you operate these businesses almost exclusively through sole proprietorships and/or closely held partnerships, your personal federal income tax returns are inordinately large and complex for an individual.” http://bit.ly/2AfSF9S.

 

High court wrestles with protections for whistleblowers: The Supreme Court appeared reluctant Tuesday to give Dodd-Frank protections to whistleblowers who report stock and investment fraud to their employers but not the federal government. 

Under the Dodd-Frank Act, the Securities and Exchange Commission (SEC) in 2011 issued new rules protecting employees from being retaliated against by their employers if they report fraud internally. 

Paul Somers, a former employee for Digital Realty Trust Inc., was fired after he reported alleged securities violations to his senior management. Somers never reported the information to the SEC, but his attorney says his employment should have been protected as a result of the 2011 rule. 

His former employer, a publicly traded real estate trust, disagrees. Digital Realty Trust argues that Dodd-Frank’s definition of a whistleblower explicitly excludes anyone who fails to report allegations to the SEC. 

Justice Neil Gorsuch, a self-described textualist who seeks to follow the literal reading of statutes, noted that Dodd-Frank explicitly states that the incentives and protections for whistleblowers “shall apply” to anyone who provides information relating to a violation of securities laws to the SEC.

“How much clearer could they have possibly been?” Gorsuch said, referring to the language lawmakers put in the legislation: http://bit.ly/2AgsmA6.

 

AT&T, Time Warner extend deadline to finalize merger: AT&T and Time Warner are extending the termination date of their merger to April 22, 2018, according to a Securities and Exchange Commission filing, now that the Department of Justice (DOJ) is suing to block their deal.

Despite the DOJ’s move to stop the merger, both companies are hopeful they’ll still be able to complete the $85 billion deal if they beat the agency’s lawsuit.
“AT&T intends to vigorously contest the DOJ’s allegations and is confident that the Court will reject the DOJ’s challenge to the merger,” the company wrote in its SEC filing.

Last week, in a surprising decision, the Justice Department moved to block AT&T’s proposed acquisition of Time Warner.

The merger would combine an entertainment powerhouse that includes HBO and CNN with a telecom giant. Such mergers across industries have generally been approved: http://bit.ly/2Agpsvc.

 

AT&T also hit back at the DOJ, insisting the merger was “pro-consumer”: AT&T is pushing back against the Department of Justice’s arguments against its proposed merger with Time Warner.

In its formal response to the DOJ on Tuesday, the company said that because the television industry had changed with the rise of platforms like Netflix and Hulu, the merger deal is actually “a procompetitive, pro-consumer response to an intensely competitive and rapidly changing video marketplace.” http://bit.ly/2zMBtcx

 

Cordray on CFPB fight: The law is on my side: The former director of the Consumer Financial Protection Bureau (CFPB) said in a Monday night interview that the law is on his side in a legal fight with President Trump over who will lead the agency until a permanent replacement is confirmed by the Senate.

On Friday, the day he resigned, Richard Cordray elevated his chief of staff, Leandra English, to deputy director of the CFPB. Hours later, Trump said Mick Mulvaney, the head of the Office of Management and Budget, was in charge.

“The law is clear here. It says that the director, that was me on Friday, shall appoint a deputy director. I did that,” Cordray said on MSNBC’s “The Rachel Maddow Show.” 

Cordray said the 2010 Dodd-Frank Act, which created the consumer protection agency, is unequivocal on this point.

“It then says very clearly and simply that if the deputy director is there is an absence, the deputy director becomes the acting director,” he said: http://bit.ly/2AdZdWv.

 

Community banks file lawsuit against Equifax: The Independent Community Bankers of America (ICBA) on Tuesday filed a lawsuit against Equifax demanding that the credit bureau be held accountable for a data breach of nearly 146 million consumer records.

The ICBA’s lawsuit, which was filed in the U.S. District Court for the Northern District of Georgia, asks Equifax to compensate all community banks harmed by the breach and to improve its security to avoid more damage.

“ICBA and the nation’s community banks are deeply troubled by the massive and preventable data breach at Equifax and its impact on community banks, consumers, small businesses and the economy,” said Camden Fine, ICBA president and CEO.

“Today’s lawsuit demands remedial action because Equifax needs to be held accountable for this massive and preventable catastrophic event,” Fine said. 

Bank of Zachary in Zachary, La., and First State Bank in Barboursville, W.Va., joined the suit with the ICBA: http://bit.ly/2AfC5Xn.

 

From The Hill’s opinion pages

Occupy CFPB: Mulvaney needs to rein in unruly agency, by Liz Peek

GOP tax plans ignore reality in creating good American jobs, by Karen Mills

Republicans may regret eliminating the state and local tax deduction, by John Vogel

 

Write us with tips, suggestions and news: slane@digital-staging.thehill.com, vneedham@digital-staging.thehill.com, njagoda@digital-staging.thehill.com and nelis@digital-staging.thehill.com. Follow us on Twitter: @SylvanLane,  @VickofTheHill, @NJagoda and @NivElis