US Senate Takes Major Step to Sweeping Tax Reform
Late Wednesday, the US Senate took a step toward passage of tax legislation setting up a likely decisive vote later this week.
Republicans spent the day working on the bill, which aims to cut taxes on corporations, other businesses and many individuals and families, to satisfy lawmakers worried about how much it would expand the US budget deficit.
The DJIA and Russell 2000 (small caps) rallied to fresh record highs on optimism it will pass.
The Dow Jones Industrial Average (+0.4%) and the Russell 2000 (+0.4%) finishing at +103.97 or 23940.68 and +5.86, or 1,542.30 respectively.
obstacles remained, including attempts to address the estimated $1.4-T that the bill could add to the United States’ national debt over 10 years.
Lawmakers voted 52-48 to begin formal debate, a step that could lead Thursday and Friday to a full vote on the bill.
Congressional Republicans are eager to pass the legislation showing their control of the White House and both houses of Congress.
Republicans have a 52-48 majority in the 100-member Senate, giving them enough votes to approve the bill as they hold together. Without Democratic support, Republicans can afford to lose no more than 2 of their own votes. The Vice President is the tie-breaker vote.
President Donald Trump in a speech in St. Charles, Missouri Wednesday, told members of his party to get behind the effort, a very significant legislative achievement.
“A vote to cut taxes is a vote to put America 1st again,” President Trump said, adding the bill could “cost me a fortune” and that his wealthy friends were not happy. “My accountants are going crazy right now. It’s all right. Hey look, I am president, I don’t care. I don’t care anymore.”
Democrats say the tax cuts are a giveaway to corporations and the wealthy at the expense of working Americans.
Democrats and Independents were trying to persuade nonpartisan Senate officials to disqualify parts of the bill, including 1 to allow drilling in the Arctic National Wildlife Refuge, as impermissible under Senate rules, an aide said.
Shayne and I expect the tax reform bill will be reconciled in Congress and be on the President’s desk for signature before Christmas.