Hope your Wednesday is going well. Congress spent much of the day debating gun violence, though the prospects for substantial bipartisan agreement on the issue are uncertain at best.. Hopefully lawmakers can do something meaningful.

Here’s what else is going on.

White House issues new Covid funding warning

A White House official said Wednesday that the lack of additional congressional funding for the federal response to the Covid-19 pandemic is forcing the administration to make “unacceptable compromises” as it maneuvers to acquire new vaccines more powerful in the fall.

“Due to a lack of additional funding,” the official said.
told CNN
the Department of Health and Human Services “is now obligated to draw funds from other essential elements of our response to meet certain basic Covid-19 response needs. This will allow the United States to wait in line to procure additional life-saving vaccines for the fall, including next-generation vaccines if available, and to procure additional life-saving treatments.

The official said that even with the reshuffling of funds, the administration will not have enough money to acquire all the vaccines, treatments and equipment that may be needed in the fall.

Last week, Dr Ashish Jha, the White House coronavirus response coordinator, told reporters he was worried about what might happen later this year. “If you want [know] what keeps me up at night is that we will run out of vaccines,” he said. “We are not going to be able to get enough of the next generation of vaccines. We will run out of treatments. And we’re going to run out of diagnostic testing, probably from late fall into winter, if we end up having a big spike in infections.

The bottom line: The White House has asked for $22.5 billion to fund its Covid-19 efforts, which lawmakers cut to $10 billion. But that little package has stalled in Congress amid fights over funding sources and border policies, and there’s no clear timeline on when lawmakers might take it up again.

House passes $1.6 trillion spending cap for 2023

The House of Representatives passed a $1.6 trillion “presumption resolution” on Wednesday, setting the cap on federal discretionary spending in 2023. annual spending, even as negotiations continue with the Senate on the details.

The 218-205 vote to pass the resolution came amid a gun control debate on the House floor — a move that was criticized by some Republicans, who all opposed the measurement. House Budget Ranking Member Jason Smith (R-MO) accused Democrats of “sneaking their spending levels for the upcoming appropriations process into a rule for a totally standalone bill so that they don’t have to debate or defend their out-of-control spending habits.” .”

House Democrats said they were simply doing their job using a technical procedure to keep the appropriations process on track. “Setting a discretionary upper line is a core responsibility of the budget committee in the appropriations process,” said Chairman John Yarmuth (D-KY). “This resolution supports President Biden’s budget request for FY23 with an increased level of discretionary funding of $1.6 trillion – a 9% increase over levels enacted for FY22.”

Still, budget hawks were unhappy with the way things went, accusing lawmakers of failing to live up to their budget responsibilities. “It’s beyond disappointing that Congress isn’t even trying to pass a budget this year,” Maya MacGuineas of the Committee for a Responsible Federal Budget said in a statement. “In fact, they don’t even pretend to try. What’s the point of having a budget committee if they’re never going to present a budget? »

quote of the day

“For a president, inflation is the problem from hell – you can’t win. Because it’s so hard economically, politically it’s even worse: there’s nothing you can do short term to solve it.

— Elaine Kamarck, Senior Fellow at the Brookings Institution, speaks with
The New York Times
on the challenges facing the Biden administration as inflation continues to climb.

The deficit is only a fraction of what it was last year

The federal budget deficit totaled $423 billion in the first eight months of the current fiscal year, which began last October, the Congressional Budget Office said in a statement. estimate

released on Wednesday. Revenue increased by $768 billion (29%) in 2022 over the period, while expenses decreased by $873 billion (19%).

The totals represent a huge drop in the size of the budget deficit, driven by the expiration of pandemic emergency spending and an increase in revenue related to the recovery. “This amount represents about one-fifth of the $2.1 trillion revenue shortfall recorded during the same period in 2021,” CBO said.

The deficit for the full year is expected to be $1 trillion, a reduction of $1.7 trillion from a year earlier.

Global corporate tax plan in jeopardy

More than 130 countries have agreed in principle to change the way big businesses are taxed in their jurisdiction, a move that would represent “the most sweeping changes to the international tax system in a century”, according to Alan Rappeport of the New York Times. But the tax overhaul is now ‘bogged down in a toxic mix of fine print and political paralysis’, Rappeport

said
raising the question of whether it will ever be implemented.

The plan has two main parts: 1) impose a minimum corporation tax of 15%, so that companies cannot game the system by setting up offices in low-tax countries like Ireland and the Netherlands ; and 2) taxing income where it’s earned, so companies can’t shift profits to countries like Bermuda and the Cayman Islands to lower their tax bills. The plan would also allow countries to impose higher tax rates on some of the world’s largest multinationals.

Despite the multinational agreement announced last fall, many problems remain. In the United States, the tax proposal has been closely linked to the Democrats’ Build Back Better social spending plan, which would require the support of all Democrats in the Senate to pass – and which now appears virtually dead.

Other countries could also serve as stumbling blocks. While Ireland, which has prospered for years thanks in large part to its low corporate tax rates, has finally agreed to participate, Poland is now expressing concerns over some technical aspects of the deal.

During Treasury Secretary Janet Yellen’s recent trip to Europe, Poland was her first stop, in part to discuss the tax plan. His assessment of the situation was cautiously optimistic. “I think it’s not hopeless,” Yellen said of ensuring Poland sticks to the deal. “It is certainly possible that this will happen.”

Even if Poland can be brought back on board, challenges will remain as each participating country tries to implement the deal. “If the United States and Europe fail to comply with the agreement, the global agreement risks unraveling,” Rappeport said. “That would mean the continuation of a hodgepodge of tax rates and related tariff fights around the world.”

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