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Yellen says US is projected to hit debt ceiling on Jan. 19

Treasury Secretary Janet Yellen said the U.S. is projected to reach its roughly $31.4 trillion borrowing limit in less than a week.

An estimate from the Peter G. Peterson Foundation shows the nation’s debt climbing above $31 trillion and within striking range of the limit set more than a year ago.

Yellen shared the estimate in a letter to Speaker Kevin McCarthy (R-Calif.) on Friday. She also warned the department would soon have to begin taking “extraordinary measures” to stave off a default to buy time for Congress to find a bipartisan solution.

Those measures include temporarily redeeming existing and suspending new investments of the Civil Service, Retirement and Disability Fund and the Postal Service Retiree Health Benefits Fund, as well as suspending reinvestment of the Government Securities Investment Fund of the Federal Employees Retirement System Thrift Savings Plan.

Yellen added that the funds would be “made whole” after the debt limit impasse has ended. 

While the secretary said it’s unlikely cash and extraordinary measures will run out before early June, she stressed the measures will only last for “a limited amount of time” and pressed for Congress to “act in a timely manner” to raise or suspend the ceiling.

The letter to McCarthy comes as a high-stakes fight over raising the debt ceiling looms over the further Congress after Republicans took back control of the lower chamber last week.

McCarthy has pressed for any action to address the debt ceiling to be tied to spending cuts sought by Republicans. However, proposals for significant cuts are likely to find trouble in the Senate, where Democrats still hold control.

“If you’re going to ask for an increase in the limit, at some point in time, you’ve got to sit down and say why are we hitting the limit? Why are we maxing out the credit card?” House Majority Leader Steve Scalise (R-La.) told reporters earlier this week.

Source: TEST FEED1

GOP officially launches probe into chaotic Afghanistan withdrawal

A top House Republican has officially launched a probe into the Biden administration’s chaotic withdrawal from Afghanistan in August 2021, sending a letter to Secretary of State Antony Blinken requesting a wide array of information on the matter.

Rep. Michael McCaul (R-Texas), the chairman of the House Foreign Affairs Committee who served as its ranking member previously, said the Biden administration has so far refused to hand over documents but that he is now formally requesting compliance as chair of the panel.

“It is absurd and disgraceful that the Biden administration has repeatedly denied our longstanding oversight requests and continues to withhold information related to the withdrawal,” McCaul said in a statement. “In the event of continued noncompliance, the Committee will use the authorities available to it to enforce these requests as necessary, including through a compulsory process.”

McCaul is seeking intelligence assessments, internal agency documents and communications with the Taliban and Afghan government, among a long list of other inquiries in the letter Thursday.

He requested the information from the Biden administration by Jan. 26.

The Hill has reached out to the State Department for comment.

Republicans have long hinted at the Afghanistan investigation, one of a number of probes the party planned to launch after seizing the House in the November midterm elections.

In October, McCaul demanded the State Department preserve records related to the U.S. troop pullout from Afghanistan, promising he would investigate messy evacuations, the quick Taliban takeover of Kabul and the death of 13 American troops in a terrorist attack.

The chaos surrounding the Afghanistan withdrawal was the focus of bipartisan scrutiny in 2021 as the U.S. exit was highly publicized, with photos and videos showing refugees scrambling to leave the country.

Last year, Republicans on the Foreign Affairs Committee released a report as minority members of the panel slamming the White House for sloppy planning, understaffing at Afghanistan’s largest airport and failing to anticipate the wave of refugees.

The White House responded that the report was “riddled” with inaccuracies.

Republicans are also expected to issue subpoenas to compel U.S. officials to sit for depositions in the probe led by McCaul.

McCaul on Thursday said he takes the obligation of investigating the withdrawal “very seriously” and will “pursue this investigation until all our questions are answered and all parties responsible are held accountable.”

“We owe this to the American people, especially our service members and veterans,” the lawmaker said in his statement.

Source: TEST FEED1

Why Tesla is dropping prices across the US

Tesla is slashing prices amid slowing demand for cars and the introduction of new electric vehicle tax credits that come with strict price caps. 

The EV giant cut the price of some of its vehicles by up to 20 percent. Tesla dropped the price of its base Model 3 car by $3,000 and slashed the price of the performance model by $9,000. The more expensive Model Y saw its price drop by roughly $13,000.  

The cost of Teslas and most EVs skyrocketed throughout the pandemic as supply chain snags made it difficult for automakers to produce enough vehicles to meet demand. 

But consumers are slowing down their spending, and most Americans can no longer afford EVs, which reached an average price of $66,000 last year, according to Kelley Blue Book. 

Dan Ives, an analyst at Wedbush, said that Tesla’s price drop is aimed at boosting demand and taking even more market share from its competitors, which have slowly been catching up to Tesla.

“This is a clear shot across the bow at European automakers and US stalwarts (GM and Ford) that Tesla is not going to play nice in the sandbox with an EV price war now underway,” Ives said.

Tesla’s price drops are timed around the rollout of new EV tax credits.

The cuts will allow Tesla’s Model Y and Model 3 Performance vehicles to qualify for the EV tax credit, which only applies to cars that cost less than $55,000. 

Consumers will be able to claim a $7,500 tax credit if they purchase their Tesla before March, when the federal government will implement requirements around EV component sourcing that will cut the tax credit in half for Tesla vehicles.

Tesla’s price cuts also come after the automaker fell short of its delivery goal in the fourth quarter of 2022.

Tesla raised its prices several times in recent years amid huge demand and a limited supply of vehicles stemming from the shortage of semiconductors.

Over the summer, Tesla CEO Elon Musk expressed concern that prices were becoming “embarrassingly high” and could price customers out of the market.

“You can’t kind of just raise prices to some arbitrarily high level because you pass the affordability boundary and then the demand falls off a cliff,” Musk said on an earnings call in July. 

Cars are finally becoming cheaper after multiple years of soaring prices. The price of new vehicles fell 0.1 percent in December, while used car prices slipped 2.5 percent, according to Labor Department data released Thursday. 

Source: TEST FEED1

House GOP flocks to cable news as new majority takes center stage

More and more House Republicans are showing up on cable news as the party settles into its majority in the chamber.  

The trend was on full display during the dramatic race for the House Speakership, when dozens of GOP lawmakers flocked to the cable airwaves to discuss now-Speaker Kevin McCarthy’s (R-Calif.) battle for the gavel.  

A recent internal count shared with The Hill found that more than 50 GOP lawmakers appeared on CNN alone last week.  

Some are relative newcomers to the cable news circuit, while others have appeared regularly on various shows across a number of networks.  

Here are a few House GOP members who cable news viewers might see more of in the coming months.

Rep. Warren Davidson (R-Ohio)  

Rep. Warren Davidson (R-Ohio) has frequently appeared on cable news shows in recent weeks to discuss the Speaker’s race and the controversy surrounding Rep. George Santos (R-N.Y.). (Greg Nash)

Davidson, 52, is a former special operations officer in the U.S. Army who was first elected in 2016 to fill former House Speaker John Boehner’s seat.  

He’s appeared frequently on cable news to discuss the Speaker’s race and the controversy surrounding newly elected Rep. George Santos (R-N.Y.).  

During his appearances, Davidson has offered some candid thoughts, telling CNN’s Wolf Blitzer that the embattled Santos, who is facing calls to resign for lying about his resume and personal biography, “hasn’t earned my trust.”

Davidson nominated McCarthy for the Speakership during the election’s fifth of 15 votes and has separately gone on the record criticizing Ukrainian President Volodymyr Zelensky for making an address to a joint meeting of Congress, last month.

During another CNN interview, Davidson said he was not sure McCarthy could get to 218 votes for Speaker. Davidson was right; McCarthy ultimately won 216 votes for Speaker, with other GOP lawmakers voting present.  

Rep. Dusty Johnson (R-S.D.)  

Rep. Dusty Johnson (R-S.D.) is seen before Greek Prime Minister Kyriakos Mitsotakis gives an address to a joint session of Congress on Tuesday, May 17, 2022. (Greg Nash)

Johnson, who came to Congress in 2019 after winning South Dakota’s lone spot in the lower chamber, has not been a regular on cable news until recently.  

He appeared on CNN’s new morning show this week to caution against his party’s leadership kicking Democrats off committees now that they have claimed the majority, but argued that Democrats had set precedent for political vengeance.  

“I said when Nancy Pelosi started kicking Republicans off committees that this was going to go to a bad spot,” Johnson said, referring to Rep. Pelosi, the former Democratic Speaker from California.  

“I don’t think that the Speaker should just be kicking the opposition off of committees just willy nilly. But this is the new normal. This is what Nancy Pelosi has created. I think it is very difficult in this environment for Republicans to unilaterally disarm,” he said.    

Johnson, 46, has separately made headlines this week with the introduction of the GOP’s proposed “Keep the Nine” Bill, which would limit the number of justices on the U.S. Supreme Court amid calls from some liberals to expand the high court.  

Rep. Byron Donalds (R-Fla.)

Rep. Byron Donalds (R-Fla.) speaks with Reps. Chip Roy (R-Texas) and Scott Perry (R-Pa.) during the fifth ballot for Speaker on the second day of the 118th session of Congress. (Greg Nash)

Donalds, 44, has been a darling of the Republican base and conservative media ecosystem since bursting onto the political scene two years ago.  

Several of the McCarthy holdouts nominated Donalds for the Speakership during the series of votes, some of whom urged Republicans to make history by electing the first Black Speaker of the House.  

Democrats, who find themselves in the minority following last fall’s midterm elections, nominated Rep. Hakeem Jeffries (D-N.Y.), for the Speakership before each of the 15 votes.  

Donalds this week made a widely buzzed-about prime-time appearance on Joy Reid’s MSNBC talk show, sparring with the host during an interview that at times grew hostile.  

“The reality is that a lot of members actually do believe in my ability to lead,” Donalds told Reid. “They do. Am I to be despised for my youth because I served one term? My members know I have the ability to engage other members through the conference, but it’s even bigger than that.”

The interview received heavy coverage this week, particularly among right-leaning news websites, which praised Donalds for how he handled Reid’s line of questioning.  

Rep. Nancy Mace (R-S.C.)  

Rep. Nancy Mace (R-S.C.) discusses the House Rules package after a closed-door House Republican conference meeting on Tuesday, January 10, 2023. (Greg Nash)

Mace, 45, is not a newcomer to cable news, but she has positioned herself as a go-to source for networks to turn to for analysis and insight on the internal dynamics of her party and congressional politics writ large.  

The South Carolina legislator appeared several times on a number of networks during the Speaker’s race and this week made an early-morning appearance on CNN to talk about the Federal Aviation Administration (FAA) computer meltdown that grounded flights across the country for several hours on Wednesday.  

“We will have to bring in the head of the FAA and others to explain to Congress and the American people what happened,” said Mace, who has served on the House Transportation Committee. “People should be able to fly on a random Wednesday morning and know that their flights are going to take off safely and securely. And we have a lot of — more questions than answers at this point.”  

Mace, who voted to impeach former President Trump following the Jan. 6, 2021, attack on the U.S. Capitol, has also used hits on cable news to criticize Rep. Matt Gaetz (R-Fla.), a loyalist to Trump and one the final remaining McCarthy holdouts.  

Rep. James Comer (R-Ky.) 

Rep. James Comer (R-Ky.) speaks to reporters after a closed-door House Republican conference meeting on Tuesday, January 10, 2023. (Greg Nash)

Comer, a former candidate for governor in Kentucky, is the incoming chairman of the House Oversight and Accountability Committee. He is another leading House Republican who is likely to get a decent dose of face time on cable news in the coming months as the GOP gears up to investigate the Biden administration. 

President Biden is under new scrutiny this week after two batches of classified documents were found at his Washington think tank and his home in Delaware, sending Republican critics into a frenzy and renewing calls for investigations. 

Appearing on Jake Tapper’s CNN program late last week, Comer, 50, vowed to have “the backs of the American taxpayers” as his committee conducts oversight of the executive branch, specifically on spending. 

“So, we’re concerned about the massive spending,” Comer told Tapper just hours before McCarthy was elected Speaker during a dramatic final vote. “We know there are reports of waste, fraud, and abuse of the unemployment insurance fund with some of the COVID money with these grants that are handed out in many of these government agencies. So, we just want to get to work and do our job and try to make sure that taxpayer dollars aren’t being wasted.” 

Source: TEST FEED1

Washington Post fact-checker gives GOP four 'Pinocchios' for IRS 'agents' claim

The Washington Post’s top fact-checker has given the GOP four “Pinocchios” for repeated false claims about federal funding for IRS personnel under President Biden’s administration.

Citing a series of comments made by House Speaker Kevin McCarthy (R-Calif.), House Majority Leader Steve Scalise (R-La.) and others, the Post’s Glenn Kessler labeled the GOP’s promise to “defund 87,000 IRS agents” a “zombie claim,” describing it as one that keeps “rising from the dead no matter how often they have been fact-checked.”

On Monday, the House passed legislation rescinding an IRS funding boost signed into law last year. The Family and Small Business Taxpayer Protection Act was a key part of the Republican platform ahead of the 2022 midterm elections and promises to rescind “unobligated balances of amounts appropriated or otherwise made available” to the IRS from the Democrats’ Inflation Reduction Act.

Republicans have repeatedly falsely described the 87,000 new IRS employees, who would be added over the course of a decade, as “agents.”

The 87,000 figure comes from a May 2021 Treasury Department compliance report estimating new hires at the IRS over a decade with the $80 billion funding boost. But only a small portion of the department’s current employees are agents, The Hill previously reported, and the department has said the figure accounts for other workers such as customer service representatives and computer scientists as well as replacements for the 52,000 employees expected to retire or resign within the next six years.

Kessler also took issue with GOP politicians using of the word “agents” in his report.

“We originally gave this claim Three Pinocchios because at least Republicans could point to a number in a Treasury report,” Kessler wrote. “But now, after repeated fact checks, there is really no excuse, and we are upping the rating to Four Pinocchios.”

A representative for McCarthy did not respond to a request for comment on Kessler’s fact-check.

Source: TEST FEED1

Trump Organization fined $1.6M in tax fraud case

The Trump Organization was ordered to pay $1.6 million in fines on Friday, following its conviction last month for criminal tax fraud, according to The New York Times.

It was the maximum penalty former President Trump’s sprawling business organization could face for what prosecutors have described as a long-running scheme to evade taxes by providing perks to company executives.

Trump himself was not charged in the tax fraud case, although the Manhattan district attorney’s office argued throughout the trial that the former president and his family were “explicitly sanctioning tax fraud.”

Allen Weisselberg, the longtime chief financial officer of the Trump Organization, was sentenced to five months in jail on Tuesday for his role in the tax fraud scheme. Weisselberg served as key witness in the monthlong trial after accepting a plea deal in August.

Lawyers for the Trump Organization reportedly argued for a lesser penalty on Friday, accusing Weisselberg of being the lone actor in the scheme, as they did throughout the trial. 

However, Judge Juan Merchan sided with the prosecutors, who argued for the full fine despite acknowledging that it “may have limited impact on a multibillion corporation,” according to the Times.

Manhattan District Attorney Alvin Bragg said in a statement that Friday’s sentencing represents a “significant chapter” in his ongoing investigation into Trump and his businesses.

“While corporations can’t serve jail time, this consequential conviction and sentencing serves as a reminder to corporations and executives that you cannot defraud tax authorities and get away with it,” Bragg added.

Trump and three of his adult children are currently facing a separate civil lawsuit from New York Attorney General Letitia James (D), who has accused the family of manipulating property values to secure investments, as well as tax and loan benefits. The case is set to head to trial in October.

Updated at 10:42 a.m.

Source: TEST FEED1

McCarthy says he will look at expunging Trump impeachment

Speaker Kevin McCarthy (R-Calif.) said on Thursday that he would consider expunging one or both of former President Trump’s impeachments.

“I would understand why members would want to bring that forward,” McCarthy said in response to a question at a press conference on Thursday, before listing off several other key priorities for House Republicans. 

“But I understand why individuals want to do it, and we’d look at it,” he added.

In the last Congress, a group of more than 30 House Republicans led by Rep. Markwayne Mullin (Okla.) put forward a resolution to expunge Trump’s impeachment in the wake of the Jan. 6, 2021, attack on the Capitol. The resolution was supported by the fourth-ranking Republican in the House, Republican Conference Chairwoman Elise Stefanik (N.Y.).

A smaller group, again led by Mullin, also introduced a resolution to expunge Trump’s December 2019 impeachment for allegedly attempting to withhold military aid from Ukraine in an effort to pressure the country to investigate the business dealings of President Biden’s son Hunter Biden.

The Senate ultimately acquitted Trump in both impeachments, after failing to reach the two-thirds majority required to convict him.

Source: TEST FEED1

The Hill's Morning Report — Classified papers in Biden's home; special counsel investigating

Editor’s note: The Hill’s Morning Report is our daily newsletter that dives deep into Washington’s agenda. To subscribe, click here or fill out the box below.

Classified documents unearthed between early November and this week – located in a private office space in Washington, in President Biden’s Wilmington, Del., garage before Christmas and in his home library on Thursday – resulted in an expanded investigation by a Justice Department special counsel.

Attorney General Merrick Garland announced at the Justice Department that experienced prosecutor Robert Hur, “in the public interest,” is now a special counsel for a probe into Biden’s newly uncovered classified documents. Hur is seen as a highly respected appointee of former President Trump who early in his career clerked for Supreme Court Chief Justice William Rehnquist. Hur, a former U.S. attorney in Maryland, has been praised by outgoing Gov. Larry Hogan (R).

The White House has described a batch of sensitive documents discovered a week before the midterm elections as dating from Biden’s time as vice president. The dates and contents of documents found Dec. 20 in the president’s garage, and by his lawyer in the president’s home library this week, were not described. 

Biden, who recently spoke to reporters about the discovery of two batches of classified documents, made no mention that some were uncovered at his home.  

Under the law, officials can be prosecuted for civil or criminal violations for mishandling classified records, and Garland said Hur’s job is to “investigate whether any person or entity violated the law.”

Biden’s retention of secret documents was not publicly known on Nov. 18 when Garland appointed a special counsel to investigate Trump’s handling of boxes of presidential records and hundreds of classified materials he and his lawyers moved from the White House to Mar-a-Lago and then resisted returning to the government for a year. The special prosecutor also is investigating evidence of efforts by Trump and his allies to subvert the 2020 election.

Trump is now a declared presidential candidate, and Biden is expected to soon announce a reelection campaign.

“This appointment underscores for the public the department’s commitment to both independence and accountability in particularly sensitive matters, and to making decisions indisputably guided only by the facts and the law,” Garland said on Thursday.

Former President Obama, near the end of his first year in office with then-Vice President Biden, issued with some fanfare a lengthy executive order dealing with classified national security information. The order made clear that “classified information may not be removed from official premises without proper authorization.”

In addition, the handling of sensitive documents with the National Archives and Records Administration by incoming and outgoing White House officials is known to be a detailed process with supervision and procedures. Biden has not explained how he transitioned out of government with classified papers in his possession, other than to say he was “surprised.”

Flashback: During an interview with CBS’s “60 Minutes” last fall, Biden said Trump’s storage of presidential records and secret materials at his Mar-a-Lago club and residence was “totally irresponsible.” Biden said he recalled asking himself, “How that could possibly happen – how anyone could be that irresponsible?” 

House Republicans have said they plan to probe Biden’s handling of classified records in oversight hearings.

The president and his White House team say Biden’s circumstances and Trump’s actions are different, maintaining that Biden’s personal lawyers and the administration took appropriate steps since November to cooperate with the Justice Department and the Archives.

Related Articles

▪ The Hill: What we know about the Biden documents so far.

▪ The Hill: Who is special counsel Hur, tasked to examine Biden’s handling of classified documents?

▪ The Hill’s Niall Stanage, The Memo: Biden document woes deepen. 

LEADING THE DAY

➤ CONGRESS

Speaker Kevin McCarthy (R-Calif.) said Thursday that he’s willing to consider expunging an impeachment of Trump by the Democratic-led House. The former president was impeached twice during his four-year presidency: once, in 2020, for withholding military aid from Ukraine in exchange for political favors; and a year later, for inciting the Jan. 6, 2021, Capitol riot. In the previous Congress, groups of Republicans floated resolutions to expunge both impeachments. Supporters of the latter included Rep. Elise Stefanik (N.Y.), the Republican conference chairwoman (The Washington Post).

It is highly unlikely McCarthy can get the votes to pass such a bill through the narrowly divided House and there is no chance in the Senate. 

Senate Democrats are under pressure to play defense against multipronged House Republican investigations of Biden and his administration — not to mention the issue of classified documents from his days as vice president — which will consume much of the House agenda this year in hopes of inflicting political damage on the president, writes The Hill’s Alexander Bolton. Senate Majority Leader Charles Schumer (D-N.Y.) has declined to say what Senate Democrats will do to counter the House investigations, but his vulnerable incumbents would prefer to focus on pursuing legislative goals instead of partisan warfare that will inevitably divide their constituents.  

▪ Bloomberg News: The GOP-led House voted to ban sale of oil reserves to China, but the bill likely won’t become law.

▪ The Hill: House Republicans unveil crypto panel.

Biden on Thursday went on the offensive against House Republicans, criticizing the first bills introduced by the chamber, specifically a piece of legislation that would strip roughly $71 billion from the Internal Revenue Service and target money Congress approved to help the IRS find and pursue tax cheats. Biden said he was “disappointed” that the early bill “would help wealthy people and big corporations cheat on their taxes at the expense of ordinary class taxpayers,” and cited a report from the Congressional Budget Office that found reducing IRS funds would curtail its ability to collect unpaid taxes, adding about $114 billion to the deficit over the next decade (The Washington Post).

“Is this how House Republicans are starting the new term: cutting taxes for billionaires, raising taxes for working families, and making inflation worse?” Biden asked. “Well, let me be clear: If any of those bills make it to my desk, I will veto them.  I will flat veto them. I’m ready to work with Republicans, but not this kind of stuff.”

Meanwhile, some Republicans are lining up at the chance to impeach Department of Homeland Security Secretary Alejandro Mayorkas, write The Hill’s Rebecca Beitsch and Rafael Bernal, even as others in the party stress that the process must begin with a thorough investigation. 

On Thursday, Rep. Andy Biggs (R-Ariz.), who had been one of the first members of Congress to call for Mayorkas’ impeachment announced that the fight was back on, posting on social media that he’d be updating his articles of impeachment against the secretary “with even more justification very soon,” (Business Insider).

Politico: Former GOP Gov. Pete Ricketts tapped to fill Nebraska’s open Senate seat.

Embattled Rep. George Santos (R-N.Y.), who has been accused of fabricating much of his resume and faces investigations in multiple jurisdictions, is finding himself in even more hot water. As The New York Times reports, a review of records and newly uncovered documents reveal that efforts to elect Santos may have run afoul of campaign finance rules.

The murkiness around the fundraising operations on behalf of the Long Island lawmaker makes it difficult to know whether any laws were broken. But a close examination of available records suggests RedStone Strategies — which raised significant money for Santos — may have skirted the law.

Santos has faced criticism and calls to resign from both sides of the aisle. Examples include the chair of the Nassau County Republican Party, the Nassau County executive and Rep. Anthony D’Esposito (N.Y.) the newly elected GOP lawmaker from a neighboring district, however, Santos has repeatedly said he will not step down.

Vox has charted out different ways the Santos scandal could finally end.

▪ Reuters: Santos says he won’t resign, only leave if voted out in next election.

▪ The Washington Post: Santos lied about being a volleyball “star,” county GOP chair says.

▪ CNN: McCarthy stands by Santos despite growing calls for resignation from other GOP lawmakers. 

➤ POLITICS

Trump is planning to hold the first public campaign event of his 2024 White House bid in the early-voting state of South Carolina later this month, his campaign announced. Since declaring his candidacy shortly after the midterm elections, the former president has limited his public campaign appearances to events at his Mar-a-Lago estate in Florida before an invited crowd or in a virtual setting (ABC News).

Virginia Gov. Glenn Youngkin’s (R) political brand is facing a potential setback after a series of disappointing GOP losses in the commonwealth ahead of what is expected to be a hard-fought battle for the General Assembly in November, writes The Hill’s Julia Manchester.  

On Tuesday, Democrat Aaron Rouse defeated Republican Kevin Adams in the state’s 7th Senate District, flipping the seat and expanding the Democrats’ majority in the chamber. That defeat followed an underwhelming showing in November’s midterms, which saw the GOP gain only one of several targeted swing seats in the state. Altogether, the losses have raised questions about the party’s strength in the commonwealth heading into the November state legislative elections, despite optimism following Youngkin’s 2021 victory.

The New York Times: His star rising, Youngkin juggles local issues and national ambition.

➤ ECONOMY

If the national economic goal this year is to slay inflation, even the tiniest drop in gasoline and food prices is cause for celebration at the White House. Biden on Thursday reacted to the consumer price index reported for December and offered a conclusion he hopes Americans share, even amid an annualized inflation index of 6.5 percent (CNBC).

The index, which measures the cost of a broad basket of goods and services, fell 0.1 percent in December. It was the largest month-over-month decrease since April 2020, around the time that workers and families began to stay home to avoid the spread of COVID-19. The Federal Reserve wants to see compellingly stable, lower inflation measures before ramping back on higher interest rates. That’s the data point investors and financial markets await. 

Biden’s most recent job approval yardstick is 44.1 percent, the highest it’s been since October 2021, according to polling aggregations published by FiveThirtyEight and RealClearPolitics.  

“Two years in, it’s clearer than ever that my economic plan is working,” the president said in prepared remarks. He pointed to low unemployment and wage growth as well as the number of Americans with health insurance before declaring, “We’re clearly moving in the right direction.”

▪ The Hill: U.S. Chamber of Commerce calls on Congress to end gridlock, saying businesses are “fed up.”

▪ The New York Times: Inflation is slowing — good news for American consumers and the Fed.

▪ The Wall Street Journal: Inflation report tees up likely quarter-point Fed rate rise in February.

▪ Vox: Three charts that explain what’s happening with U.S. inflation.

IN FOCUS/SHARP TAKES

➤ ADMINISTRATION

The Federal Aviation Administration software that caused thousands of flight delays and cancellations when it failed Wednesday is 30 years old and at least six years away from being updated, CNN reports. The Notices to Air Missions (NOTAM) database failure triggered the FAA to implement the first nationwide stop of air traffic in more than 20 years early Wednesday; since then, Transportation Secretary Pete Buttigieg has held multiple meetings with top FAA officials and “has made it very clear” he wants the NOTAM database updated much faster than the FAA’s planned timeline.

▪ NBC News: Aviation warning system that crashed was already a pain for pilots.

▪ Bloomberg News: FAA computer failure caused by people who damaged data file.

Biden is again criticizing Section 230 of the Communications Decency Act — that supporters call foundational to a free and open Internet, and detractors say leads to more disinformation and hate speech online — this time in a Wednesday Wall Street Journal opinion piece he used to invite Democrats and Republicans to take on Big Tech in a bipartisan way. The controversial provision protects companies from being sued over content posted by third parties on their platforms.

“We need Big Tech companies to take responsibility for the content they spread,” he wrote. “That’s why I’ve long said we must fundamentally reform Section 230 of the Communications Decency Act, which protects tech companies from legal responsibility for content posted on their sites.”

But in place of the existing law, Biden offers little suggestion for a replacement. Google, meanwhile, argued that if the Supreme Court rules to scale back a liability shield for internet companies, the decision could lead to more censorship and hate speech online (The Hill).

➤ INTERNATIONAL

Fierce fighting in eastern Ukraine’s Soledar is ongoing as Russia hopes to take complete control of the salt mining town for an advantage against the bigger prize: Bakhmut. As The Hill’s Brad Dress reports, the city of Bakhmut, at the edge of the eastern Donetsk region of Ukraine, is a strategically important city for both Ukraine and Russia in the war. For Russia, control of the city would likely lay the groundwork for a push northwest, toward the cities of Sloviansk and Kramatorsk, according to military analysts. Still, Russia does not appear to have the entirety of Soledar within its grasp, although it made significant gains this week through brutal tactics, including leveling the town with artillery strikes and throwing a mass wave of prisoner soldiers at Ukraine’s lines.

▪ Reuters: Scale of alleged torture, detentions by Russian forces in Kherson emerges.

▪ The Washington Post: Poland urges allies to join it in sending Leopard tanks to Ukraine.

▪ The New York Times: Western tanks appear headed for Ukraine, breaking another taboo.

A month after scrapping most of its zero-COVID restrictions, China is experiencing all at once what many other nations have been navigating for three years. 

Infections have skyrocketed, medical facilities are stretched to their limits and the elderly and immunocompromised are dying — although official government statistics are seen by public health experts as vastly underestimating the number of COVID-19-related deaths (The Wall Street Journal).

▪ Reuters: China set for historic demographic turn, accelerated by COVID-19 traumas.

▪ The Washington Post: The United Arab Emirates appoints oil exec to lead COP28 climate talks, sparking outrage.

▪ The New York Times: In a first, South Korea declares nuclear weapons a policy option.

▪ CBS News: Suspect in assassination of former Japanese Prime Minister Shinzo Abe charged with murder more than six months later.

▪ The Washington Post: Socked in by smog, Indian officials invest heavily — in public relations.

OPINION

■ GOP thrusts Biden’s boiling-children-in-oil plan into the culture wars, by Charles C.W. Cooke, senior writer, National Review. https://bit.ly/3H1uMEs

■ Behind the Biden classified-docs fiasco is the feds’ obscene abuse of “secrecy,” by James Bovard, opinion contributor, The New York Post. https://bit.ly/3kgDlCA

WHERE AND WHEN

A note to readers: Morning Report will be off on Monday in observance of Martin Luther King Jr. Day; look for The Hill’s Tipsheet in your inboxes to keep up with the latest news.

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The House will convene at 11 a.m., but no votes are expected. Members will return for legislative business on Jan. 24. 

The Senate will meet at 1:30 p.m. for a pro forma session. 

The president will receive the President’s Daily Brief at 9 a.m. Biden will welcome Prime Minister Fumio Kishida of Japan to the White House at 11:15 a.m. for meetings and a working lunch. They are expected to focus on national security issues. The president will depart the White House at 1:45 a.m. for Delaware.

Vice President Harris will host the Japanese prime minister for a working breakfast at the vice president’s residence at 10 a.m.

Secretary of State Antony Blinken delivers remarks and signs a U.S.-Japan Space Cooperation Framework Agreement with the Japanese prime minister, Japanese Foreign Minister Yoshimasa Hayashi and NASA Administrator Bill Nelson at 4:30 p.m. in Washington, D.C. 

Treasury Secretary Janet Yellen will ceremonially swear in Jay Shambaugh as under secretary of the Treasury for international affairs. Yellen will also join the president this morning in his bilateral meeting with the Japanese prime minister.

Second gentleman Doug Emhoff at 11 a.m. will deliver welcoming remarks at a White House naturalization ceremony in recognition of National Religious Freedom Day. 

The White House daily press briefing is scheduled at 12:30 p.m. and will include Keisha Lance Bottoms, the president’s senior adviser for public engagement.

ELSEWHERE

➤ HEALTH & PANDEMIC

Long COVID-19 symptoms — from shortness of breath to loss of taste and smell — for many patients will ease over a year, according to new research. The study, a collaboration between KI Research Institute and Maccabi Healthcare Services in Israel, was published Wednesday in The BMJ, a medical journal. The study did not include patients who developed long COVID-19 from omicron or its subvariants, but doctors in the U.S. say they do see new patients with long COVID-19 symptoms following an omicron infection (NBC News).

“For the vast majority of patients,” said study author Maytal Bivas-Benita, “this will get better.” 

▪ VeryWell: What you need to know about the COVID-19 XBB.1.5 “kraken” variant.

▪ The Atlantic: Are our immune systems stuck in 2020?

▪ The Washington Post: Slide in measles vaccination rate among kindergartners raises alarm.

▪ The Hill: Transgender youth health care bans have a new target: adults.

Information about the COVID-19 vaccine and booster shot availability can be found at Vaccines.gov.

Five percent of young adults now identify as nonbinary or transgender, communities that society barely recognized and seldom counted until a few years ago, writes The Hill’s Daniel de Visé. The notion that millions of Americans reject their birth gender feels new, researchers say, but the population is not. Only recently have surveys asked if people identify with a gender other than the one assigned at birth. More important, perhaps, is growing acceptance of gender fluidity, at least among the young. 

One landmark UCLA study found that three-quarters of all nonbinary adults are under 30, which suggests Generation Z has explored gender identity in a way that older Americans have not. Researchers also found an alarming rate of suicidal ideation in the nonbinary and transgender communities, perpetual targets in conservative culture wars. Simply honoring a person’s chosen name and pronouns, mental health workers say, can literally save their life.   

Total U.S. coronavirus deaths reported as of this morning, according to Johns Hopkins University (trackers all vary slightly): 1,099,473. Current U.S. COVID-19 deaths are 3,907 for the week, according to the Centers for Disease Control and Prevention. (The CDC shifted its tally of available data from daily to weekly, now reported on Fridays.)

THE CLOSER

And finally … 👏👏👏 Congratulations to the winners of this week’s Morning Report Quiz! Victorious puzzlers easily navigated American history and last week’s marathon House Speakership votes.

Morning Report’s trivia masters who went 4/4: Paul Harris, Mary Anne McEnery, Patrick Kavanagh, Bill Grieshober, Alla Yun, Harry Strulovici, Amanda Fisher, Peter Spofera, Pam Manges, Jonathan S. Berck, Randall S. Patrick, Tim Mazanec, Daniel Bachhuber, Ki Harvey, Cliff Grulke, Steve James, Terry Pflaumer, Dan Mattoon and JA Ramos.

They knew that while the 118th Congress needed 15 ballots to elect a Speaker, the historical comparison and highest number of ballots required was 133, in a Speakership election that stretched for months between 1855-1856.

The Constitution stipulates that tax bills must originate in the House.

America’s first Speaker was Frederick A.C. Muhlenberg, a Pennsylvania minister.

James K. Polk is the only U.S. president who also served as Speaker.

Stay Engaged

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Democrats in tough spot with Biden classified documents

Senate Democrats are finding themselves in a tough spot as they try to figure out how to best respond to revelations that President Biden had improperly stashed classified documents at his personal office in Washington and in his garage in Delaware.  

The Democrats’ position is made trickier by not knowing exactly how sensitive the documents are, nor how they came into Biden’s possession during or after his service as vice president in the Obama administration.  

Downplaying or dismissing the seriousness of the situation will be difficult after Democrats relentlessly hammered former President Trump for improperly storing classified documents at Mar-a-Lago — though there are important differences between Biden’s and Trump’s situations.  

“The classified documents stuff will be painful because Democrats made such a huge thing out of the Trump classified documents thing. The reality is everything is under the sun is classified and officials treat them as they stay in office [or leave] with less and less respect,” said Robert Borosage, a progressive activist and co-director of Campaign for America’s Future.

He said the gravity of Biden’s political problem “depends on what the documents are.” 

“Whether the investigations damage Biden depends on what they find,” he said of efforts by House Republicans. The new House GOP majority hasn’t been shy about its plans to inflict as much political damage on the president as possible by shining a light on his handling of classified documents, as well as the business dealings of his son, Hunter Biden.  

Attorney General Merrick Garland on Thursday appointed veteran prosecutor Robert Hur to serve as special counsel to investigate whether Biden’s possession of the classified documents violated the law and merits charges. He made the announcement just a few hours after the White House confirmed the discovery of a second cache of documents.  

Garland had come under pressure from Republican Sens. Lindsey Graham (S.C.) and Josh Hawley (Mo.), two members of the Senate Judiciary Committee, who called for equal treatment of Biden and Trump. Garland appointed career prosecutor Jack Smith to serve as special counsel overseeing investigations of Trump in November.  

Senate Democrats, who control the committees and have subpoena power in the upper chamber, have responded cautiously so far.

Senate Intelligence Committee Chairman Mark Warner (D-Va.) earlier this week called for administration officials to brief his committee on which documents were in Biden’s possession, something he also asked for when Trump was discovered to be holding onto classified documents at Mar-a-Lago.  

Warner, however, drew a distinction between Biden, who turned over the documents immediately to the U.S. National Archives, and Trump, who engaged in “a month-long effort to retain material actively sought by the government,” according to Warner’s statement. 

A Senate Democratic aide said it’s “impossible to know” how Biden’s personal possession of classified documents will play out until “we know more about the facts — what’s the nature of these documents?” 

“I don’t read much into the fact that a special counsel has been appointed. I don’t think Garland had much choice. I’m sure we will find out sooner or later if one could reasonably understand how these documents got to where they were,” the source added. “Are these things problematic?”  

But Democrats are praising Biden for alerting the Justice Department to the problem and immediately turning over the documents in question, in contrast to Trump’s refusal to hand over sensitive information, which prompted the FBI to raid his residence in September.  

Senate Republicans, on the other hand, are playing offense right out of the gate, demanding to know why the Justice Department waited several months, until after the midterm election, to make the disclosure.  

“Many questions remain as to why the discovery of classified documents — found several days before the midterm election — was not announced until after the election,” Graham said in a statement Thursday. “The bottom line is we need to fully understand what happened in both cases — involving President Trump and Biden — to make sure our system works in a way to protect our national security interests.”  

Ross K. Baker, a professor of political science at Rutgers University, who served several Senate fellowships, said Biden’s best defense would be to fully admit any mistakes he made and cooperate with the Justice Department investigation.  

“It’s one of these situations where it’s really important to be as forthcoming as possible and admit when there have been careless errors made. I don’t think there’s any suggestion at all that these papers were being used for some political purpose,” he said. “Sometimes it’s important for even a president to admit a mistake.” 

Baker called the improper possession of classified information the biggest scandal of Biden’s term in office so far.  

He said Democrats who want to defend Biden need to follow the president’s lead.  

“The president is pretty good about coming across to the public as sincere and even penitent if the occasion presents himself. He’s got to be the opposite of Trump on this,” he said. “Biden has been very straightforward about the fact that the papers were in his possession and should have been returned but weren’t.”  

Senate Majority Leader Charles Schumer (D-N.Y.), who has the tough job of defending 23 Democratic-controlled Senate seats in the 2024 election, on Thursday sought to shift the focus back onto what he called the House Republicans’ “extreme” agenda.  

“In the last week Republicans have given a free pass to wealthy tax cheats, empaneled a committee to undermine and threaten law enforcement, undercut women’s healthcare, and put forward a draconian budget plan that will lead to cuts to Medicare and Social Security and defunding the police,” Schumer said in a statement. “Senate Democrats will put the American people first and stand as a firewall to this extreme MAGA Republican agenda.” 

A Senate Democratic aide said one way to defend Biden from efforts by Republican lawmakers to tarnish his reputation is to point out various issues of greater practical importance to the American public that Democrats believe the new House GOP majority is failing to address.  

House Republicans, who control a slim five-seat majority, already plan to investigate Biden and his administration on multiple fronts, ranging from what they are calling the “weaponizing” of the federal government against conservatives to the business dealings of Biden’s family.    

“There’s a limit to how much protection can be done, but you can make clear what the House Republicans are failing to pay attention to,” the aide said. “When the Republicans go off the deep end, Democrats have the ability to explain and defend the president on the basis of what is actually going on.”  

Source: TEST FEED1