Welcome to FreedomWorks Foundation’s nineteenth regulatory review of 2019! Our Regulatory Action Center proudly updates you with our favorite tidbits from the swamp. We want to smash barriers between bureaucracy and the American people by delivering regulatory news straight to FreedomWorks activists. Check back in two weeks for the next edition.
1) Video of the Week: Unsurprisingly, the United States is not the first country to experience ballooning budgets and astronomical deficits. In the mid-1990’s, Canada’s debt grew to as high as 70% of GDP, similar to our current debt situation. In this weeks video, John Stossell sits down with Canadian economist David Henderson to discuss how Canada managed to tackle their debt problem by cutting government spending and reducing waste.
2) Why Is the CDC Still Fostering Potentially Deadly Confusion About Vaping and Lung Disease?: “Media outlets, following the lead of the U.S. Centers for Disease Control and Prevention (CDC), continue to blame recent cases of severe respiratory illnesses among vapers on "vaping" and "e-cigarettes" in general, falsely implying a link to legal nicotine products. This misinformation is fostering public confusion that may lead to more disease and death, both from smoking and from the black-market products that have been implicated in the lung disease cases.” https://reason.com/2019/09/24/why-is-the-cdc-still-fostering-potentially-deadly-confusion-about-vaping-and-lung-disease/
3) FBI using Facebook ads to gather Russian intelligence: report: “The FBI is reportedly using Facebook ads to gather intelligence on Russia, specifically targeting those who may be or know Russian spies. The FBI is running ads in the Washington, D.C., area, CNN reported on Wednesday, that direct to the FBI field office's website that describes its counterintelligence team and encourages visitors to meet "in person." https://thehill.com/policy/national-security/fbi/464069-fbi-using-facebook-ads-to-gather-russian-intelligence-report
4) Federal Court Upholds FCC Decision to Roll Back Obama-Era Net Neutrality Rules: “Today, by a 2-1 vote, the United States Court of Appeals for the District of Columbia Circuit sided largely with the FCC, upholding the primary regulatory rollback as a valid exercise of its authority. In the nearly 200 page opinion, which is heavy on technical detail, the court wrote that while the challengers raised "numerous objections" aiming to show that the FCC's reclassification is "unreasonable," the judges found them "unconvincing." https://reason.com/2019/10/01/federal-court-upholds-fcc-decision-to-roll-back-obama-era-net-neutrality-rules/
5) Trump to issue executive order ‘protecting’ Americans from ‘Medicare for All’ campaign proposals pushed by Democrats: “The executive order, which he is scheduled to discuss at a speech in Florida later Thursday, is intended to bolster Medicare Advantage, private Medicare insurance for seniors that currently covers 22 million people, senior administration officials said on a call with reporters. The plan would also offer more affordable plan options, increase use of telehealth services and bring payments in Medicare fee-for-service program in line with payments for Medicare Advantage, officials said.” https://www.cnbc.com/2019/10/03/trump-to-issue-executive-order-protecting-americans-from-medicare-for-all.html
6) Treasury to create tool to help people redeem billions in unclaimed savings bonds: “Sen. John Kennedy (R-La.) on Wednesday said that the Treasury Department will create an online tool to help people redeem billions of dollars in savings bonds. About $26 billion in matured savings bonds are in the U.S. Treasury and have yet to be redeemed. Using the department's forthcoming tool, people will be able to verify against Treasury Department records if they have any savings bonds dated after 1974 that can be redeemed, Kennedy's office said in a news release.” https://thehill.com/policy/finance/464057-senator-treasury-will-create-tool-to-help-people-redeem-billions-of-dollars-in
7) Trump takes heat from right over vaping crackdown: “The Trump administration is under fire from conservative groups and some GOP lawmakers, who are pushing back over its planned crackdown on e-cigarette flavors. They say the administration is overreaching, and the flavor ban will harm small businesses, a violation of core Republican free market principles.” https://thehill.com/policy/healthcare/464470-trump-takes-heat-from-right-over-vaping-crackdown
The bank CEOs sat meekly during Waters' verbal flogging. But as she frothed at the mouth, House Financial Services Committee Chairman Barney Frank covered the microphone and briefly chastised her. To no avail. Waters' motor mouth kept on running.
Did the banks raise interest rates on credit card customers after they took Troubled Asset Relief Program (TARP) money, she thundered. Thumping her fists on the table, she then railed about their loan modification policies. "How many require that you have to be behind by two months?" Blustering about underwriting fees they paid themselves on government-backed bond sales, she yelled, "You made money off the TARP money!" One of her fellow Democrats finally ended the diatribe: "I'm going to have to calm you down because when the chairman gets back he's going to have to penalize me."
Fast-forward a month later. The Wall Street Journal reported Thursday that the high-and-mighty Waters had a personal and financial stake in Boston-based OneUnited, a minority bank that received $12 million in TARP money under smelly circumstances. The banks' executives donated $12,500 to her congressional campaigns. Her husband, Sidney Williams, was an investor in one of the banks that merged into OneUnited. They've profited handsomely from their relationship with the bank:
"Congressional financial-disclosure forms show Ms. Waters acquired OneUnited stock worth between $250,000 and $500,000 in March 2004, as did Mr. Williams. Mr. Williams joined the board of OneUnited that year.
"Each sold shares in September 2004 -- including Ms. Waters' entire stake -- but Mr. Williams continued to hold varying amount of the company's stock. In the lawmaker's most recent financial-disclosure form, dated May 2008 and covering the prior year, Ms. Waters reported that her husband held between $250,000 and $500,000 worth of the bank's stock.
"Mr. Williams also received interest payments from a separate holding at the bank, also worth between $250,000 and $500,000. The 2008 form doesn't specify what that is. Mr. Williams stepped down from the bank's board last spring. It couldn't be learned whether he still owns stock in the bank. Mr. Williams didn't return calls seeking comment."
Waters (along with Frank) participated directly in pressuring the feds for OneUnited's piece of the bailout pie. She personally contacted the Treasury Department last December requesting $50 million for the company -- and failed to disclose her ties to the bank to them. The government ended up coughing up $12 million in TARP funding for OneUnited -- despite another government agency rapping the bank in October 2008 for "operating without effective underwriting standards and practices," "operating without an effective loan documentation program" and "engaging in speculative investment practices."
Oh, and get this: The favored bank of Maxine Waters was also penalized for alleged excessive executive compensation. The FDIC ordered the bank to "sell all bank-owned automobiles," require reimbursement for executives' car purchases (according to the Boston Business Journal, OneUnited CEO Kevin Cohee was cruising around in a 2008 Porsche SUV), and cease payments on a $6 million Santa Monica beachfront home purchased by Cohee, his wife, Teri Williams, who served as bank president, and others.
Responding to scrutiny of the bank's special treatment, Cohee is now accusing critics of -- yep, you guessed it -- racism.
Now, who is sick of Democratic shakedown artists sanctimoniously lecturing others about the culture of corruption? Raise your hand! Raise your hand!
The US and China have seen trade tensions rise rapidly in recent days, casting uncertainty on whether the world's largest economies would be able to stave off planned tariff escalations set to take place next week.
On Thursday and Friday, the two sides are set to hold the first high-level trade discussions on US soil since they fell apart in May. But a series of escalations have unfolded ahead of the thirteenth round of negotiations, which were expected to offer a last-ditch attempt to avoid tariff rates as high as 30% after October 15.
The US added 28 technology companies in China to an export blacklist late Monday over alleged human rights abuses in the Xinjiang region. Chinese Foreign Ministry spokesman Geng Shuang was swift to push back against the action and suggest retaliation.
"We urge the US to immediately correct its mistake, withdraw the relevant decision and stop interfering in China's internal affairs," Geng said at a press conference. "China will continue to take firm and forceful measures to resolutely safeguard national sovereignty, security and development interests."
The Trump administration has also moved forward with discussions on ways to limit investment flows into China, according to a source familiar with the matter. Bloomberg first reported the plan, which was disputed by the White House and the Treasury Department but has been confirmed by several news outlets including Business Insider.
"The chances of these talks yielding any sort of deal was already amazingly small," said Scott Kennedy, a senior adviser at the Center for Strategic and International Studies who studies China. "This possible step just adds to the growing pile of reasons why the Chinese have little incentive to make substantial concessions."
President Donald Trump has publicly vacillated between the prospect of a prolonged dispute with China and optimism toward a deal. Against the backdrop of a rapidly-evolving impeachment inquiry that was opened last month, the president could face increasing pressure to scale back tariffs that could alter the calculus of his reelection bid.
"China is also coming here on — their representatives — they're coming on Thursday and Friday," Trump told reporters Monday in the Roosevelt Room. "As to whether or not we make a deal, I don't know. But there's certainly a good possibility."
China has increased American agricultural purchases ahead of this week's meetings between Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin and a Chinese delegation led by Vice Premier Liu He in Washington. Soybeans have been at the center of trade negotiations since China halted imports of them last year.
But the Trump administration has struggled to win concrete concessions from China on issues that ignited the trade dispute more than a year ago, including intellectual property theft and the forced transfer of foreign technology. The two sides will continue to discuss those topics this week, according to a statement from the White House, along with services, non-tariff barriers, agriculture, and enforcement.
"There is no chance of a comprehensive deal, but there hasn't been any chance since May," said Derek Scissors, a China scholar at the right-leaning American Enterprise Institute.