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MNI BRIEF: EU To Announce EDPs Next Week - Officials

The EU is set to announce Excessive Deficit Procedures against seven member states.

Political Risk

Biden To Deliver Remarks At Unidos Conference Shortly

US President Joe Biden is shortly due to deliver remarks at the UnidosUS annual conference in Las Vegas, Nevada. Livestream

  • The speech comes amid what appears to be a Biden pivot to the left in response to an embrace from the progressive flank of the Democratic Party that has kept the rebellion against his presidential candidacy at bay.
  • Axios reports: “Biden said this past week that if he's re-elected, he'd call for legislation to cap landlords' ability to hike rent prices, push for a large-scale elimination of medical debt, and pursue other plans that have been applauded by progressives such as Sen. Bernie Sanders (I-VT).”
  • Rep Brad Sherman (D-CA) told Axios the president is teasing many policies the Congressional Progressive Caucus wants — which he said is "not a complete coincidence," based on where Biden is now drawing support.
  • Bloomberg reports that Biden, “is planning to unveil proposals that could dramatically reshape the Supreme Court, including term limits on justices who now sit on the court for life.” Another move that is likely to be welcomed by progressives.

More Warning Signs For Biden In Virginia

A new poll from Virginia University’s Wilder School has exposed more major warning signs for Biden in Virginia, a state he won comfortably in 2020 and wasn’t considered likely to be competitive in November.

  • Wilder notes: “When asked who they would vote for if the election for president was being held today,” Donald Trump 39% leads Joe Biden 36%.
  • The report notes: “…this poll but sees a shift towards President Trump compared to VCU Wilder School’s December poll which had President Biden leading President Trump 42% - 39%.”
  • Former Democrat Governor of Virginia Douglas Wilder, the operator of the poll, said: “I think the results show that Virginia is truly a “battleground state” for the presidency. The drop by 20% (46%) of Black Virginians since December, where 67% supported Biden, should be concerning relative to turnout affecting congressional races, in particular in competitive districts 7 and 2.”
  • The survey also throws up an extraordinary 13-point polling gap between Biden and Senator Tim Kaine (D-VA) who is running for re-election.
  • Semafor notes: “We’re seeing a ton of separation between Biden and down-ballot Democrats, more like the gap between his approval rating and Democratic performance in 2022 than anything in a modern presidential election.”

Figure 1: Virginia Polling, Presidential and Senate Election

Source: Virginia University’s Wilder School

Democrat Rep Schiff Calls On Biden To Withdraw From Presidential Race

Democratic House Representative, Adam Schiff (D-CA), has become the most senior Democrat to publicly urge President Biden to withdraw from the 2024 presidential race.

  • Schiff said in a statement to the LA Times: “President Biden has been one of the most consequential presidents in our nation’s history...
  • "But our nation is at a crossroads. A second Trump presidency will undermine the very foundation of our democracy, and I have serious concerns about whether the President can defeat Donald Trump in November.
  • “While the choice to withdraw from the campaign is President Biden’s alone, I believe it is time for him to pass the torch."
  • The statement comes after the New York Timesreported that Schiff told doners over the weekend that Democrats were likely to suffer overwhelming losses in November if President Biden remained at the top of the ticket.
  • Schiff is anear-certaintyto win the influential California Senate seat vacated by the late Dianne Feinstein, at the general election in November. It is also probable that Schiff consulted with fellow Democrat Rep, Nancy Pelosi (D-CA), before issuing his statement. Pelosi is regularly reportedas a key figure in 'Biden out' movement who may have sufficient political capital to lean on Biden to withdraw.
  • According to data from Polymarket, Biden is given a 39% implied probability of dropping out of the race. This is likely to rise if Schiff's statement prompts additional Democrats to come forward with similar calls for Biden to step aside.

Fin Min Hopes EU Will Give Leeway In EDP Assesment To Boost Def Spending

Reuters reporting that Italian Finance Minister Giancarlo Giorgetti has said that he hopes the European Commission will provide some leeway with regards to the excessive deficit procedure (EDP) set to be launched against Italy (and eight other EU members) on 26 July as the gov't seeks to boost defence spending. Giorgetti said that "We hope the European Commission will recognise defence spending as a relevant factor...It is a necessary condition for the Italian government to meet its political commitment to adjust military spending,"

  • As Reuters reports, "In Italy, defence spending has fallen from 1.59% of GDP in 2020 to 1.46% in 2023. Prime Minister Giorgia Meloni said at a NATO summit this month she intends to reverse the trend by raising it to 1.6% next year."
  • The role of the lead party in the Italian gov't - PM Giorgia Meloni's conservative Brothers of Italy (FdI) - could prove crucial over the coming 24 hours. Commission President Ursula von der Leyen is seeking re-election, and while the numbers of MEPs likely to vote for her should push her over the required majority, the nature of the secret vote means this is not guaranteed. VdL could be reliand on the FdI's 24 MEPs to back her candidacy.
  • Amid this, the Italian gov't confirmed Minister for European Affairs Raffaele Fitto would be Rome's nominee for Italy's Commission portfolio. Italy will be seeking a senior Commission role for Fitto, with the previous Italian Commissioner Paolo Gentiloni holding the Economy portfolio.

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