Happy Tuesday and welcome back to On The Money for the final time during Donald Trump’s term. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.
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THE BIG DEAL—Yellen champions big spending at confirmation hearing: Treasury Secretary nominee Janet YellenJanet Louise YellenOn The Money: Retail sales drop in latest sign of weakening economy | Fast-food workers strike for minimum wage | US officials raise concerns over Mexico’s handling of energy permits The Hill’s Morning Report – How many Republicans will vote for Trump’s impeachment? On The Money: Sanders will be gatekeeper for key Biden proposals | Senate majority gives Biden path to student loan forgiveness | Confirmation hearing for Yellen expected next Tuesday MORE urged senators Tuesday to “act big” on economic relief and warned that the pandemic-ravaged economy would suffer from deep, long-term damage without sufficient federal aid.
During her confirmation hearing before the Senate Finance Committee, Yellen said it was crucial to approve more support for struggling households and small businesses despite the steep financial cost of fighting the dual health and economic crises.
“Neither the president-elect, nor I, propose this relief package without an appreciation for the country’s debt burden,” Yellen said. “But right now, with interest rates at historic lows, the smartest thing we can do is act big. In the long run, I believe the benefits will far outweigh the costs, especially if we care about helping people who have been struggling for a very long time.”
The Hill’s Naomi Jagoda, Niv Elis, and I bring you to the hearing here.
GOP concerns, but little opposition: Yellen appears to be a safe bet for confirmation. She’s got deep credentials, has already been vetted for high-level positions, and has received bipartisan praise. Even so, while Republicans showed little opposition to her nomination, they fiercely criticized the scale and scope of Yellen’s plans to support the economy.
“I look forward to working with you, but I have to admit that the contours of the stimulus bill as proposed by the administration are going to make that difficult,” said Sen. Pat ToomeyPatrick (Pat) Joseph ToomeyGovernment used Patriot Act to gather website visitor logs in 2019 Appeals court rules NSA’s bulk phone data collection illegal Dunford withdraws from consideration to chair coronavirus oversight panel MORE (R-Pa.).
“The only organizing principle that I can discern is it seems to spend as much money as possible, seemingly for the sake of spending it.”
Read more from Yellen’s confirmation hearing:
LEADING THE DAY
Biden tax-hike proposals face bumpy road ahead: President-elect Joe Biden and congressional Democrats have signaled plans to raise taxes on wealthy individuals and corporations, but significant hurdles remain even with Democratic majorities in the House and Senate.
This month’s Democratic sweep of Senate runoffs in Georgia, giving Democrats control of the Senate for the first time since 2014, increases the odds of tax proposals advancing through Congress. However, slim margins in both the House and the Senate mean enacting tax increases will prove challenging.
“Getting them to agree on a legislative proposal will not be easy,” said Jorge Castro, a former congressional aide and counselor to the IRS commissioner during the Obama administration who now works on tax law at Miller & Chevalier. Naomi explains why here.
Uphill battle on minimum wage hike: Biden is also facing blowback from some Republicans for proposing increasing the federal minimum wage to $15 per hour.
Biden won plaudits from progressives for including a policy to increase the federal minimum wage for the first time in over a decade in his $1.9 trillion relief package unveiled on Thursday.
But some lawmakers on the other side of the aisle were quick to criticize that component of his plan, arguing it would hamper, rather than help, the recovery. Niv breaks it down here.
Debt cloud hangs over Trump post-presidency: President Trump faces an increasingly challenging financial future after he leaves the White House on Wednesday.
- Trump is on the hook for hundreds of millions of dollars of debt, most of it due within the next four years, and the legacy of his presidency may leave him with few options to pay it off.
- In the wake of the Capitol riots, the New York City government and the PGA of America backed away from business arrangements with the Trump Organization, sapping future income from the debt-laden president.
- Three banks have announced they’re cutting ties with him — including Deutsche Bank, his biggest creditor — limiting his ability to refinance debt.
A full picture of Trump’s financial health is impossible to assemble without the tax returns and other financial documents he has refused to release for years. Even so, experts say that based on what is known about his wealth and obligations, the president could face a barrage of lawsuits and collection attempts that could ultimately lead to personal bankruptcy. I’ve got more here.
GOOD TO KNOW
- President Trump is closing out his time in office with a significant increase in the stock market, but has fallen short of stock gains seen under predecessors former Presidents Obama and Clinton.
- Supermarket chain Aldi announced Tuesday that it would provide front-line workers in the U.S. up to four hours of paid leave so they can receive two doses of the coronavirus vaccine.
- President-elect Joe Biden has chosen two veteran regulators to lead the Securities and Exchange Commission (SEC) and the Consumer Financial Protection Bureau (CFPB).
- A coalition of 40 anti-monopoly groups are urging the incoming Biden administration against appointing former Big Tech employees to key antitrust roles in the government.
ODDS AND ENDS