Four Quick Themes as We Await Mueller
Author: Greg Valliere
July 24, 2019
WASHINGTON IS GRIPPED WITH MUELLER FEVER this morning, even though today’s hearings probably won’t change much. As we await Robert Mueller’s testimony, here are four themes worth watching:
1. THE SPENDING PIG-OUT: The push-back is intense from The Wall Street Journal, House conservatives and other deficit hawks, who are horrified by the budget deal, which abandoned any pretense of fiscal discipline and gave Nancy Pelosi huge domestic spending increases, even more than hikes won by the Pentagon. Despite the extremely vocal criticism, this deal should pass narrowly in the House later this week and easily in the Senate next week.
2. EVERYONE HATES BIG TECH except, of course, investors who have made billions of dollars betting on one of the most successful industries in American history. But the industry has potent enemies: Donald Trump, who sees a conspiracy to thwart him and his allies, and Democrats like Elizabeth Warren who see too much concentration and privacy abuses. The industry faces prolonged headline risk, but meaningful penalties from antitrust agencies are years away — and in the meantime campaign contributions from Silicon Valley will soar.
3. ANGRY BASE THREATENS TO OUST DEMOCRATS: Just as the Republican base has ousted GOP lawmakers who haven’t been conservative enough, here come left wing activists, threatening primary challenges against Democrats who aren’t aggressive enough against Trump. This trend started last year, when Alexandria Ocasio Cortez stunned veteran Democrat Joe Crowley, and now the list of potential targets includes some big names: Reps. Jerrold Nadler, Richard Neal, Eliot Engel, William Clay, and Massachusetts Sen. Ed Markey all face primary challenges.
MOST OF THESE INCUMBENTS have raised plenty of money and won’t be caught off-guard, like Crowley. But the message is clear in liberal states: Democrats who appear too soft on Trump need to watch their backs; the left wants to oust the Old Guard.
4. A SHIFT IN THINKING ON IRAN: The isolationist Trump has an aversion to military action; he prefers to rely on bombast, threatening action that never seems to come. But we’re hearing that John Bolton and other hawks have convinced Trump that Iranian provocations in the Strait of Hormuz have to be confronted.
THE PENTAGON HAS IDENTIFIED military targets in southern Iran, and U.S. air strikes are increasingly likely if the Iranians continue to target shipping in the region. Trump blinked a month ago, but it’s unlikely that he will blink again. A joint attack by the U.S. and the U.K. would send a signal that Trump and Boris Johnson are on the same page when it comes to confronting the ayatollahs.
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