Republicans Release Tax Plan, Cutting Corporate and Middle-Class Taxes – New York Times

WASHINGTON — Republican lawmakers unveiled the most sweeping rewrite of the tax code in decades, outlining a $1.51 trillion plan to cut taxes for corporations, reduce them for some middle-class families and tilt the United States closer, but not entirely, toward the kind of tax system long championed by businesses, according to talking points circulated on Thursday.

The House plan, released after weeks of internal debate, conflict and delay, is far from final and will ignite a legislative and lobbying fight as Democrats, business groups and other special interests tear into the text ahead of a Republican sprint to get the legislation passed and to President Trump’s desk by Christmas.

Representative Kevin Brady, who chairs the House Ways and Means Committee, said the bill is estimated to cost $1.51 trillion over a decade. Lawmakers must keep the cost of the bill to $1.5 trillion if they want to pass it along party lines and avoid a fillibuster by Democrats. Lawmakers have been scrambling for days to find a way to make cuts that are expected to cost trillions of dollars into a $1.5 trillion hole. That has prompted a host of changes on the corporate and individual side, including a new twist that would limit the mortgage interest deduction by capping it at $500,000.

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“This isn’t the last product,” said Representative Carlos Curbelo, Republican of Florida and a member of the House Ways and Means Committee. “This is just the kickoff to this tax reform exercise.”

Individual tax rates will change

The plan establishes three tax brackets, 12, 25 and 35 percent, and also keeps a top rate of 39.6 percent for the highest-earners, collapsing the total number of brackets from seven. The brackets, as described by Representative Kevin Brady, chairman of the Ways and Means Committee and Republican of Texas, fall along the following lines:

Single filers making up to $24,000 will pay no income tax; up to $90,000 will be in the 12 percent bracket, up to $260,000 in the 25 percent bracket and up to $1 million in the 35 percent bracket. Those making above $1 million will be in the 39.6 percent bracket, which is currently the top rate for millionaires.

Changes for the middle class

The proposal roughly doubles the standard deduction for middle-class families, expanding it to $24,000 for married couples, from $12,700, and setting it at $12,000 for individuals, from $6,530 today. Republicans also plan to expand the child tax credit to $1,600 from $1,000 and add a $300 credit for each parent and nonchild dependent, such as older family members.

No changes to 401(k) retirement plans

After much nail-biting debate, the House will not make any changes to the pretax treatment of 401(k) plans. “Americans will be able to continuing making both traditional, pretax contributions and ‘Roth’ contributions in the way that works best for them,” the talking points say.

Changing the mortgage interest deduction

One of the biggest flash points will be proposed changes to the popular mortgage interest deduction. Under the Republican plan, existing homeowners can keep the deduction, but future purchases will be capped at $500,000.

The National Association of Realtors came out swinging against the bill, suggesting a huge fight awaits over how real estate is treated.

“Eliminating or nullifying the tax incentives for homeownership puts home values and middle-class homeowners at risk, and from a cursory examination this legislation appears to do just that,” said William E. Brown, president of the National Association of Realtors. “We will have additional details upon a more thorough reading of the bill.”

Jerry Howard, chief executive of the National Association of Homebuilders, said he was very disappointed in the Republican tax plan and warned that it could create a recession in the housing market.

“It puts such severe limitations on home buyers ability to use the mortgage interest deduction that home values will fall,” Mr. Howard said in an interview. “If a home seller takes a loss, that’s money they were counting on for retirement.”

Mr. Howard said the bill amounts to a broken promise.

“Contrary to their assertions, the Republicans are picking winners and losers,” he said. “They are picking rich Americans and corporations over small businesses and the middle class.”

Eliminating the medical expense deduction

A big change may be in store for those who deduct medical expenses. The talking points outlined by Republicans say the deduction will go away but that families will be made whole by the overall lowering of tax rates and doubling the standard deduction. But those who make heavy use of the medical expense deduction — including many middle-class families — may be opposed to that change.

Repealing the estate tax — eventually

The proposal will double the estate tax exemption to roughly $11 million, from $5.49 million, meaning families can avoid paying taxes on large inheritance. And it eventually repeals the estate tax altogether, phasing it out entirely in six years.

Adding limits to the state and local tax deduction

One of the biggest flash points will be how the bill treats the state and local tax deduction, which lawmakers are proposing to limit to property taxes and cap at $10,000. That will not be enough for Republicans in some high-tax states, where middle-class families make heavy use of the deduction, which currently applies to state and local income taxes and general sales taxes as well as property taxes.

House Republicans had intended to roll out the tax proposal on Wednesday, but ended up delaying its release by a day, providing a signal of the steep challenge they face in making the math work while also assembling the votes they need to get a bill through the chamber.

Representative Dan Donovan, a Republican from New York, said he remained concerned about the impact of the state and local tax deduction as he left a briefing on the bill but said he would assess the proposed changes on their entirety.

“I’m looking for a benefit for the people I represent,” he said. “The people of New York City deserve a tax break.”

Multinational corporations face big changes

For the first time, the United States is proposing to have a global minimum tax of 10 percent, which would apply to income that American companies earn anywhere in the world. The effort is aimed at preventing companies from shifting profits abroad and grabbing back some of the tax revenue on income earned overseas. Those profits are currently not taxed until they are returned to the United States, giving companies an incentive to keep that money offshore since they are taxed at the current corporate tax rate of 35 percent.

Republican leaders are encouraged

Walking into the men’s restroom, Representative Kevin McCarthy, Republican of California, said of his colleagues, “It looks very positive, these people are excited.” He added: “this is why they came to Congress.”

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New York attack suspect should get death penalty, Trump says – CNN

Sayfullo Habibullaevic Saipov, a 29-year-old Uzbekistan native who was living in New Jersey, is charged with providing material support to ISIS, dviolence and destruction of motor vehicles, said Joon H. Kim, the acting US Attorney for the Southern District of New York .
Saipov appeared in federal court in a wheelchair and didn’t enter a plea, a source at the US Attorney’s Office told CNN.
President Donald Trump said he should be executed.
“NYC terrorist was happy as he asked to hang ISIS flag in his hospital room. He killed 8 people, badly injured 12. SHOULD GET DEATH PENALTY!’ the President tweeted late Wednesday night.
Saipov told investigators he was inspired by Islamic State videos, in particular one showing ISIS leader Abu Bakr al-Baghdadi, a federal criminal complaint states.
How the New York City truck attack unfoldedHow the New York City truck attack unfolded
The suspect decided to conduct a truck attack “to inflict maximum damage against civilians” and that he specifically chose to strike on Halloween “because he believed there would be more civilians on the street for the holiday,” the complaint says.
He began planning an attack a year ago and decided two months ago to use a truck, officials said.
One of Saipov’s cellphones reviewed by law enforcement contained approximately 90 videos, “many of which appear to be … ISIS-related propaganda.” The phone also had almost 4,000 images, many of which were ISIS propaganda, the FBI said in the complaint.

Here are the latest developments:

  • Five Argentinian high school classmates, two young American men and a Belgian mother were identified as the victims, police said.
  • President Donald Trump called Mayor Bill de Blasio and Gov. Andrew Cuomo to offer any federal assistance needed, Trump tweeted.
  • The suspect arrived in the US as part of the diversity immigrant visa program, the Department of Homeland Security said.
  • An Uzbek national is being questioned in connection with the attack, law enforcement sources say. The individual, previously identified as Mukhammadzoir Kadirov, may have pertinent information and is possibly an associate of suspect Sayfullo Saipov, one source says.

The attack

Authorities said Saipov came to the US legally in 2010. He allegedly drove a rented truck onto a well-trafficked bike path just blocks from the World Trade Center on Tuesday afternoon.
Eight people were killed and more than a dozen injured as the truck carved a path of destruction through several blocks of Lower Manhattan. Saipov crashed the truck into a school bus, left the vehicle brandishing imitation firearms and was shot by police, officials said.
In carrying out the attack, Saipov relied on the playbook laid out by ISIS in recent years, officials said.
“He appears to have followed almost exactly to a ‘T’ the instructions that ISIS has put out in its social media channels before, with instructions to their followers on how to carry out such an attack,” John Miller, NYPD deputy commissioner for intelligence and counterterrorism, said at an earlier news conference.
A handwritten “document” found near the scene had both Arabic and English text, and included the message that the Islamic State would endure, the complaint says.

The suspect

Saipov came to the US from the central Asian nation of Uzbekistan in 2010 on a diversity immigrant visa, according to the Department of Homeland Security. The Diversity Immigrant Visa Program awards up to 50,000 individuals per year a visa for a green card, which bestows permanent residency and is a path to citizenship.
The visas are awarded randomly to those in select countries to promote immigration from places that don’t otherwise send many immigrants to the US. The bill establishing the program was signed into law in 1990.
NYPD’s Miller said Saipov has never been the subject of an NYPD or FBI investigation, but investigators are looking into how he is connected to the subjects of other investigations.
Saipov was “radicalized domestically” in the US, Gov. Andrew Cuomo said.
“The evidence shows — and again, it’s only several hours, and the investigation is ongoing — but that after he came to the United States is when he started to become informed about ISIS and radical Islamic tactics,” Cuomo said.
Saipov was not on any US government terror watch lists, according to two sources familiar with the investigation.
Just over six months ago, Saipov began driving for Uber in New Jersey, the company told CNN. He passed a background check. The company said it has not yet identified any complaints about his safety.
The company is cooperating with authorities in the investigation.
Who is New York attack suspect Sayfullo Saipov?Who is New York attack suspect Sayfullo Saipov?
Saipov once listed his occupation as a truck driver, his marriage license shows.
He had multiple run-ins with law enforcement in several states, online records show. He had traffic citations issued in Maryland, Missouri and Pennsylvania and was arrested by the Missouri State Highway Patrol in October 2016 after failing to show up in court for a misdemeanor offense.
He paid a $200 bond, which he forfeited when he didn’t show up in court for his next hearing in November. A guilty plea was entered on his behalf.
Saipov’s wife has spoken with investigators, law enforcement officials said. Saipov, his wife and three children have a residence in Paterson, New Jersey.
Carlos Batista, one of Saipov’s neighbors in Paterson, told CNN that Saipov had acted as a “peacemaker” about six months ago. Batista was riding a dirt bike at night, and Saipov’s friends asked him to stop. The incident became testy until Saipov stepped in and “calmed everything down,” Batista said.
Saipov has been linked to social media accounts that contain ISIS-related material, a law enforcement official said Wednesday morning. The official also said Saipov has been somewhat cooperative with FBI and New York police investigators who questioned him in the hospital overnight.

The victims

Among the eight people killed, five were from Argentina, two were Americans, and one was from Belgium, according to the New York Police Department.
The Argentinians were part of a group celebrating their high school reunion in New York City, Argentina’s Foreign Affairs Ministry said.
Victims of the New York terror attackVictims of the New York terror attack
Hernán Diego Mendoza, Diego Enrique Angelini, Alejandro Damián Pagnucco, Ariel Erlij and Hernán Ferruchi died in the attack, the ministry said in a statement Tuesday.
They had traveled to New York from Rosario, a town nearly 200 miles northwest of Buenos Aires, to mark the 30th anniversary of their high school graduation. A sixth Argentine national who was also part of the group was injured during the attack.
Nicholas Cleves, 23, from New York, and Darren Drake, 32, from New Milford, New Jersey, were the two Americans killed.
Anne-Laure Decadt, a 31-year-old Belgian woman, was also among those killed, according to a statement from her husband, Alexander Naessens. Decadt, a mother of two young sons, was on a trip to New York with her two sisters and her mother, Naessens said.

The President’s response

Hours after the attack, President Trump tweeted that he’s ordered the Department of Homeland Security “to step up our already Extreme Vetting Program“, and he accused Sen. Chuck Schumer of not being tough enough on immigration.
Who is the NYPD officer who apprehended the suspect?Who is the NYPD officer who apprehended the suspect?
Speaking to the media on Wednesday, Trump called the suspect an “animal” and said that he planned to start the process of terminating the diversity lottery program.
“I am going to ask Congress to immediately initiate work to get rid of this program. Diversity lottery, diversity lottery. Sounds nice, it is not nice, it is not good. It hasn’t been good and we have been against it,” he said.
Earlier, Gov. Cuomo criticized Trump’s tweets.
“The President’s tweets were not helpful. I don’t think they were factual. I think they tend to point fingers and politicize the situation,” he said.
“You play into the hands of the terrorist to the extent that you disrupt, divide and frighten people in the society. The tone now should be the opposite — on all levels.”
New York City Mayor Bill de Blasio said “the last thing we should do is start casting aspersions on whole races of people or whole religions or whole nations. That only makes the situation worse.”
De Blasio also warned against stereotyping all Muslims as extremists.
“Anyone who wants to come into this country should be very thoroughly vetted as an individual,” he said. “But the minute you start generalizing it, especially to a whole religion, then unfortunately we’re sending the exact negative message that a lot of our enemies want and the terrorist wants to affirm — that this nation is somehow anti-Muslim. We’ve got to do the exact opposite.”

Vehicles as weapons

The tactic of turning an ordinary vehicle into a lethal weapon is becoming increasingly common.
In 2014, an ISIS spokesman called for lone-wolf attacks using improvised weaponry. “If you are not able to find an IED or a bullet, then single out the disbelieving American, Frenchman or any of their allies. Smash his head with a rock or slaughter him with a knife or run him over with your car or throw him down from a high place or choke him or poison him.”
Vehicles as weapons: New York City crash is part of a deadly trendVehicles as weapons: New York City crash is part of a deadly trend
Since 2014, there have been 15 vehicular attacks in the West by jihadist terrorists, killing 142 people, according to a count by New America, a nonpartisan research institution. Those figures include Tuesday’s attack in Manhattan.
CORRECTION: This story has been updated to reflect the note claiming that the attack was made in the name of ISIS was found near the truck. It has also been updated to correctly quote Mayor Bill de Blasio on comments he made cautioning against casting blame on different groups of people.

CNN’s Shimon Prokupecz, Tal Kopan, Paul Murphy, Brynn Gingras, David Shortell, Topher Gauk-Roger, Curt Devine, Hilary McGann, Elizabeth Joseph, Athena Jones, Sarah Jorgensen, Nelli Black, Kristina Sgueglia and Patricia DiCarlo contributed to this report.

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Driver Charged in Deadly Attack in Lower Manhattan. – New York Times

Federal prosecutors on Wednesday filed charges accusing the driver in the Manhattan truck attack of carrying out a long-planned plot, spurred by Islamic State propaganda videos, to kill people celebrating Halloween.

The charges, filed just over 24 hours after the deadliest terror attack on New York City since Sept. 11, 2001, placed the case in the civilian courts even as President Trump denounced the American criminal justice system as “a joke” and “a laughingstock.”

The charges describe the driver, Sayfullo Saipov, 29, as a voracious consumer and meticulous student of ISIS propaganda, and detail how he said he was spurred to attack by an ISIS video questioning the killing of Muslims in Iraq. They say he began planning the attack about a year ago and, after taking a test run in a Home Depot rental truck last week, chose Halloween to carry it out because more people would be on the streets.

The charges were filed in civilian court, and not the military system set up for foreign terrorists, a decision that flew in the face of Mr. Trump’s broadsides against the criminal justice system. Mr. Trump said he was open to trying Mr. Saipov instead in military court at the American prison at Guantánamo Bay, Cuba.

Mr. Saipov, accused of killing eight people and injuring 12 in the attack, was pushed into a Manhattan federal courtroom in a wheelchair just after 6 p.m. on Wednesday. He sat slightly hunched, his rail-thin body dressed in a gray shirt and gray pants. His hair stuck up slightly in the back. His hands and feet were chained. Five guards stood behind him.

A Russian interpreter spoke into a microphone, and Mr. Saipov, an immigrant from Uzbekistan, fitted an earpiece over his long beard and sharp features. When Magistrate Judge Barbara C. Moses asked if he understood the proceedings, Mr. Saipov, in a strong, clear audible voice, responded in English, “Yes, ma’am.”

He nodded along as Judge Moses read his rights, but sat still and impassive when she read the charges against him: one count of providing material support to terrorists and one count of violence and destruction of a motor vehicle causing death.

The vehicle charge, which carries the possibility of the death penalty, raised the prospect of a rare capital case being brought to trial in New York.

David E. Patton, the chief federal public defender for the Southern District of New York, who was representing Mr. Saipov, asked that he receive a daily change of dressing on the wounds he sustained after being shot by a police officer.

“He is in a significant amount of pain,” Mr. Patton said.

The grievous injuries to victims, the scope of the inquiry and Mr. Saipov’s path toward extremism all began coming into view on Wednesday. The F.B.I., after saying it was trying to learn more about a second Uzbek man in connection with the attack, later announced that investigators had found the man, Mukhammadzoir Kadirov, 32 in New Jersey. It was not clear why federal authorities wanted to question him in connection with the attack.

The authorities questioned Mr. Saipov after he waived his Miranda rights at a Manhattan hospital, the complaint says. They were also questioning Mr. Saipov’s wife, Nozima Odilova, who was cooperating, law enforcement officials said. The couple live in Paterson, N.J., and have three children.

As investigators looked into whether Mr. Saipov’s Uzbek contacts may have handed him off to an ISIS operative, they pieced together parts of his past, law enforcement officials said. He attended a wedding Florida of an Uzbek man who was under scrutiny by the F.B.I. But his attendance didn’t trigger a separate investigation of him, the officials said.

Investigators were still looking into whether Mr. Saipov had links to other federal counterterrorism inquiries.

On Mr. Saipov’s cellphone, F.B.I. agents found 90 videos, including of ISIS fighters killing prisoners and of instructions for making an explosive device, according to the criminal complaint. They also found 3,800 images, among them some of Abu Bakr al-Baghdadi, the leader of ISIS. The complaint said Mr. Saipov reported being inspired in particular by a video in which Mr. al-Baghdadi “questioned what Muslims in the United States and elsewhere were doing to respond to the killing of Muslims in Iraq.”

The F.B.I. was uncovering details that sent agents on a far-ranging chase for leads.

But several crucial facts remain unclear. It is not known if the F.B.I. is still investigating the Uzbek man whose wedding Mr. Saipov attended. And as investigators built out concentric circles of his associates, they are still looking at whether Mr. Saipov had direct connections with ISIS operatives.

Even so, the federal complaint filed against Mr. Saipov said he hewed closely to instructions last November in an ISIS magazine, Rumiyah, for a vehicle attack. After plowing his Home Depot rental truck down a bike path along the Hudson River that teemed with pedestrians and cyclists and crashing into a school bus, the complaint said, he jumped out of the truck, yelled “Allahu akbar” (Arabic for “God is great”) and waved a paintball gun and a pellet gun.

The Rumiyah instructions called for followers to carry secondary weapons so they could continue an attack after crashing the vehicle, and Mr. Saipov did so, the complaint said: He had a bag of knives in the truck “but was unable to reach them before exiting.” There was also a stun gun on the floor of the truck near the driver’s seat, according to the complaint.

Investigators found a handwritten note in Arabic and English 10 feet from the driver’s side door, as the front of the truck sat smashed in, with soil strewn across the street that had been knocked out of a nearby planter. According to the complaint, the note detailed a pledge that echoed language used by ISIS: “Islamic Supplication. It will endure.”

“He appears to have followed almost to a T the instructions that ISIS has put out,” John J. Miller, the New York Police Department’s deputy commissioner for intelligence and counterterrorism, said at a news conference on Wednesday morning.

Those who knew Mr. Saipov said he had been turning toward extremism for years since arriving in the United States in 2010.

Mirrakhmat Muminov, a truck driver and community activist in Stow, Ohio, said Mr. Saipov became aggressive and grew out his beard during his three years there. Mr. Muminov said Mr. Saipov showed up late for Friday prayers and exhibited rudimentary knowledge of the Quran. He would get heated when he discussed American policies regarding Israel, Mr. Muminov said.

His problems deepened when he moved to Florida. Abdul, a preacher at a Tampa mosque who agreed to speak on the condition that only his first name be used because he feared reprisals from other radicals, said he tried to steer Mr. Saipov away from the path of extremism.

In the months before Tuesday’s attack, the complaint said, Mr. Saipov began plotting assiduously. Nine days beforehand, he rented a Home Depot pickup truck so he could practice making turns, according the complaint.

He also rehearsed the route from New Jersey, over the George Washington Bridge and down the West Side of Manhattan in an Uber car he drove in the days before the incident, a law enforcement official said.

On Tuesday, he asked to rent the Home Depot truck for a short while, though he never intended to return it, the complaint said. He planned to drive all the way south to the Brooklyn Bridge, but he made it only as far as Chambers Street.

By the time his rampage ended, six people had been killed and two others would later die. Nine people remained hospitalized from injuries on Wednesday, officials said, four of them critically injured but in stable condition. The injuries ranged from the amputation of multiple limbs to serious head, neck and back trauma.

The complaint said Mr. Saipov decided against displaying ISIS flags on the truck to avoid drawing attention to himself. But laying in his hospital bed, he continued his quest, the complaint says: He asked law enforcement officials to put up ISIS flags and “stated that he felt good about what he had done.”

Rukmini Callimachi, Sarah Maslin Nir, Eric Schmitt, Michael Schwirtz, Ashley Southall, Vivian Wang, Ben Weiser contributed reporting. Susan C. Beachy and Doris Burke contributed research.

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Powell, Once an Also-Ran, Set to Chair Trump’s Bank-Friendly Fed – Bloomberg

A few months ago, Jerome Powell was reckoned to be too tough on banks to get President Donald Trump’s nod for a key supervisory post at the Federal Reserve.

Now he’s said to be in line for the top job as Fed chairman, with the expectation that he’ll make life easier for the financial industry. Three people familiar with the decision said Trump had told Powell he’s the nominee, though that hasn’t been confirmed by the White House, the Fed or the candidate himself. A public statement is due Thursday. Trump’s pick was reported earlier by the Wall Street Journal.

University of California’s Brad DeLong discusses Jerome Powell would bring to the role of Federal Reserve chairman.

(Source: Bloomberg)

That’s a temperate version of Trump’s charge that red tape is choking the flow of credit to business. The president, a former real-estate developer, has also made it clear that he’s fine with the cheap money that’s characterized the Yellen era. Those preferences add up to a Fed chair who would stick with the program on monetary policy and loosen some restrictions on banks — an equation that’s led Trump to Powell.

Except for the fact that he’s rich, Powell is unlike Trump in almost every way. He’s a low-profile pragmatist, a team player who avoids making waves. In tapping him, Trump ignored pressure from his own party to put a disrupter like himself in charge at the Fed. Powell was chosen over rivals including Kevin Warsh and John Taylor — a favorite of Vice President Mike Pence — who were associated with calls for much higher interest rates and a fundamental shake-up at the world’s most powerful central bank.

By picking Powell, a known quantity, the president may be hoping that the economy and stock market can maintain the winning streaks they’ve enjoyed under Yellen. Her term expires on Feb. 3.

Crisis Leadership

What’s not known is how the 64-year-old Powell will react should disaster strike, in the form of a crisis or recession. While he had a taste of the former, as a mid-level Treasury official more than a quarter-century ago, Powell has never held a leadership position during a financial emergency. A lawyer by training, he’s also not spent his career monitoring the ups and downs of the economy — as Yellen has done.

“He does not have the extent of background and experience as Yellen, which does raise concerns about how he will respond when conditions in the economy change,” said Dean Baker, Co-Director of the progressive Center for Economic and Policy Research.

Tricky Time

The Washington native would be taking over the Fed at a tricky time. Inflation is well below the central bank’s 2 percent target, while asset prices are at levels considered lofty by policy makers. Trump’s push for a massive tax cut to supercharge growth, in an economy that already has historically low unemployment, won’t make the task easier.

Powell hasn’t played a prominent public role in the formulation or explanation of policy, but has been supportive of Yellen’s strategy of gradually increasing interest rates — an approach he’s likely to maintain as Fed chair. He did voice private skepticism about the third round of quantitative easing launched by then-Chairman Ben S. Bernanke in 2012, but ended up voting in favor, according to Bernanke’s memoir.

Powell won’t be deploying a battery of economic theory to these questions. He’d be the first holder of the job since Paul Volcker in the 1980s not to have a Ph.D. in economics.

Monetary ‘Science’

Some see his lack of an economics degree as a hole in his resume.

“The chair should be an economist by training,” said former Philadelphia Fed President Charles Plosser, himself a Ph.D. economist. “The nuance of monetary policy and the science of monetary policy have become much more complex and subtle and difficult.”

Powell faced similar skepticism from staffers when he joined the Fed in 2012. He won them over by displaying a willingness to dig deep into complexities, an ex-Fed official said. He was known for showing up at meetings carrying a huge binder full of materials.

While Powell has never dissented from a monetary-policy decision, a former colleague disputed suggestions that he was a yes-man. “There has been a recent tradition of governors not dissenting,” said ex-Dallas Fed President Richard Fisher. “That doesn’t mean he didn’t add an important dimension to the discussion.”

A former Treasury undersecretary, Powell spearheaded the Fed’s response to the 2014 “flash crash” in U.S. government debt, and the overhaul of the flawed London Interbank Offered Rate benchmark. Until recently, he presided over four of the Fed Board’s seven committees, handling such unglamorous duties as overseeing the financial payments system.

“He has taken on tasks that the other governors didn’t want,” said Fisher. “He now really understands what makes the place tick.”

‘Business Head’

Powell also oversaw the Fed’s 12 regional banks, an experience that would serve him well as he works with their presidents to fashion a consensus on monetary policy.

“He brought a very good business head to all the nitty-gritty questions we had to deliberate over,” former Atlanta Fed President Dennis Lockhart said.

Powell, who goes by ‘Jay’, spent much of his career outside government in finance — first at investment bank Dillon Read & Co. and then at private-equity firm Carlyle Group, where he set up an industrial unit and was seen as a prudent and picky investor.

“Jay was somebody who had experience in both business and in government and also had a legal background,” said Carlyle co-founder David Rubenstein. “That’s a rare combination.”

It helped make him a multi-millionaire — like many Trump nominees. Powell’s 2016 financial disclosure form listed assets of as much as $55 million.

‘Fantastic Job’

Powell’s experience in official Washington dates back to President George H. W. Bush’s Treasury Department — where he served alongside Randal Quarles, who beat Powell to get the nod for the Fed supervisory post in July. It was in those years that he saw a financial emergency firsthand.

Salomon Brothers had tried to corner a Treasury debt auction using phony bids in 1991, and faced a potential bank run that summer. On vacation in Cape Cod, Powell spent a weekend conferring by phone with officials including Fed Chairman Alan Greenspan and Treasury Secretary Nicholas Brady. He then acted as a go-between with Salomon investor Warren Buffett.

Powell “did a fantastic job,” Brady said. “I relied on him heavily.” Salomon survived the Monday market opening.

Harvard University professor Robert Glauber, who worked with Powell at the Treasury, said he valued the investment banking know-how that his former colleague brought to the job. “He’s not a person with sharp elbows,” added Glauber. “People respected and trusted him.”

True Believer?

Powell, who has an undergraduate degree in politics from Princeton University and a law degree from Georgetown, saw another crisis up close in 2011, when a budget deadlock raised the specter that the U.S. may not meet its debt obligations. From outside government — he was working, essentially gratis, at a Washington think-tank — Powell played a key behind-the-scenes role in helping to avert a default.

His work caught the attention of President Barack Obama, who tapped Powell for the Fed board. The Obama link has raised suspicions among some Republicans, who question whether Powell is a true believer in the deregulatory agenda — a skepticism fueled by the Fed governor’s preference for keeping many of his misgivings in-house. That said, Powell would be all-but-certain to win Senate confirmation, as Republicans are unlikely to oppose the pick of their own party’s president.

Married with three children, Powell has a reputation as a bit of an athlete. At Carlyle, he was known to spend lunch hours cycling, and he still regularly bikes the eight miles to work at the Fed from his home in Chevy Chase, Maryland.

“He complains about a bad back, then beats the hell out of me on the golf course,” Lockhart said.

Powell also has an unusual ability to repeat people’s sentences back to them — backwards. It shows how well he listens, according to those who know him.

He displays signs of a sense of humor, too. In Powell’s current office at the Fed, pride of place goes to a hat given him by a Wisconsin senator — a giant triangle of cheese-shaped yellow foam, the kind that fans of the Green Bay Packers football team wear to their games.

It’s not clear whether he’ll take it down the corridor if the Senate confirms him to the biggest job in the financial world.

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