First Take: Sept. 22, 2024

— Headlines of note:

• CR with Dec. 20 expiration. The U.S. Secret Service would get extra money ($231 million) to protect presidential candidates after a second assassination attempt on former President Donald Trump. The new House bill keeps other gov’t spending at current levels for three months. The new bill also replenishes the Federal Emergency Management Agency’s disaster relief fund but doesn’t include $10 billion in disaster aid attached to the earlier stopgap bill. The bill excludes a previous GOP proposal that would have required people to have proof of citizenship to register to vote, something that was included in the failed bill last week. The 46-page bill will likely be voted on by the House by Wednesday. Then it moves to the Senate. “While this is not the solution any of us prefer, it is the most prudent path forward under the present circumstances,” House Speaker Mike Johnson said in a letter Sunday afternoon. Johnson likely will have to rely on a bipartisan vote in the House, as some Republicans are expected to object that there aren’t funding cuts.

• Liz Cheney suggests a new political party may be needed (link), saying Donald Trump has captured the traditional Republican party.

• Treasury Secretary Janet Yellen pens commentary in WSJ saying Biden/Harris administration has helped America through hard times (link).

• Israel and Hezbollah trade strikes and threats.

• Commentary from Richard Crow, grain trader and analyst: “Western part of Oklahoma and Kansas has received good rain over the last week. Wheat seeding should progress. In a research report Friday, S&P Global projected the U.S. winter wheat seeding to decline by around a million acres. HRW was down 650,000 acres and SRW down 250,000 acres.”

— We took a behind-the-scenes look at new farm bill issues in a special report. Link.

— Declining interest in new farm bill, but lots of interest in 45Z program. AgriTalk on Friday got an email response from a listener that said rather than talk about a new farm bill, focus should be on getting guidance for the 45Z biofuel tax credit program. Link to program. Monday’s Updates will provide an in depth look at why it is taking so long to get additional information about the tax credit program that starts Jan. 1.

— September manufacturing surveys could signal factory sector recovery. Although economic data this week will not show the impact of the recent 50-basis-point rate cut by the FOMC, attention will be on manufacturing surveys. The New York and Philadelphia Fed surveys for September both saw positive turnarounds in business conditions after months of contraction. However, the Richmond and Kansas City Fed manufacturing indexes, which better correlate with the national ISM Manufacturing Index, are key indicators to watch. If they show improvement, it could signal a brighter outlook for the factory sector and suggest the recession in manufacturing may be nearing its end.

— Trump indicates he may not run in 2028 if defeated by Harris. Former President Donald Trump suggested he is unlikely to pursue another presidential campaign if he loses to Vice President Kamala Harris in the Nov. 5 election. Trump, now 78 years old, made this statement during an interview on the television program Full Measure that aired Sunday.

“I think that ... that will be it,” Trump told host Sherryl Atkinson when asked if he’d run again in 2028 if he loses to Vice President Kamala Harris in the presidential election. He added, “I don’t see that at all,” regarding the possibility of launching another presidential bid.

Trump would be 82 years old on Election Day in 2028.

— Trump to outline ‘plan to lower taxes’ in Sept. 24 speech in Savannah. Former President Donald Trump will deliver remarks on Tuesday outlining his plan to lower taxes for American business owners and highlight the importance of buying American-made goods, his campaign says in a statement.

Trump now wants to alter the state and local tax (SALT) deduction, which his 2017 tax reform capped at $10,000 per household. Trump vowed at a rally on Long Island this past week to restore the deduction and save “thousands of dollars for residents of New York, Pennsylvania, New Jersey and other high-cost states.”

Tax cut offset. Republicans limited the SALT deduction in part to pay for a larger standard deduction and lower marginal tax rates. This benefited all Americans. But state and local taxes are set to become fully deductible again in 2026, which is also when most of the 2017 individual tax-code changes expire.

Without the $1.2 trillion in budget savings from extending the SALT cap, Trump will have to alter if not scrap other parts of his reform. This could include the 37% top marginal rate, 20% small business deduction and higher estate and gift tax exemptions. Extending those three items would cost about $1.2 trillion combined over a decade.

Trump now has floated a general tax exemption for overtime pay. The Tax Foundation estimates this carve-out would cost between $680 billion and $3.1 trillion over a decade depending on its structure (depending on if the exemption applies to the payroll tax as well as the income tax). Analysts say the exemption would create the kind of economic distortion that Trump’s tax reform aimed to eliminate.

The same is true of Trump’s proposal not to tax Social Security benefits, which would cost between $1.6 trillion and $1.8 trillion over 10 years.

Trump has also pitched a tax exemption for tips.

Concludes the WSJ in an editorial: “Trump won’t beat Ms. Harris in a vote-buying contest, and he may lose Americans who are leaning toward him because of his first-term economic success.”

— Vice President Kamala Harris is set to introduce additional economic policy proposals this week as the 2024 presidential race enters its final stretch, according to Reuters (link). While details remain undisclosed, the proposals are expected to address wealth creation and America’s competitiveness.

— On Wednesday, the OECD releases its Interim Economic Outlook report. Most observers will focus on any updated forecasts for the U.S., China and EU economies, and the reasons for any changes. Link for info.

— Jill Biden did not actually lead the Cabinet meeting at the White House this past week. While she did participate and speak at the meeting, her involvement has been mischaracterized or exaggerated in some reports, say Biden administration sources. What occurred:

• This was President Joe Biden’s first Cabinet meeting since October 2, 2023.
• Jill Biden attended the meeting as a guest to speak about a specific initiative - the White House Initiative on Women’s Health Research.
• President Biden introduced his wife and explained her presence, saying it was the first time she had joined a Cabinet meeting. After a brief introduction by the president, Jill Biden spoke for about 4.5 minutes about maternal health initiatives.
• President Biden convened and led the Cabinet meeting as usual. He opened the meeting by discussing the need for Congress to pass a short-term funding bill.
Biden then introduced his wife and handed the floor to her to speak about the women’s health initiative.
• After Jill Biden’s remarks, the president continued with the meeting, including answering questions on foreign policy issues.
• Some political commentators and opponents criticized Jill Biden’s presence and participation, suggesting it was inappropriate or indicative of the president’s fitness for office. The White House defended her participation, stating it was to showcase important work on women’s health research.

— This week in Congress. Here is a link to the details regarding what lawmakers may do and key reports and other events for the week.

Key ag-related events include:

Monday, Sept. 23
• National Association of State Departments of Agriculture annual meeting, through Wednesday, Indianapolis.
• Global energy markets. Council on Foreign Relations discussion on the current state of global energy markets.

Tuesday, Sept. 24
• Clinton Foundation meeting/Vilsack. Final day of the Clinton Foundation annual Clinton Global Initiative Meeting; USDA Secretary Tom Vilsack participates in a session on “Food as A Tool to Empower Communities and Drive Climate Smart Solutions.”
• Women in Agribusiness Summit, through Thursday, Denver.
• Climate and agriculture risks. Reuters Newsmaker discussion on “ways banks can integrate climate change into risk management frameworks, better improve regulation and standardization of climate-related exposures and protect high-risk portfolios such as property and agriculture.”
• Climate change and food security. Council on Foreign Relations discussion on “Accelerating Solutions at the Intersection of Climate Change and Food Security.”
• China WTO compliance. Office of the U.S. Trade Representative hearing on China’s compliance with its World Trade Organization commitments.
• Nutrition program reforms. House Ways and Means Committee hearing on “Reforming Temporary Assistance for Needy Families (TANF): States’ Misuse of Welfare Funds Leaves Poor Families Behind.”
• Rural disability. Urban Institute virtual forum on “Elevating Rural Disability Data for Policy Impact.”

Wednesday, Sept. 25
• Dietary Guidelines Advisory Committee meeting, through Thursday.
• USDA report: Food Price Outlook

Thursday, Sept. 26
• Dietary Guidelines Committee. Health and Human Services Department virtual meeting of the 2025 Dietary Guidelines Advisory Committee to provide subcommittee updates, including presentations by each subcommittee and deliberation by the full committee regarding progress made since the fifth public meeting, including evidence review and synthesis, draft conclusion statements, draft scientific report and plans for future Committee work.
• Trump tariff, deportation and Fed plans. Peterson Institute for International Economics virtual discussion on “The Economic Effects of Trump’s Plans for tariffs, Deportations, and the Fed.”
• PFAS exposure. Senate Environment and Public Works Chemical Safety, Waste Management, Environmental Justice, and Regulatory Oversight Subcommittee hearing on “Examining the Public Health Impacts of PFAS (per- and polyfluoroalkyl substances) Exposures.”

Friday, Sept. 27
• Climate, water issues. Final day of the Environmental Protection Agency meeting of the Local Government Advisory Committee to discuss climate communication, environmental justice, the EPA’s efforts to address cumulative impacts, and water system restructuring.