What to Know in Washington: Congress Plans USMCA Labor Research

A bipartisan group of U.S. congressional staff plan to visit Mexican government officials to discuss labor reforms that Speaker Nancy Pelosi (D-Calif.) has said need to be implemented there to gain Democratic support for the U.S.-Mexico-Canada Agreement, President Donald Trump’s plan to replace the North American Free Trade Agreement.

Congressional aides involved in planning next week’s trip said it will help gather information about the recently passed Mexico labor reform legislation, as well as potential opposition that some fear could lead to a rollback of the changes this summer.

The Mexico City visit comes after Trump and Pelosi got into a heated exchange last week when an infrastructure meeting at the White House failed to yield results and the president afterward described the speaker as “a mess” and said his trade deal was too complicated for her to understand.

In what was seen as a positive development, Pelosi this month designated members of her caucus to be working group representatives that focus on issues that her caucus feels have to be addressed before a vote on the trade deal can take place. The working groups, which have yet to be set up, will be tasked with negotiating solutions to those issues with the Trump administration.

The Mexico mission will include aides from both the Senate and the House and aides who represent both Democratic and Republican lawmakers.

A senior congressional aide said it’s a way to show that Democrats are seriously engaged in this process and prepared to work with the Trump administration on getting to yes on the deal. The aide noted that despite last week’s rhetoric, Pelosi has not called off the staff trip to Mexico City, indicating her continued commitment to letting this process play out. Read more from Jenny Leonard and Nacha Cattan.

Photographer: Sarah Pabst/Bloomberg
Mexico’s former president Enrique Pena Nieto, U.S. President Donald Trump, and Canadian Prime Minister Justin Trudeau signed the United States-Mexico-Canada Agreement at the G-20 Leaders’ Summit in Buenos Aires, Argentina, on Nov. 30, 2018.

Also On Lawmaker’s Radars

BGOV Podcast: On this episode of “Suspending the Rules” from Bloomberg Government, budget and appropriations reporter Jack Fitzpatrick previews Congress’s remaining work on emergency and fiscal 2020 spending. Deputy news director Loren Duggan chimes in on how escalating tension between Trump and Pelosi could affect action on drug pricing, enactment of the new NAFTA, and other areas of potential bipartisan agreement.

Listen and subscribe to Suspending the Rules from your mobile device: Via Apple Podcasts | Via Overcast | Via Stitcher | Via Spotify

Disaster Aid Passage Blocked: Rep. Thomas Massie (R-Ky.) yesterday objected to unanimous consent approval in the House of a $19 billion disaster aid plan to help victims of storms across the country, marking the second delay by a Republican lawmaker since the Senate passed the measure last week. The House can pass the measure by a roll-call vote next week when lawmakers return from the Memorial Day recess. House Democrats will also try to pass the bill by unaminous consent on Thursday, when it meets for another pro forma session, House Majority Leader Steny Hoyer (D-Md.) said. Massie said the effort to block the bill is not organized, and had no details about a plan for Thursday.

“This is really ridiculous, frankly, what they’re doing,” Massie said of efforts to pass legislation by unanimous consent with lawmakers out of town. “And the more often we let them get by with this the more frequently they will do it.”

“The question is, those who feel strongly about passing the bill, why are they home on vacation and playing golf and doing fundraisers,” Massie said.

A measure to extend the National Flood Insurance Program for two weeks past its May 31 expiration date was also blocked yesterday by Massie. The program would lapse for a few days if the House doesn’t clear the separate extension or the disaster aid package — which carries a longer extension — until next week. Michael Smallberg has more on the short-term extension measure.

Cosmetics Companies Court Safety Standards: When independent testing found asbestos in makeup kits sold at Claire’s and Justice — stores marketed to tweens — the U.S. government couldn’t force the retailers to take the tainted products off the shelves. The FDA has limited power over the $60 billion cosmetics industry, so a voluntary recall was the only option.

On Capitol Hill, lawmakers are trying to give the FDA authority over products like lipstick, shampoo and lotion. Companies and consumer groups largely support the proposed oversight, though there’s disagreement about how much regulation there should be.

The industry’s main advocacy group, the Personal Care Products Council, has endorsed giving the FDA the power to force recalls when companies fail to take unsafe products off the shelves. It also wants any federal regulation to supersede state-level requirements. Read more from Megan R. Wilson.

McConnell Would Fill Open Court Seat: Senate Majority Leader Mitch McConnell (R-Ky.) said he’d allow Trump to fill a high court seat in 2020 if one opened up, CNN reports, citing remarks he made in Kentucky. The move would be a reversal from his earlier decision to deny former President Barack Obama the chance to fill a seat on the Supreme Court his final year in office.

McConnell declined to take up Obama’s final Supreme Court nomination, denying Merrick Garland a seat on the Supreme Court in 2016 and saying the presidential election winner should get the chance to pick a replacement for the late Antonin Scalia. McConnell’s blockade boosted Trump’s standing among conservatives as Trump had pledged to pick a conservative justice, which he did in Neil Gorsuch, who was ultimately confirmed in 2017.

Obamacare Oversight Effort: The White House and Justice Department haven’t produced any documents in response to a request from House Democrats for information related to their decision not to defend the constitutionality of the Affordable Care Act, a senior Democratic aide on the House Oversight Committee told Bloomberg Law. The deadline five House committee chairmen gave for the administration to begin producing documents was Monday. The HHS has already started to produce documents, as previously reported.

Lawmakers are likely to start issuing subpoenas once they return to Washington next week, as it is their next option for obtaining documents and testimony. Read more from Shira Stein.

Tax Extenders Draft: A preliminary draft of provisions for House legislation extending temporary tax breaks would renew the expired breaks through 2019 while tweaking the estate tax exemption, according to a document obtained by Bloomberg Tax. The draft document would let the estate tax exemption that went into effect after passage of the 2017 Republican tax law expire at the end of 2023 instead of at the end of 2025. The 2017 law expanded the exemption to $11.18 million per person, from $5.49 million. Read more from Kaustuv Basu.

Trump Financials Targeted by Democrats: Congressional Democrats told a Washington federal judge they want to examine Trump’s finances and revenue sources as they pursue their claim that he is being enriched by foreign governments without their consent, in violation of the U.S. Constitution. The disclosure came yesterday in a filing outlining how the Democrats and the Justice Department see the 2017 lawsuit playing out. Justice Department lawyers representing Trump told U.S. District Judge Emmet Sullivan they want the case put on hold, at least until he decides whether to let them appeal his refusal to throw out the lawsuit. Read more from Andrew Harris.

Meanwhile, the federal district judge who last week denied Trump’s request to block subpoenas to Deutsche Bank and Capital One for financial records put the case on hold while the president appeals his ruling. U.S. District Judge Edgardo Ramos on Monday signed off on part of an agreement that delays enforcement of the subpoenas while Trump and the House seek an expedited hearing at the federal appeals court in Manhattan. Read more from Bob Van Voris.

Politics & Elections

Sanders Faces Tough Road: New Hampshire helped make Sen. Bernie Sanders (I-Vt.) a force to be reckoned with in Democratic presidential politics. Now as his 2020 campaign rolls across the state, he’s facing fiercer competition and great expectations that could prove tough to fulfill. Sanders is counting on a repeat of his dominating victory in the 2016 New Hampshire primary to propel him through the rest of the contests leading to the party’s nomination to challenge Trump next year. Yet he’s running a distant second in most recent polls and facing a vastly bigger field of competitors, all of whom are staking a claim to be best equipped to defeat Trump – one of the main attributes voters are looking for. Read more from Laura Litvan.

Harris Unveils Abortion Plan: Sen. Kamala Harris (D-Calif.), a Democratic presidential candidate, wants states with a history of restricting abortion to seek Justice Department clearance before passing new laws curtailing access. The proposal would go further than plans presented by some of her rivals for the party’s nomination, as the passage of abortion bans in several states puts the issue at center stage in the campaign.

As part of her plan, Harris is joining several other Democratic candidates, including Sens. Elizabeth Warren (D-Mass.), Cory Booker (D-N.J.) and Kirsten Gillibrand (D-N.Y.), in calling for abortion rights to be set in federal law. Read more from Sahil Kapur.

Moulton’s Health Plan: Rep. Seth Moulton (D-Mass.), a former combat Marine who’s running for the Democratic presidential nomination, revealed he sought treatment for post-traumatic stress disorder as he proposed expanded mental health care for veterans and others. Moulton said in an interview with Politico that he first sought counseling in 2009, after serving in Iraq. Moulton’s campaign released his mental-health care plan, which would include routine mental health checkups for people serving in the armed forces as well as veterans; finance yearly mental health screenings for all American high school students; and “introduce mental health training (mindfulness, yoga) into the physical education curriculum of high schools.” Read more from John Harney.

Biden’s Education Plan: Joe Biden hopes to transform the U.S. education system by tripling federal funding for schools serving low-income students and offering universal pre-kindergarten for 3- and 4-year-olds. The education plan is the former vice president’s first detailed policy initiative as he seeks the Democratic presidential nomination. The proposal would also double the number of psychologists, guidance counselors, nurses and social workers in schools and include additional federal funding for improving public school buildings. Read more from Justin Sink.

Colorado Restores Voting Rights: Colorado parolees will gain the right to vote under a bill signed by Gov. Jared Polis (D) yesterday. The law, which takes effect July 1, declares that individuals serving a sentence of parole would be deemed to have completed their “full term of imprisonment,” and are therefore eligible to vote. Read more from Tripp Baltz.

Movers & Shakeups

Mulvaney’s Role at Labor Department: Trump‘s acting chief of staff, Mick Mulvaney, has seized power over the Labor Department’s rulemaking process out of frustration with the pace of deregulation under Labor Secretary Alexander Acosta, according to current and former department officials and other people who communicate with the administration.

Upon arriving at the West Wing in January, Mulvaney instituted a formalized system for settling regulatory policy and timeline disputes between White House assistants and Acosta’s top aides, said people with direct knowledge of the process. Conflicts are elevated to Mulvaney for a final decision, said one official with direct knowledge. Acosta and his staff have been losing these decisions so often that they’ve stopped bothering to appeal, said current and former DOL officials. Read more from Ben Penn.

Border Agency Expands Amid Surge: The already short-staffed U.S. Customs and Border Protection is creating a new job amid the migrant surge, to help get border patrol agents back to their law-enforcement duties. “Processing coordinators” could assist patrol agents, who are now spending as much as 40% of their time on administrative tasks, an agency official told reporters. Details including the number of new hires is yet to be determined, Michaela Ross reports.

Lynch to Law Firm: Loretta Lynch, the first black woman to serve as U.S. attorney general, is joining Paul, Weiss, Rifkind, Wharton & Garrison as a partner in its litigation department. Lynch will represent corporations, boards of directors, and individual clients in federal and state government investigations, criminal prosecutions, and bet-the-company enforcement actions and other investigations. Read more from Meghan Tribe.

Smithsonian Secretary Picked: Lonnie G. Bunch III, the founding director of the Smithsonian’s National Museum of African-American History and Culture, has been appointed secretary of the Smithsonian Institution, becoming the first African-American leader in its 173-year history, the Washington Post reported.

SCOTUS Wrap

Indiana Abortion Fetal-Burial Law: The U.S. Supreme Court’s strengthened conservative majority made its first move toward giving states more power to regulate abortion, as the justices upheld an Indiana law requiring clinics to bury or cremate fetal remains. The justices ruled yesterday that a federal appeals court was wrong to strike down the measure as unconstitutional. Only two justices — Ruth Bader Ginsburg and Sonia Sotomayor — indicated publicly that they disagreed with the ruling. The court ruled without hearing arguments in the case.

The three-page opinion, issued by the court as a whole, said the state has a legitimate interest in ensuring the proper disposal of fetal remains. The court said opponents never argued that the measure put an unconstitutional “undue burden” on a woman’s right to obtain an abortion. Read more from Greg Stohr.

Role of Courts in Social Security Benefits: Courts can review the Social Security Administration’s dismissal of an untimely benefits appeal, the court said. The justices yesterday reversed a lower court ruling finding that dismissal by the agency’s appeals council for an untimely filing wasn’t a “final order” subject to review by the courts. Appellate courts were split on the issue. Read more from Kimberly Strawbridge Robinson.

Cross-Border Shooting: The Supreme Court added to its already politically charged docket for next term by agreeing to hear a cross-border dispute involving the shooting death of a Mexican teenager by the U.S. Border Patrol. The justices will consider whether the family of Sergio Adrián Hernández Güereca, 15, can sue over his death in 2010. Read more from Kimberly Strawbridge Robinson.

Transgender Student Bathroom Policy: The court won’t take up the controversy over bathroom use by transgender students. The justices turned away a challenge by four students from Boyertown Area High School in Pennsylvania who claim a school policy of allowing LGBT students to use their preferred bathroom violates their right to privacy. Read more from Kimberly Strawbridge Robinson.

What Else to Know Today

Bolton Warns Iran Proxies: National Security Adviser John Bolton warned Iran’s proxies not to attack U.S. interests, saying any assault on their patron’s behalf would “risk a very strong response.” Bolton, in a briefing with reporters in Abu Dhabi today, said the U.S. is “very concerned” that the Iranian Revolutionary Guard Corps would use allied Shiite militia groups in Iraq to attack U.S. targets such as the American Embassy in Baghdad. Iran also has surrogates in Lebanon, Syria, Yemen and the Gaza Strip. “The point is to make it very clear to Iran and its surrogates that these kind of actions risk a very strong response from the Untied States,” he said. Read more from Zainab Fattah.

Kushner, Greenblatt to Mideast: Trump’s son-in-law and adviser Jared Kushner is traveling in the Mideast this week, together with U.S. special envoy for international negotiations Jason Greenblatt, a White House official said. The two officials, together with U.S. Special Representative for Iran Brian Hook, are traveling through Friday in Morocco, Jordan, and Israel, the official said, speaking anonymously due to the sensitivity of the matter. The following week Kushner will continue on to Montreux and London. In London he’ll join Trump for a state visit to the U.K., the official said. Read more from Alisa Odenheimer.

U.S. Spares China as Currency Manipulator: The Trump administration again refrained from labeling China a currency manipulator on Tuesday, a decision that leaves one of the president’s campaign promises unfulfilled but avoids further escalation in the trade war between the world’s two largest economies. The Treasury Department issued its semi-annual foreign-exchange report to Congress, expanding the number of countries it scrutinizes for currency manipulation to 21 from 12. Five countries — Ireland, Italy, Vietnam, Singapore and Malaysia — joined China, Japan, South Korea and Germany on a watch list for manipulation, while India and Switzerland were removed. Read more from Saleha Mohsin.

Meanwhile, China accused the U.S. of abusing a national security exception at the World Trade Organization by cutting off Huawei to American suppliers and warned the move could have grave consequences for the global trading system, Bryce Baschuk reports.

Trump Wins Fight Over Messaging Apps: Even if Trump White House personnel are using self-deleting message applications in violation of a records-preservation law, a Washington appeals court concluded that it lacks the authority to enforce day-to-day compliance. The trio of judges — all selected by Democratic presidents — yesterday unanimously upheld a 2018 trial court ruling rejecting a bid by Citizens for Responsibility and Ethics in Washington for an order compelling Trump and his staff to strictly comply with the 1978 Presidential Records Act. Read more from Andrew Harris.

With assistance from Jack Fitzpatrick

To contact the reporter on this story: Zachary Sherwood in Washington at zsherwood@bgov.com

To contact the editors responsible for this story: Giuseppe Macri at gmacri@bgov.com; Loren Duggan at lduggan@bgov.com