An earthquake in the Senate Tuesday night with Roy Moore win

The 2018 election map looks marvelous for Republicans. The Republicans only have to play defense in Nevada, and can put the Democrats on defense across the map. Out of the 25 Democrat-held Senate seats up for re-election, President Trump won ten of the states and lost two more by razor-thin margins. Surely the Republican Party is gearing up for a monumental election season. Surely the Republican elites are preparing to challenge Democrats in all twelve of those states. Surely the establishment is saving its money and wisely spending it to target Democrats. Lest we forget, these are D.C. Republicans?

On Tuesday, the Alabama electorate sent shockwaves through the Republican establishment elites of the nation. The underfunded challenger, Judge Roy Moore, soundly defeated the cash-rich incumbent, Sen. Luther Strange, in the Republican primary by over nine points. Strange didn’t just raise more money, he had the entire establishment behind him, including a few very powerful PACs.

The Senate Leadership Fund is Senate Majority Leader Mitch McConnell’s (R-Ky.) personal PAC. For this race, it doled out over $7.9 million for Strange according to Issue One, a nonprofit that analyzes money spent on elections. In total, over $30 million was spent by outside groups and the RNC to re-elect the establishment incumbent. This begs the question, why would Republican-leaning groups spend millions in a Republican primary?

For some unknown reason, it was believed that Moore would have a tough time in the general election. This is the same man that was twice elected to the Alabama Supreme Court. This is also in a state that hasn’t elected a Democrat state-wide since 2008 and hasn’t elected a Democrat to the Senate since 1992.

Now that the primary is over, surely we can all get along?

The McConnell fund issued the following statement, “We are proud to have fought alongside President Trump and the NRA in support of a dedicated conservative who has loyally supported this President and his agenda. Senator Strange can hold his head high knowing that he played a critical role in cleaning up the corruption in Montgomery, confirming President Trump’s choice for the Supreme Court, and strongly supporting the President’s priorities on border security and repealing Obamacare. While we were honored to have fought hard for Big Luther, Judge Roy Moore won this nomination fair and square and he has our support, as it is vital that we keep this seat in Republican hands.”

Despite the statement of support, McConnell’s fund still has negative stories about Judge Moore on its website, so it’s kind of hard to take them seriously.

If McConnell does wish to be taken seriously, we can expect millions to be poured into the state for Moore. After all, according to leadership, it’s going to be a tight race.

Aside from wasting millions, Republican leadership now has another problem. Because McConnell went negative against fellow Republicans, the damage must now be undone. McConnell constantly pushed negative stories about Moore and Rep. Mo Brooks (R-Ala.) from uber-liberal progressive news sources, in effect doing the work of the Democrats. McConnell attempted to poison the electorate to get the win. Now other PACs must come in behind leadership and spend money to rehab the image destroyed by the Republican elites.

At this point, donors have to be asking themselves, “Is my money being well spent?”

Aside from the race being a fiscal disaster for the Republican elites, the defeat has changed the landscape for the remaining incumbent Republican Senators.

In a statement, Americans for Limited Government President Rick Manning blasted the development, saying, “Republican primary voters are sick of the do-nothing status quo which is leaving Obamacare intact, and sitting Republican Senators will face the brunt of this intraparty anger as we’ve already seen.”

Chris McDaniel is looking at Sen. Roger Wicker (R-Miss.), Kelli Ward is looking at Sen. Jeff Flake (R-Ariz.), and Danny Tarkanian is looking at Sen. Dean Heller (R-Nev.). Are Republican leaders willing to spend more money defending incumbent Senators from primaries in safe Republican seats than winning new seats?

The 2018 election map does look great for Republicans unless you are an incumbent. If an incumbent Senator is supported by McConnell and Republican leadership, that Senator is seen as part of the problem by the grassroots. The millions being doled out by leadership funds are seen as a signal to the base, that person is part of leadership. Republican leadership should recognize how their base feels about them and spend their money wisely. Concentrate on winning new seats, and let the primary process play itself out, otherwise, your one-million-dollar donation to an incumbent will do more harm than good.

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Briefly: The GOP's tax framework

President Trump and congressional Republicans rolled out a sweeping tax overhaul proposal on Wednesday that won immediate praise from conservatives, uniting a party that had been divided over how to repeal ObamaCare.

Business groups and the far-right House Freedom Caucus both backed the GOP blueprint to slash business taxes and trim the number of individual tax rates as Republicans looked to quickly move on from another failure to repeal the health care law.

Trump and his congressional allies are salivating for a major legislative win after a year filled with losses and disappointments, most of them related to a failed effort to repeal and replace ObamaCare. Their new hope is tax reform, which on the surface at least offers plenty for Republicans to agree upon.

Trump, seeming more at ease discussing tax compared to health care, said the framework “represents a once-in-a-generation opportunity to reduce taxes, rebuild our economy and restore America’s competitive edge.”

The president stressed that the benefits would go to the middle class, not the wealthy, though Democrats disputed that assertion.

“I’m doing the right thing, and it’s not good for me, believe me,” Trump said at an event in Indiana to sell the plan.

“This is the right tax cut and this is the right time. Democrats and Republicans in Congress should come together finally to deliver this giant win for the American people and begin [a] middle-class miracle.”

The president traveled to Indiana with Democratic Sen. Joe Donnelly, who is facing a tough reelection race in a red state. He pressured the senator to back his efforts, threatening to campaign against him if he declined.

The nine-page plan calls for three individual tax rates of 12 percent, 25 percent and 35 percent, while expressing openness to an additional rate that’s higher than 35 percent. The top rate is currently 39.6 percent.

The framework also would lower the corporate rate from 35 percent to 20 percent and would cut the rate for “pass-through” businesses whose income is taxed through the individual code, to 25 percent. It would also nearly double the standard deduction and would repeal the estate tax and the alternative minimum tax.

The blueprint gives Republicans a chance to turn their attention away from their failed efforts to repeal ObamaCare, a defeat in the skirmish over the debt ceiling, where Democratic leaders struck a deal with President Trump, and lack of action on Trump’s border wall.

The document was widely praised by GOP lawmakers, including the leaders of the conservative Republican Study Committee and Freedom Caucus, two groups that can act as thorns in leadership’s side.

“They’ve made a much better start than health care,” said Mark Meadows (R-N.C.), chairman of the Freedom Caucus.

Freedom Caucus members had wanted to see more tax details before voting on a budget resolution that will allow Republicans to pass a tax bill with only a simple majority in the Senate.

“President Trump has delivered a forward looking tax reform framework that will let hard working Americans keep more of their money, simplify our system, end carve outs for special interests, and will help make our businesses competitive abroad,” the group said.

The plan also won the backing of many outside conservative groups, some of which did not get fully on board with lawmakers’ ObamaCare repeal bills, as well as business groups.

“It’s definitely progress in the right direction,” said Brad Close, senior vice president of advocacy at the National Federation of Independent Business.

To be sure, the plan left many details — particularly about which tax breaks to eliminate — up to the congressional tax-writing committees.

“Yes, we have a lot of work ahead, but today marks a major step forward in that process,” House Ways and Means Committee Chairman Kevin Brady (R-Texas) said.

Lobbying is sure to increase as more details are made known, but the business community is supportive of the main parameters of the plan.

“There’s going to be a bananas amount of advocacy once legislative language is released, but [Republicans are] doing a good job of getting people to buy into the goal,” said Rohit Kumar, a former aide to Senate Majority Leader Mitch McConnell (R-Ky.) who now leads the tax policy practice at PwC.

Still, some trade groups have started pushing back against parts of the framework.

A coalition that includes state and local government groups and labor unions came out against the proposal’s likely repeal of the state and local tax deduction (SALT).

“This plan is a Washington money grab that takes away the most popular tax deduction from 44 million taxpayers in all 50 states, most of them middle class,” the coalition, Americans Against Double Taxation, said in a statement.

Repeal of the state and local deduction is also a problem for GOP lawmakers who represent high-tax states, such as New York and California.

“Any tax reform legislation must retain the state and local tax deductions,” Rep. Peter King (R-N.Y.) tweeted. “Hard working New Yorkers must not be taxed twice.”

Some business groups also expressed concerns about the framework’s plan to partially limit the deduction for corporations’ interest expenses.

“Interest deductibility is an essential component of businesses which rely on debt financing — companies of all sizes and across all sectors,” said Mike Sommers, president of the American Investment Council, which represents the private-equity industry.

To counter criticism that the plan will largely benefit the rich, the framework leaves the door open for a top individual rate above 35 percent “to ensure that the reformed tax code is at least as progressive as the existing tax code and does not shift the tax burden from high-income to lower- and middle-income taxpayers.” 

Still, top Democrats blasted the effort, arguing that it would provide a windfall to the wealthy and increase the deficit. In particular, they focused on the plan’s repeal of the estate tax, the increase in the bottom tax rate and the lower rate for pass-through businesses.

“This is wealth fare. Wealth fare, helping those of great wealth with more tax breaks,” said Senate Minority Leader Chuck Schumer (D-N.Y.).

Democrats also complained that they were not a part of the process of creating the tax framework. House Republicans met at a retreat at the National Defense University on Wednesday to discuss the plan, and Democrats had sought to be invited.

“This has been a partisan process from the start with virtually no Democratic input, as Republicans have put politics above policy and the economic security of hardworking Americans,” said House Ways and Means Committee ranking member Richard Neal (D-Mass.).

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An answer to Puerto Rico whining about Trump

The mayor of San Juan lashed out at Trump administration on Friday, decrying its relief effort in the wake of hurricanes Jose and Maria and saying if it doesn’t solve the logistics “what we we are going to see is something close to a genocide”.



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