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What’s next after the debt ceiling fight, a taxing problem for Taiwan, and some jabs over jabs on th͏‌  ͏‌  ͏‌  ͏‌  ͏‌  ͏‌ 
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June 2, 2023


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Steve Clemons
Steve Clemons

The Senate passed the debt ceiling deal with substantial bipartisan support last night after voting down a final set of amendments, including one by Senator Tim Kaine to block the Joe Manchin-backed Mountain Valley Pipeline. Now Congress has to figure out what it’s going to do next. Our team’s list of areas to watch includes China, permitting reform, rail safety, Ukraine aid, and AI.

Morgan Chalfant writes this morning that the Senate Foreign Relations Committee is trying to solve a problem for Taiwan: In the absence of a tax treaty, firms that operate there and in the U.S. are taxed by both governments. This discourages investment in the U.S. by top Taiwanese firms, which both sides are worried could undermine an initial trade agreement they signed Thursday.

About Joe Biden’s fall yesterday at the USAF Academy commencement: Obviously an incident like that triggers concerns about the physical stress Biden will be under when running again for the White House at age 80. But what was as important as the fall was how he got up and bounced back. I stupidly fell through a missing dock plank recently; I recently saw a friend trip, it’s just not unusual in and of itself. Even President Trump downplayed it by his standards, bringing up how he was mocked for carefully tiptoeing down a ramp. Joe Biden does have to deal upfront with the issue of whether his age can impact his judgment and competence, but sometimes a trip is just a trip.

For another take, Kadia Goba texted with Rep. Mondaire Jones, D-N.Y. about Biden’s stumble.

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☞ White House: President Biden’s aides spent yesterday afternoon trying to minimize the spill he took after tripping over a sandbag while on stage at the U.S. Air Force Academy commencement. “I got sandbagged,” Biden joked to reporters as he walked normally — and then did a little skip — on his way back into the White House last night. Biden is scheduled to deliver an Oval Office address this evening on the passage of the debt limit agreement.

☞ Senate: The bill to raise the debt limit passed in a 63-36 vote late last night after the Senate made quick work of a number of amendments, none of which got enough votes to pass. The upper chamber also approved a GOP-led resolution to block Biden’s controversial student debt relief plan; the White House has promised a veto.

☞ House: Oversight Chair James Comer, R-Ky. and the committee’s ranking member Jamie Raskin, D-Md. will visit FBI headquarters on Monday to view the internal document Comer subpoenaed for as part of his Biden investigation, which he’s claimed links the president to a criminal scheme, and receive a briefing from the bureau. Comer is threatening to hold FBI Director Christopher Wray in contempt over the document; Democrats on the committee say he’s trying to smear Biden with unverified claims.

☞ Outside the Beltway: Nevada Gov. Joe Lombardo vetoed a bill that would have criminalized fake electors, saying the penalties in the bill — between 4 and 10 years in prison — were “disproportionately harsh.” The veto came two days after Lombardo, a Republican, signed a separate bill making it a felony to harass or intimidate election workers.

Need to Know
Scott Olson/Getty Images

Donald Trump defended his administration’s work speeding up the development of COVID-19 vaccines after a voter in Iowa criticized his support for the “jabs.” “There’s a big portion of the country that thinks that was a great thing,” he said, while adding he opposed mandates. But the bigger news may have been the DeSantis campaign’s response: His staff attacked Trump for having “boasted” about the shots without warning about “adverse effects,” suggesting the candidate may lean into anti-vaccine sentiment as part of his attack on the former president’s COVID record.

National Security Advisor Jake Sullivan is expected to ask Russia to enter nuclear arms control talks without preconditions in a speech today, the Wall Street Journal reports. Russia stopped participating in the New START treaty, which expires in 2026, after the Ukraine invasion. One additional factor that could influence talks: Concern over China’s nuclear buildup.

Biden intends to pick Mandy Cohen, the former head of the North Carolina health department, to be the next director of the Centers for Disease Control and Prevention, the Washington Post reported. Cohen will take over from Rochelle Walensky, who is leaving the agency as it looks to turn a page from criticism of its pandemic response and messaging. Notably, Cohen served in the Obama administration and worked alongside current White House chief of staff Jeff Zients.

The U.S. imposed sanctions on two warring military factions in Sudan and companies connected to them, a day after Sudan’s army withdrew from peace talks taking place in Jeddah.

Morgan Chalfant

Beltway Newsletters

Punchbowl News: In order to secure quick passage of the debt ceiling deal through the Senate, Schumer assured a group of Republican defense hawks that additional defense spending — particularly for Ukraine — would be possible beyond the $886 billion cap specified in the bill.

The Early 202: Republican negotiators had originally sought $905 billion in defense spending, but the White House pushed back on the higher number because of domestic spending cuts in the deal.

Playbook: DeSantis is using his early state campaign swing to test out his arguments against Trump, including, among others, that he could serve two terms while Trump would be a lame duck, that he’s focused on execution while Trump isn’t, and that the former president  is “petty” and “juvenile.”

Axios: Plans to organize Republican primary debates are stalled over candidates’ concerns about potential hosts, raising the question of whether they’ll even happen at all. Trump’s team thinks his primary opponents need the events more than he does, and are wary of Fox News hosting one after the network’s positive coverage of DeSantis.

Semafor Staff

What’s next for Congress after the debt ceiling

REUTERS/Jonathan Ernst


The dust is settling from a debt limit fight that consumed Congress for several months and the vibes are…surprisingly good. Both President Biden and House Speaker Kevin McCarthy are getting positive headlines and the negotiators behind the debt ceiling deal have had nothing but nice things to say about each other, raising the prospect of bipartisan breakthroughs elsewhere.

“I think there is opportunity for goodwill,” Louisiana Rep. Garret Graves, a close McCarthy ally, told Semafor.

One looming clash: The debt limit bill pushes Congress to approve 12 separate appropriations bills — a legislative feat that hasn’t been accomplished since 1996 — by the end of the year or trigger a 1% across-the-board spending cut. Senate leaders Chuck Schumer and Mitch McConnell on late Thursday pledged to attempt to pass them.

But lawmakers also have a lengthy to-do list: There are must-pass bills, like the National Defense Authorization Act and Farm bill, which are each affected provisions of the debt ceiling agreement, as well as wish list items if the two parties can find common ground.

“I think both sides are happy if the temperature drops a little bit,” one Senate Democratic aide said. “The debt limit fight burned up a lot of oxygen for the first half of the year, but priorities that members wanted to get on in January might now have some room.”


Here are a few things we’ll be watching:

China. Majority Leader Chuck Schumer laid out plans last month for a broad China package that could include provisions to scrutinize U.S. investments in the country and add new investments in domestic tech and manufacturing on top of the CHIPS and Science Act. There’s also still interest in legislation that would enable the Biden administration to restrict or ban TikTok and other foreign technology platforms, headlined by a bipartisan Senate bill from Mark Warner, D-Va. and John Thune, R-S.D. that’s backed by the White House. The new House select committee on China, meanwhile, is driving much of the discussion about China policy on the House side.

Permitting reform. The debt ceiling deal included a handful of reforms meant to speed up the permitting process for infrastructure and energy projects, such as new rules that will slap a time limit on federal environmental reviews. But the bill left many of the most difficult issues around permitting untouched, and McCarthy promised to keep working with the White House on a larger, bipartisan bill. Republicans are still looking for reforms that will make it easier to build pipelines; Democratic climate hawks want to smooth the path for new transmission lines necessary for the deployment of renewable power. A grand bargain still seems conceivable.

Rail safety. Ohio Sen. J.D. Vance is still plugging away at the bipartisan rail safety bill he introduced in the wake of the East Palestine disaster earlier this year. In May, it passed the Senate Commerce Committee 16-to-11. But in a sign of trouble, it only picked up two Republican votes on the panel, suggesting that even if it can clear the upper chamber, the legislation may have trouble making it through the House. We’ll see if it takes some revisions to get more GOP members aboard.

Ukraine aid. Getting another Ukraine aid package through the House may be the next big test of the Biden-McCarthy relationship. In the Senate, defense hawks are already eyeing a potential Ukraine bill as an opportunity to boost overall Pentagon funding they say got shortchanged in the debt ceiling deal. The exact timing of the White House’s next request is unclear, but a recent Pentagon accounting error bought the administration some time. One potential boost: The right’s most influential critic of Ukraine aid is off the air.

Farm bill. Sen. Debbie Stabenow, chair of the Senate Agriculture panel, recently told reporters that she considered any further debate over SNAP work requirements “over” after the debt limit deal tightened the rules for older Americans. But House Agriculture Chair Glenn Thompson, her Republican counterpart, told Semafor he might push changes in response to the debt bill’s new exemptions for veterans.

A.I. OpenAI’s Sam Altman certainly got the attention of Congress with his recent appearances discussing new regulation. Schumer put out a framework for possible regulations earlier this year, while McCarthy is highly interested in the topic and working to educate his members. Sen. Mike Rounds, R-S.D. and Martin Heinrich, D-N.M. will lead the Senate’s bipartisan AI Caucus. The two say they’re still at the information gathering stage, but are looking for ways to spur innovation in the industry while reining in potential dangers. “There is the need to maintain the technological lead that we have in AI because our competitors are not going to slow down,” Rounds told Semafor.


Not everyone expects the goodwill to last long, particularly as the political calendar changes. “Honestly, we’ll see,” Rep. Byron Donalds, R-Fla. told Semafor. “I anticipate it could be short-lived since nothing divides this town like a presidential cycle.”

Foreign Influence

What Taiwan really wants on trade


Taiwan is already looking past an initial trade agreement signed with the U.S. on Thursday, hoping for further action on tariffs and double taxation that are deterring Taiwanese businesses from operating in the United States.

The issue of double taxation — which would be resolved outside of ongoing trade talks — has become especially acute as the U.S. looks to attract investments from semiconductor manufacturers, for which Taiwan is a hub. Without a formal tax treaty, businesses and individuals pay taxes to both governments.

Taiwan’s Representative to the U.S. Bi-khim Hsiao told reporters at a Christian Science Monitor breakfast earlier this week that Taiwanese companies “are paying a lot more taxes than other foreign investors here in the United States” and they find it “very problematic.”

But there’s not an easy fix, given that the U.S. and Taiwan don’t have official relations, and any sign of deepening ties between the U.S. and Taiwan would anger China.

Treasury Secretary Janet Yellen recently acknowledged it is a “very significant problem” for businesses and said the administration would work on a solution.

There are multiple tracks for a potential solution in Congress, where many members believe that a closer economic relationship between the U.S. and Taiwan would help mitigate China’s aggression toward the island. A bill introduced in May by Sens. Bob Menendez, D-N.J. and James Risch, R-Idaho, the leaders of the Senate Foreign Relations Committee, would pave the way for a tax agreement with Taiwan that relieves double taxation, and a separate group of House and Senate members has pledged to study the problem.

While the Foreign Relations panel is currently hashing out an agreement on a schedule to mark up bills, Menendez told Semafor on Thursday that the panel is “hopefully going to have a markup of it as soon as I get Senator Risch to agree.”

Morgan Chalfant

One Good Text

Mondaire Jones is a Democrat and a former congressman from New York.


Stories that are being largely ignored by either left-leaning or right-leaning outlets, according to data from our partners at Ground News.

WHAT THE LEFT ISN’T READING: Sen. Marco Rubio, R-Fla. wrote to the Department of Justice asking for an investigation into whether TikTok CEO Shou Zi Chew perjured himself in testimony before a House panel earlier this year.

WHAT THE RIGHT ISN’T READING: JPMorgan CEO Jamie Dimon suggested he’d consider a career in politics. “Obviously, it’s crossed my mind because people mention things to you and stuff like that,” he told Bloomberg TV.

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— Steve Clemons


Editor-at-large Steve Clemons

Washington Bureau Chief Benjy Sarlin

Washington Editor Jordan Weissmann

National Security Reporter/Lead Principals Writer Morgan Chalfant

Congress and Politics Reporter Kadia Goba

Domestic Policy and Politics Reporter Joseph Zeballos-Roig

2024 Campaign Reporter Shelby Talcott

Senior Politics Reporter David Weigel