Press Briefing: Loss of Government Funds, Market Volatility, Syria
STEVE INSKEEP, Moderator:
Months of false start-ups, political struggles and the deadline missed by the parliament culminated overnight, again missing the deadline.
David Green, Moderator:
That’s right. The Senate failed to pass the spending bill before midnight, so the government funds failed. This is largely symbolic, as most federal offices have been closed overnight. Reasons for all these – Republican Sen. Rand Paul. Although the Senate has enough votes to pass the budget bill, Paul postponed the vote. He wanted to raise the idea of increasing spending.
Rand Paul: Uh, you know? To be frank, I think this country deserves to be debated at 3 a.m.
INSKEEP: He just fulfilled his wish. The Senate resumed at 1 am until 2 am and they passed their spending bill.
Green: And then throw it to the House, and now it’s voting on the bill – and we should say that the bill does not include changes in immigration policies that Democrats so desperately want.
INSKEEP: NPR Congresswoman Susan Davis is here to guide us through all this. Su, you have been overnight.
Susan Davis, Connection: I have not been overnight, but you know, I tuned early.
Davis: We seem to have a solution to get it as soon as possible. I think this bill and overnight anxieties tell us that when you make a lot of bipartisan agreements, it often leaves a lot of lingering feelings on the left and right.
INSKEEP: This is a marginal situation, especially in the Senate. So one can say, wait a minute, wait a minute, I need to paint a little work here, because I have something to explain.
Davis: His work does mess up, though he has never really changed the result. From the very beginning, they knew that the bill would be passed by the Senate. It votes with 71 votes. These days are many in the Senate. But Rand Paul also has a point, right? What he refers to is that the Republicans in the Republican-controlled government voted more than they agreed with Barack Obama.
INSKEEP: This is what we hear from other lawmakers. Warren Davidson, Ohio – Ohio Republican – sits in your chair the day before, saying I do not understand what’s going on here. This is not what we did to another president.
Davis: This is likely to be a vote – no matter what the outcome – not the last thing we heard. This is a major challenge Republicans may face, and Democrats may try to ask a question in the election that they look at you – on their promises of winning a majority in 2010 – to fulfill their fiscal responsibilities – to reduce the size of the government. So far they have not done that yet.
INSKEEP: Predict Federal Budget Deficit – Expenditure on Tax Revenues Exceeds Budget – Has Rampantly – Will That Number Increase Even Before This Expenditure Is Reached this Year?
Davis: It was because of the passage of the $ 1.5 trillion tax cut that even congressional estimates expect a $ 1 trillion deficit over the next ten years. You spend roughly $ 400 billion in spending packages, just reading, as long as the eyes can read and read. Just a few months ago, the United States crossed the $ 20 trillion debt rubicon. To the financial conservatives, it is depressing that in the State of the Union address, President Trump never raised any debt or deficit.
INSKEEP: debt rubicon – I think this may be the title of the book you wrote.
Davis: (Laughter) A very dull book …
INSKEEP: … Covers Congress, I think.
Davis: … but a very important book.
INSKEEP: That’s it. There are many intersections involved. So, very brief, as we are talking about right now. The House has yet to pass this spending measure. But let’s prescribe it, let’s suppose now that it’s over. What is your general concept of the act? What is this bill?
Davis: It basically allows us to turn off the roller coaster for the next two years. It set the level of spending in 2018 and 2019, and should allow Congress to write budget and spending bills to discourage these conversations. Now a big issue about this act is what happened to the immigration office. Their two destinies have been linked because the congress will move to immigration. Senate Majority Leader Mickey McConnell made a statement on the motion shortly after the Senate passed the motion. They will start a debate on immigration next week. We do not know how long it takes or where it goes.
INSKEEP: Sue, thank you very much.
Davis: You’re welcome.
INSKEEP: This is NPR’s Susan Davis.
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INSKEEP: Next, we have a correction – not a fact-checking type, but.
Green: No, we’re talking about financial terms, you know, Steve, it sounds a bit like euphemism. The stock market’s decline is at least 10% of the recent high, which happened after another sharp sell-off yesterday. We should keep this view here. These are not historically bad days for the market, and the day is already very hot. But this is enough to give you more general suspicion about the health of the U.S. economy. Of course, it is worth asking the next step.
INSKEEP: We’ll ask John Ydstie, an NPR economics journalist. Good morning, John.
JOHN YDSTIE, Connection: Good morning, guys.
INSKEEP: Are you a little scared?
INSKEEP: So people say, correct, no big deal. It’s just one of those natural events on the market. But I guess if you are those who have just dropped 10% of the portfolio, you do not necessarily think so.
YDSTIE: Yeah, all of our portfolios can go down, but some people lose more ways, so they are panicky.
INSKEEP: Yes. We have made it clear in recent days that not everyone invests in the stock market. More than half of Americans own shares directly or through a fund, but more than half of Americans still have some money lost here. So what caused another day to fall? What prompted another Wall Street regression day?
YDSTIE: Well, I think – you know, here are a few things that work. First, how many times have you been asked last year when stocks were overvalued? Well, it turns out that they are.
YDSTIE: They are – at least they are. There is a lot of prosperity in the market and great enthusiasm for tax cuts. The stock market rose 7% in January – the growth rate is unbelievable. Then interest rates go up. You know, they are close to zero in a few years. This helps to make the stock the only place where your investment receives a good return. Investors worry interest rates will rise faster. A week ago, we got strong employment growth figures and strong wage figures from the employment report. This means that the Fed may be able to speed up the interest rate, which helps trigger – really triggered such a sell-off.
Then the market actually worried about the Fed. We have a new chairman of the Federal Reserve, Jerome Powell, who said he will follow Yellen’s step-by-step increase of interest rates. But, you know, there are a few places in the Fed’s policy-making committee that the market does not know who will fill them, and whether they want to speed up their rates. Then, Steve, we still have low volatility in the markets for those involved in this investment program.
YDSTIE: They are still selling stocks to make up for the losses. At least we think they are. What they are doing is not very transparent. Then, you know, we already have the budget that Su Davis talks about. As a result, investors are worried about the long-term health of the economy.
INSKEEP: Okay. We will leave it there and keep watching the market because they have been through the day. John, thank you very much, thank you very much.
YDSTIE: You bet.
INSKEEP: This is John Ydstie of NPR.
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INSKEEP: Okay. There are currently about 2,000 U.S. troops in Syria, some of whom were shot earlier this week.
Green: We should say that fortunately no Americans were killed. They responded with some large-scale air power. But this is what happened – the attack was not initiated by the Islamic State and is a sign of how complex the war has become.
INSKEEP: Yes. No two sides. There are many aspects. We’re going to discuss here with NPR’s Tom Bowman, who had just spent three dramatic days in Syria and saw it all. He is out now. Hello, Tom.
TOM BOWMAN, Connection: Hi, Steve.
INSKEEP: Who would launch an attack if it was not for ISIS to attack the U.S. Army?
Bowman: Steve, a Syrian government militia backed by Russia and 500 of them using tanks and artillery, attacked Syrian rebel bases backed by the United States. There are some U.S. military advisers there. Now, these artillery attacks came, Steve, within a few hundred yards of the rebel base. We talked to the Syrian rebel commanders in the area. He said he called the Russians because there was a formal process to avert any military accident.
INSKEEP: Of course.
Bowman: That is normal. He said the Russians denied any attacks. Let’s listen.
Anonymous: (by translating) They deny it. They said we did not have any information about the attack (incomprehensible).