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Thursday, May 4, 2023

The politics of priorities - BBC

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First Minister Humza Yousaf speaks during an anti-poverty summitPA Media
  • Humza Yousaf is not the only political leader asking some tricky questions and challenging his party's orthodoxies.
  • Tight public finances and his focus on poverty are forcing the new First Minister to question whether it is sustainable to keep offering tax-funded provision to everyone.
  • The axing of promised funds to universities and colleges is a sign of how sharp the departure from budget plans may become, with a mid-year budget statement set for later this month.

Squeezed government budgets are forcing some uncomfortable reviews of past commitments by politicians in power and those who aim to become so.

Sir Keir Starmer is on a journey away from abolishing Labour's commitment to remove student tuition fees in England.

He must surely be aware that a similar move, while in government, did immense damage to the Liberal Democrat party, from which it is yet to recover.

That extended to Scottish politics, where the U-turn didn't even apply. One lesson may be that it's best to ditch promises while in opposition, however tricky, because there's a very high price for ditching them while in government.

Conservatives have promises from their succession of prime ministers which have disappeared into the sand.

Remember the "once-and-for-all" solution to England's problems with social care, apparently removing the need for people to sell their homes to realise the funds necessary for residential care?

That hasn't aged well since Boris Johnson promised it. Indeed, it seems to have disappeared. And the more recent promise of a big expansion to childcare is still located somewhere over the horizon.

'Expensive group hug'

So Humza Yousaf is not alone in facing up to the challenge, and asking one big question about the way money is spent by government in Scotland.

This was posed in an interview with the Daily Record: Why should his daughter have her school meals provided at council expense when he, on the first minister's salary, could afford to pay for them?

This, we are now told, was not a way of reneging on the SNP manifesto promise to extend free school meals to the top end of primary school. His daughter is in secondary.

But it is a very sharp departure from SNP orthodoxy under the leadership of Alex Salmond and Nicola Sturgeon.

For nearly 16 years, the direction of travel was 'universalism' - free stuff for all, whatever your ability to contribute.

Secondary school children
Getty Images

It was a practical and popular expression of how Scotland could do things differently, with everyone included, as if in an expensive group hug. This was using the powers of devolution, while looking to so much more with the powers of independence.

The taxpayer would stump up for free eye and dental checks and for personal and nursing care for those in need of it (pre-dating the SNP in government), followed by tuition fees for students and free prescriptions.

Bridge tolls were abolished. And one of several reasons for the current ferries fiasco is that subsidising sea crossings to become equivalent to the same distance by road generated a lot more demand at taxpayer expense, not just from islanders but from vacationers with their camper vans.

The Scottish government felt able to freeze council tax and compensate councils for nine consecutive years. Those who saved most were those in the most valuable homes.

Once they had been handed powers over severe weather payments, Scottish ministers jettisoned temperature thresholds in favour of payments for all, whatever the weather.

College mergers

But that question about the teenage Yousaf's school dinners puts a question mark over all this.

If funds are needed for a priority such as tackling poverty, and if funds are constrained, then why not require more from those who can afford to contribute?

Shona Robison
PA Media

The new first minister is talking the politics of priorities, and he wants his top priority to be poverty reduction. Another word making significant appearances in Mr Yousaf's speeches referring to finance is that it must be 'sustainable'.

That is, making sure the promises made for the next year or two can be sustained for future years. The public spending watchdog, Audit Scotland, has issued repeated warnings about that, in the face of demographic pressure and the fast rising cost of healthcare. Perhaps it is now finding an answer.

An early indication of how the new cabinet is handling this came through the Scottish Funding Council, which allocates government money to universities and colleges.

There was no attempt to massage the figures, removing money through the back door. Some £46m pledged to the tertiary education sector, to help it with the transition to different teaching and learning methods and perhaps to ease the merger of institutions, was withdrawn. That was less than a month into the financial year.

It may serve as a warning to others - that even within a budget year, no-one can feel safe that promises and budget plans will be honoured. It will certainly serve as a warning to college and university principals about their place in Humza Yousaf's priorities. Their willingness to accept Scottish government constraints on student tuition income, in order to avoid fees, is looking fragile.

Treasury squeeze

We ought to learn more about priorities and sustainable finance later this month when then the new finance secretary, Shona Robison, presents the medium term financial strategy.

On some past occasions, that mid-year take on budgeting has said and done little to enlighten us. This time might be different, as the first big opportunity for new ministers to set out their revised priorities, reaching beyond the next Holyrood election, scheduled for 2026.

With a time horizon of five years, it faces some very tight squeezing of Westminster budgets and consequent tightening of the block grant to Holyrood.

Experience suggests that planned Treasury squeezes do not turn out as bad as first set out. But for now, that's what Humza Yousaf and Shona Robison have to contend with.

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Wednesday, May 3, 2023

Rep. Colin Allred launches Senate campaign against Ted Cruz - CNN

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Washington CNN  — 

Texas Democratic Rep. Colin Allred announced a run for US Senate on Wednesday morning, entering the race to challenge incumbent Republican Sen. Ted Cruz in 2024.

“We don’t have to be embarrassed by our senator. We can get a new one,” Allred said in his announcement video.

Allred is a former NFL player, worked in the Obama administration, and has represented Texas’ 32nd Congressional District since his first election in 2018, when he ousted GOP incumbent Rep. Pete Sessions. He won a pair of close races there before the seat became less competitive after the last round of redistricting.

Allred is also a prolific fundraiser, he ended 2022 with nearly $2 million in cash on hand, according to Federal Election Commission records. He’ll need those kinds of resources during his 2024 campaign, with Cruz’s campaign committee having a balance of $3.3 million in cash on hand at the end of 2022.

Cruz faced a stiff challenge from Democratic Rep. Beto O’Rourke during his 2018 reelection campaign, with Cruz ultimately winning by just under 3 points in the typically reliable red state. O’Rourke shattered fundraising records during the high-profile race, falling short in the end but galvanizing state Democrats in the process.

Cruz is seeking his third term in the Senate, having demurred on another presidential campaign after finishing second in the 2016 Republican presidential primary. While Texas law allows a candidate to run for Senate and president at the same time, in February, Cruz said “I’m running for reelection to the Senate” when asked if he would mount another bid at the White House.

“Democrats have once again turned to a far-left radical to run for Senate. Not only does Colin Allred vote with Nancy Pelosi 100% of the time, but his voting record is completely out-of-touch with Texas,’ a spokesperson for Cruz said in a statement following Allred’s announcement.

To take on Cruz, Allred will first have to prevail in a Democratic primary that could be competitive. State Sen. Roland Gutierrez, who represents the town of Uvalde, has also publicly expressed interest in a bid. And outgoing Houston Mayor Sylvester Turner, has also been mentioned as a possible candidate.

This story has been updated with additional reaction

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Exclusive: Special counsel probing Trump Organization's handling of Mar-a-Lago surveillance footage - CNN

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CNN  — 

Prosecutors for special counsel Jack Smith have been asking questions in recent weeks about the handling of surveillance footage from former President Donald Trump’s Mar-a-Lago resort after the Trump Organization received a subpoena last summer for the footage, according to multiple sources familiar with the investigation.

The handling of the footage, and how employees within the Trump Organization responded to the Justice Department’s demand for it, have prompted a new round of grand jury subpoenas to top Trump employees in the last few weeks, the sources told CNN.

Longtime Trump Organization executives Matthew Calamari Sr. and his son Matthew Calamari Jr. are expected to appear Thursday before the grand jury investigating possible mishandling of classified documents brought to Trump’s Mar-a-Lago home, sources said. Prosecutors are expected to ask them about the handling of the surveillance footage and Trump employees’ conversations following the subpoena, according to the sources.

Calamari Sr., the executive vice president and chief operating officer of the Trump Organization, has primarily overseen security operations for Trump and his properties during his decadeslong career working for Trump. His son, Calamari Jr., is director of security for the Trump Organization.

An attorney for Calamari Jr. declined to comment, as did a spokesman for the special counsel’s office. An attorney for Calamari Sr. did not respond to a request for comment.

The grand jury activity scheduled for Thursday marks another step forward for Smith’s investigation, as it secures some of Trump’s closest allies as witnesses potentially against him.

The footage has been a part of the Justice Department’s investigation into possible mishandling of classified records at the Florida beach club after Trump left the presidency and possible obstruction of justice. No charges have been brought in the case, and Trump has denied any wrongdoing.

CNN has previously reported the footage captured Walt Nauta, an aide close to the ex-president, Nauta and another Mar-a-Lago employee moving boxes containing documents out of a storage closet.

The Calamaris are among several witnesses expected to testify in Smith’s investigation on Thursday, sources said. Prosecutors have previously brought in lower-level Trump employees for questioning about the surveillance footage, including how it may have been handled in response to the subpoena for it and if it could have been tampered with, two sources told CNN this week.

Investigators also have previously asked about a text message from Nauta to Calamari Sr. and subsequent conversations about the surveillance footage, according to two of the sources. The Justice Department questioned Nauta months ago about the handling of the boxes, and he told the FBI about being directed by Trump, CNN previously reported.

A lawyer for Nauta declined to comment.

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The Politics of Migration Are Proving Intractable - Bloomberg

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The Politics of Migration Are Proving Intractable  Bloomberg

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5 ways a debt default could affect you - CNN

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CNN  — 

President Joe Biden and House Republicans may have as little as a month to prevent the US from defaulting on its debt, which would impact millions of Americans and unleash economic and fiscal chaos here and around the world.

Treasury Secretary Janet Yellen warned Monday that the government may not be able to pay all of its bills in full and on time as soon as June 1. However, the forecast was uncertain, and the default date might come several weeks later, she said. The US hit its $31.4 trillion debt ceiling in January, and Treasury has been using cash and “extraordinary measures” to satisfy obligations since then.

Just what would happen if the nation defaults on its debt is unknown since it’s never actually happened before. A close call in 2011 roiled the financial markets and prompted Standard & Poor’s to downgrade the US’ credit rating to AA+ from AAA.

Yellen gave a sense of the turmoil it would cause in her letter to House Speaker Kevin McCarthy on Monday.

“If Congress fails to increase the debt limit, it would cause severe hardship to American families, harm our global leadership position, and raise questions about our ability to defend our national security interests,” she wrote.

To be clear, a debt default doesn’t mean all payments would stop and people would permanently lose out on money they are owed. Treasury would have the funds to satisfy some obligations, but it’s not certain how the agency would handle the disbursements. Much would also depend on how long it takes Congress to address the borrowing cap.

“Tens of millions of people across the country who expect payments from the federal government may not get them on time,” said Shai Akabas, director of economic policy at the Bipartisan Policy Center.

Here are five ways that Americans could be affected by debt default:

Social Security payments

About 66 million retirees, disabled workers and others receive monthly Social Security benefits. The average payment for retired workers is $1,827 a month in 2023.

Almost two-thirds of beneficiaries rely on Social Security for half of their income, and for 40% of recipients, the payments constitute at least 90% of their income, according to the National Committee to Preserve Social Security and Medicare.

These payments could be delayed in a debt default scenario, though it’s possible Treasury could continue making on-time payments because of the entitlement program’s trust fund, Akabas said.

The benefits are disbursed four times a month, on the third day of the month and on three Wednesdays. Roughly $25 billion a week is sent out, according to the Congressional Budget Office.

“Even a short delay in the payment of Social Security benefits would be a burden for the millions of Americans who rely on their earned benefits to pay for out-of-pocket health care expenses, food, rent and utilities,” Max Richtman, the committee’s CEO, said in a statement.

Many other government payments could also be affected, including funding for food stamps; federal grants to states and municipalities for Medicaid, highways, education and other programs; and Medicare payments to hospitals, doctors and health insurance plans.

Federal employees and veterans benefits

More than 2 million federal civilian workers and around 1.4 million active-duty military members could see their paychecks delayed. Federal government contractors could also see a lag in payments, which could affect their ability to compensate their workers.

Also, certain veterans benefits, including disability payments and pensions for some low-income veterans and their surviving families, could be affected.

“Such calamity would place further stress on our servicemembers, retirees, and veterans, as well as their families, caregivers, and survivors,” Rene Campos, senior director of government relations for the Military Officers Association of America, said in a blog post. “Though life in uniform is not always predictable, those who serve or have served their country expect their country to honor their commitment to service.”

About $25 billion in pay or benefits for active-duty members of the military, civil service and military retirees, veterans and recipients of Supplemental Security Income is sent out on the first day of the month, according to the CBO.

Financial markets

Americans’ investments would take a direct hit. Case in point: Markets had what was then their worst week since the financial crisis during the 2011 debt ceiling standoff after the Standard & Poor’s downgrade.

Even if the debt ceiling impasse is resolved soon after a default, stocks could shed as much as a third of their value. That would wipe out around $12 trillion in household wealth, according to Moody’s Analytics.

Borrowing costs

If a default occurs, yields on US Treasuries will inevitably rise to compensate for the increased risk that bondholders won’t receive the money they’re owed from the government.

Since interest rates on loans, credit cards and mortgages are often based on Treasury yields, the cost of borrowing money and paying off debt would rise. That’s on top of the increased costs Americans are already facing from the Federal Reserve rate hikes.

Families and businesses would also have a tougher time getting approved for lines of credit since banks would have to be more selective about to whom they loan money. That’s because their costs of borrowing money will also rise, which limits the amount of money they can lend out.

The economy

A debt default could trigger an economic downturn, which would prompt a spike in unemployment. It would come at a particularly fragile time – when the nation is already dealing with rising interest rates and stubbornly high inflation.

How much damage would be done would depend on how long the crisis continues. If the default lasts for about a week, then close to 1 million jobs would be lost, including in the financial sector, which would be hard hit by the stock market declines. Also, the unemployment rate would jump to about 5% and the economy would contract by nearly half a percent, according to Moody’s.

But if the impasse dragged on for six weeks, then more than 7 million jobs would be lost, the unemployment rate would soar above 8% and the economy would decline by more than 4%, according to Moody’s. The effects would still be felt a decade from now.

“It would be a body blow to the economy, and it would be a manufactured crisis,” said Bernard Yaros, an economist at Moody’s.

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Tuesday, May 2, 2023

We showed people an AI political ad. Can they tell it's fake? - CNN

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We showed people an AI political ad. Can they tell it's fake?

A transformative and largely untested technology looks set to revolutionize political campaigning: artificial intelligence. AI blurs the lines between fact and fiction and is raising concerns ahead of the 2024 presidential election. Donie O'Sullivan reports.

03:32 - Source: CNN

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Monday, May 1, 2023

DeSantis-aligned board votes to sue Disney - CNN

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CNN  — 

The board overseeing Disney’s special taxing district – which was appointed by and is aligned with Florida Gov. Ron DeSantis – voted on Monday to sue the company days after the entertainment giant filed its own lawsuit against the board.

“Since Disney sued us – yes, we didn’t sue Disney, Disney sued us – we have no choice now but to respond,” said Martin Garcia, chairman of the Central Florida Tourism Oversight District board of supervisors. “Yes, we’ll seek justice in our own backyard.”

CNN has reached out to Disney for comment.

The dueling lawsuits follow 14 months of escalating tensions between the Florida governor and Disney over a state law that restricts the teaching of sexual orientation and gender identity in schools. The fight has intensified in recent months after the Republican leader moved to take over the company’s special taxing district and install a hand-picked board to oversee Disney’s vast holdings around Orlando. Before the board was selected in February, Disney had reached agreements with the outgoing board that limited the power of DeSantis’ appointees.

The new board voted last week to nullify those agreements, prompting Disney to sue DeSantis and the new board. In the lawsuit, Disney accuses DeSantis of weaponizing his political power to punish the company for exercising its free speech rights.

Garcia said the purpose of suing Disney is to “uphold and enforce” the board’s vote to void Disney’s pacts with the previous board.

The lawsuit will be filed in a Central Florida state court, Garcia said. Disney sued DeSantis and the board in federal court in the Northern District of Florida. The judge in the case, Mark Walker, is an appointee of former President Barack Obama, who has ruled against the state on several of DeSantis’ priorities.

In an interview over the weekend with the British newspaper The Telegraph, DeSantis accused Disney of “forum shopping” for a favorable judge.

The district, formerly known as the Reedy Creek Improvement District, was created in 1967. It essentially gave Disney control of the land where it planned to build its theme park empire, including providing services like sewage, fire rescue and road maintenance where no such government functions existed at the time. During the next six decades, Disney turned Central Florida swampland into one of the most-visited attractions in the world. That special arrangement, though criticized at times, was largely protected by state politicians as both Disney and Florida benefited from the tourism boom.

But Garcia said that times have changed and Disney is trying to block the state from taking action to wind down that arrangement.

“In essence, Disney is asking a federal court in Tallahassee to wrestle back the hands of time to 1967 while this board is instead charged legislatively, with bringing the district into the 21st century, with new and better policies and practices,” Garcia said.

This story has been updated with additional reporting.

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