June kicked off with one of the most dramatic and news-packed weeks in recent memory, with significant stories flying in from all angles. For Americans, the continued unfolding of the Trump/Russia story featuring dramatic testimony from former FBI Director James Comey and the current chiefs of several intelligence agencies took central stage.
But congressional Republicans also continued to make progress on their sweeping legislative agenda, while a major international crisis erupted in the Persian Gulf and the circumstances for a stealthy financial crisis continued to brew behind the scenes in Washington.
Here’s what you need to know.
James Comey testified before Congress
Easily the political event of the week, Comey’s testimony served to keep the Trump/Russia story firmly dominating the media cycle. While it provided relatively little in the way of genuinely new information, Comey repeatedly attacked Trump’s honesty and declared that the president “chose to defame” him and the FBI.
Comey also confirmed, under oath, many parts of the scandal that had previously been available only in the form of investigative articles featuring unnamed sources.
- Comey’s damning details: By Comey’s account, from day one Trump showed little respect for the independence of the FBI or the Justice Department from political interference. And he sought to improperly influence the ongoing criminal investigation into former National Security Adviser Michael Flynn.
- Republican counterspin: One major GOP line of response has been to go negative on Comey, with the White House even flatly accusing him of lying. Several Senate Republicans noted that Comey had earlier come in for ample criticism from Democrats for his handling of the scandal over Hillary Clinton’s private email server. Their firmer argument is that for all the swirl of allegations there is, as of yet, no evidence that Trump was personally involved in any improper Russian contacts.
- The obstruction of justice questions: We surveyed legal experts on whether Trump’s Flynn intervention amounted to obstruction of justice and they disagreed amongst themselves. But most agreed that there was at least some reason to believe Trump had committed a crime, though several cautioned that sitting presidents were basically immune from criminal prosecution.
The Tories shot themselves in the foot in the UK
British Prime Minister Theresa May, who took office in the wake of David Cameron’s resignation following the passage of the Brexit referendum, scored a parliamentary majority in her own right with a win in the United Kingdom’s general election. The result, however, was so much closer than had been predicted that some in May’s own party are calling for her resignation
- May lost by winning: The key fact is May chose to call an early election because she expected a landslide win due to internal chaos within the opposition Labour Party. Instead, Labour’s controversial left-wing leader Jeremy Corbyn was able to produce a campaign manifesto that drew widespread support. He then put together his first sustained run of solid on-message work free of intra-party controversy. May, meanwhile, proved to be an awkward campaigner, while her Tories advanced a number of unpopular spending cuts.
- What’s next: May’s weak showing is an embarrassment, but a win is a win, and her party will keep governing for now. But May personally looks to be discredited, and is all but certain to face challenges to her leadership from inside her own party — with former London Mayor and current British Foreign Minister Boris Johnson a likely challenger. For Labour, the unexpectedly strong result will confirm Corbyn’s leadership and allow him to consolidate the party behind his new-socialist vision.
Qatar’s neighbors initiated a blockade
The small but very wealthy Persian Gulf monarchy of Qatar found itself hit by a surprise trade, airspace, and diplomatic blockade initiated by a group of America’s leading Arab allies, with Saudi Arabia, the United Arab Emirates, and Egypt leading the pack. Qatar is highly dependent on land shipments from Saudi Arabia and access to the UAE’s ports, so its economy is now under severe strain.
- Why it matters: Qatar is also a key US ally, with its Al Udeid Air Base serving as one of the most important American military facilities anywhere in the world. Thousands of American troops are stationed there, and it serves as the forward operating headquarters of US Central Command (the formal HQ is in Tampa, Florida) — which oversees the war in Afghanistan and the campaign against ISIS in both Iraq and Syria.
- What it’s about: Qatar has long pursued a promiscuous diplomatic approach, involving unusual closeness to both the United States and Islamist groups like the Muslim Brotherhood that other American allies regard as terrorists. The Qatari government supports those extremist groups for both ideological reasons and to keep their country out of the crosshairs. It’s relationship with Washington is also transactional: Qatar believes housing the Al Udeid base means the US will keep the country safe from Saudi Arabia.
- What the United States is doing: American military and diplomatic officials are trying to reduce tensions, calm the situation, and ideally broker a compromise. But Trump personally on Twitter has been taking a more clearly pro-Saudi line, consistent with the approach he’s taken since his recent trip to Riyadh. That threatens to make Qatar directly blame the US for the current crisis, possibly threatening the future of the base.
The Senate moved closer to Obamacare repeal
Senate Republicans have been deliberately advancing their health care efforts in a stealthy manner, preferring behind-closed-doors negotiations within the caucus to any kind of public hearings or deliberation. But while the media’s eyes were on Comey, Senate Republicans seem to have come close to a consensus approach that can get 50 votes.
- The basics: The idea is to replicate the fundamental structure of the House’s Obamacare repeal bill — cutting taxes and reducing regulations while paying for it with Medicaid cuts and reduced subsidies. But the Senate wants to essentially do a bit less of everything — less deregulation, slower and perhaps gentler Medicaid cuts, and smaller reductions in subsidies.
- Why it matters: First and foremost, the fate of health insurance for millions of Americans is in the balance, along with hundreds of billions of dollars’ worth of tax cuts — mostly but not exclusively for high-income families.
- What’s next: Unlike their House colleagues, Senate Republicans can’t vote on a bill without an official evaluation from the Congressional Budget Office. So even if they reach broad agreement on legislative text, there will still be a period of waiting for the CBO score and potentially a backlash to whatever they conclude.
The debt ceiling draws near
The Treasury Department is calling on Congress to raise the statutory debt ceiling before leaving town for the August recess, but Democrats and Republicans on Capitol Hill are drifting further apart, not closer together.
- The conservative line: Consistent with the position they’ve taken since 2011, conservative Republicans — especially in the House of Representatives — are arguing that Congress should authorize additional borrowing only in the context of a package of spending cuts that will reduce the long-term need for borrowing.
- The progressive line: Democratic leaders are staking out the exact opposite position, that it’s absurd to authorize additional borrowing while Republicans are talking about passing a $5 trillion deficit-financed tax cut, slanted mostly to high-income families.
- Why now? Quarterly tax payments arrived in June and came in far lower than the Treasury had anticipated. Observers aren’t sure why, but most experts think that businesses and affluent individuals are deliberately delaying receipt of income because they anticipate tax cuts will pass and rates will be lower in 2018. Another chunk of revenue should arrive in mid-September, but the Treasury is no longer as confident as they once thought that it will be enough to keep the lights on through November.
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