| Happy Tuesday and welcome back to On The Money, where we'd gladly let someone buy us $12 billion worth of food. I'm Sylvan Lane, and here's your nightly guide to everything affecting your bills, bank account and bottom line. See something I missed? Let me know at slane@thehill.com or tweet me @SylvanLane. And if you like your newsletter, you can subscribe to it here: http://bit.ly/1NxxW2N. Write us with tips, suggestions and news: slane@thehill.com, vneedham@thehill.com, njagoda@thehill.com and nelis@thehill.com. Follow us on Twitter: @SylvanLane, @VickofTheHill, @NJagoda and @NivElis. THE BIG DEAL--Trump offers $12B in aid to farmers hit by tariffs: The Department of Agriculture (USDA) on Tuesday announced it would offer $12 billion in aid to farmers hindered by retaliatory tariffs imposed on U.S. grain, produce and meat exports as the Trump administration digs in for a protracted trade battle. The department will use the emergency aid to assist and buy crops from farmers who've lost billions of dollars in sales from foreign buyers in the European Union, Canada, Mexico and China. Trump has stood behind his decision to impose tariffs on a broad array of goods despite mounting criticism, but has promised to aid farmers harmed by the retaliatory measures. The White House had hinted for months at an impending relief package for farmers losing business to cheaper foreign competitors unrestrained by tariffs. "America's hard-working agricultural producers have been treated unfairly by China's illegal trading practices and have taken a disproportionate hit when it comes illegal retaliatory tariffs," Agriculture Secretary Sonny Perdue said in a statement. Reaction: Republicans and Democrats both panned the aid package as details of the plan first emerged. They called on Trump to abandon the tariffs that necessitated the relief to farmers in the first place. I'll tell you more right here about the aid package and the reception it got in Congress. What's going on? - American farmers have been targeted by key U.S. trading partners in response to President Trump's imposition of levies on imported aluminum, steel and Chinese goods.
- The EU, Canada, Mexico and China have responded with tariffs on key U.S agricultural exports like corn, soybeans, beef, poultry and apples, sinking global demand for American farm goods.
- Billions of pounds of American crops and meat have reportedly sat idle in storage facilities while their producers lose money from canceled sales.
How the aid will work - USDA will provide direct payments to producers of soybeans, sorghum, corn, wheat, cotton, dairy and hogs to help them cover their losses and find new markets for their goods.
- The department will also purchase surpluses of fruits, nuts, rice, legumes, beef, pork and milk "for distribution to food banks and other nutrition programs," USDA announced.
Reactions - "They put in place a policy that requires our farmers to go on welfare and, you know, it's a ridiculous policy that just needs to be reversed." -- Sen. Bob Corker (R-Tenn.).
- "What happens when other countries gain our markets? Can you do $12 billion regularly? How long does this take?" -- Sen. Jerry Moran (R-Ks.).
- "Without prompt action, we could lose farmers and the rural businesses they support and depend on at a rapid rate." -- Sen. Tammy Baldwin (D-Wis.).
- "We don't want money from the Treasury. We want markets." -- Sen. Chuck Grassley (R-Iowa).
- "If tariffs punish farmers, the answer is not welfare for farmers -- the answer is remove the tariffs." -- Sen. Rand Paul (R-Ky.).
- "This administration's tariffs and bailouts aren't going to make America great again, they're just going to make it 1929 again." -- Sen. Ben Sasse (R-Neb.).
- "The farmers will be the biggest beneficiary. Watch. We're opening up markets. You watch what's going to happen. Just be a little patient." -- President Trump
What comes next: Lawmakers in both parties, businesses groups and farmers have become increasingly frustrated with Trump as blowback from the tariffs hits the U.S. economy. Federal Reserve officials have noted a decrease in planned business investment and expansion, and a slew of U.S. manufacturers have warned that their business could soon fail because of rising costs of raw materials and supplies. The National Retail Federation (NRF) and 65 organizations representing U.S. retailers, manufacturers, farmers and technology companies joined together to tell U.S. Trade Representative Robert Lighthizer that tariffs won't work to open China's market to more U.S. imports. But Trump, speaking at the Veterans of Foreign Wars National Convention in Kansas City, Mo., told Tuesday that the steep tariffs his administration has imposed will pay off in the end. Trump lamented that trade deals the U.S. had with other countries have long been "one-sided," and cost the U.S. billions of dollars. "We've got to fight it. Nobody else fought it," Trump said. "Not any longer, folks. We're making tremendous progress," he continued. "They don't want to have those tariffs put on them. They're all coming to see us."
ON TAP TOMORROW
LEADING THE DAY Brady outlines plan for phase two of tax cuts: House Ways and Means Committee Chairman Kevin Brady (R-Texas) on Tuesday outlined a "tax cuts 2.0" package, which House Republicans hope to vote on in the weeks before the midterm elections. House Republicans have been working with the White House on a second package of tax cuts. They see the package as smart politics ahead of the midterms, to help remind voters about the law they passed last year and to expand upon it. But the central feature of the package -- permanently extending the 2017 tax law's cuts for individuals -- is unlikely to pass the Senate, and may not even get a vote there. Brady released a two-page framework for the tax package and met with a group of House GOP lawmakers on Tuesday afternoon to discuss it. The Hill's Naomi Jagoda tells us more about it here.
New bipartisan Russia sanctions in the works: Sens. Lindsey Graham (R-S.C.) and Bob Menendez (D-N.J.) are working on legislation to slap new sanctions on Russia as Congress faces pressure to crack down in the wake of the Helsinki summit.
"The United States must make it abundantly clear that we will defend our nation and not waver in our rejection of his effort to erode western democracy as a strategic imperative for Russia's future," Menendez and Graham said in a joint statement on Tuesday. In addition to making sure the 2017 sanctions legislation, which passed Congress overwhelmingly, is fully implemented, the forthcoming Graham-Menendez bill includes new sanctions on Russia's debt and energy and financial sectors. It would also target cyber actors in Russia and Russian oligarchs. The Hill's Jordain Carney breaks it down here. The legislation comes as senators are weighing how to respond to Moscow after President Trump refused to denounce Russian meddling in the 2016 president election during last week's summit with Putin in Helsinki. A bipartisan pair of senators on Tuesday asked the Treasury Department to impose financial sanctions on the 12 Russian intelligence officers indicted by special counsel Robert Mueller last week for allegedly hacking the emails of top Democratic Party officials. In a Tuesday letter, Sens. Pat Toomey (R-Pa.) and Chris Van Hollen (D-Md.) asked Treasury Secretary Steven Mnuchin to target the alleged cyber-criminals under sanctions enacted by President Trump through executive orders and legislation he signed. Both lawmakers are members of the Senate Banking Committee, which has jurisdiction over financial sanctions. The panel's chairman, Sen. Mike Crapo (R-Idaho), said Tuesday that he'd hold hearings on stricter Russian sanctions amid growing concerns about Trump's relationship with Russia. Senate Foreign Relations Committee Chairman Bob Corker (R-Tenn.) also pledged Tuesday to hold hearings on new Russian sanctions. MARKET CHECK: AP: "The major U.S. stock indexes ended mostly higher Tuesday after several big U.S. companies turned in strong quarterly results. "Gains by technology companies and health care stocks outweighed losses in consumer goods manufacturers, retailers and other sectors. Small-company stocks, which have been beating the rest of the market this year, turned lower. "The S&P 500 index rose 13.42 points, or 0.5 percent, to 2,820.40. The Dow Jones Industrial Average gained 197.65 points, or 0.8 percent, to 25,241.94. The Nasdaq composite lost 1.11 points, or 0.01 percent, to 7,840.77." FINANCE IN FOCUS: Trump's criticism of the Federal Reserve is posing a challenge for Chairman Jerome Powell as he attempts to navigate the economy through potentially turbulent waters ahead. Trump has publicly bashed Powell for raising interest rates as unemployment lingers near record lows and U.S. economic growth picks up at a higher rate. The president worries the Fed's gradual rate hikes will hinder the economy as he pushes for new trade terms with economic partners. Powell, whom Trump chose to take over the central bank, already faces a delicate balancing act as the Fed tries to maintain strong economic growth without sparking rampant price increases or financial market bubbles. I'll tell you here whether Trump's attacks could impact the Fed and shape the public perception of the central bank. GOOD TO KNOW - Montana Gov. Steve Bullock (D) sued the IRS on Tuesday to block a new policy no longer requiring some non-profits to reveal their donors.
- The House on Tuesday voted to repeal ObamaCare's medical device tax, a provision that members of both parties have criticized as harming innovation.
- Harley-Davidson Inc. has slashed its profit margin forecast for this year due to the expected damage from tariffs prompted by President Trump.
- Lawmakers are demanding the first study in nearly a decade on pay for congressional staffers amid growing concerns about whether those workers, in particular women and racial minorities, are being underpaid.
- GOP Lawmakers will be closely watching the outcome of Wednesday's meeting between Trump and European Commission President Jean-Claude Juncker, who is traveling to the nation's capital to head off a full-blown transatlantic trade war.
ODDS AND ENDS - The organizers of the infamous failed Fyre music festival will pay the Securities and Exchange Commission (SEC) more than $27 million to settle fraud charges, the agency announced Tuesday.
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